Starting a business much harder than ‘entrepreneurship porn’ seems

Starting a business isn’t
always exhilarating. Elon Musk pictured.
Pascal Le Segretain/Getty Images

• Starting a business
  isn’t as exhilarating as it can seem, experts say.
• The rise of “entrepreneurship porn” is luring many
  ambitious young Americans into launching their own companies,
  when they might be better off joining a more established
  organization.
• If they do decide to found a company, these
  entrepreneurs should at least be adequately prepared, instead
  of simply diving in
  headfirst. 
  Entrepreneurship isn’t just
  about risk-taking and passion.

Tomas Chamorro-Premuzic has been teaching MBA students for more
than 15 years.

When he first started teaching, all his students wanted to work
for corporate giants like Goldman Sachs, IBM, and Unilever.

A decade later, Google, Facebook, Apple and Amazon were the big
draws.

“Now,” he told me when we spoke by phone in July, “the vast
majority tell me, ‘You know, I’m going to be a startup guy. I’m
launching something. I’m going to create the next big X, Y, Z.”

“Who are we to crush their spirits?” Chamorro-Premuzic said. “But
I think we have a responsibility to inform people that the
probability of attaining that is really, really, really low, and
that to actually attain it, they’re going have to sacrifice so
many things.”

Today, Chamorro-Premuzic is a psychology professor at Columbia
University and the chief talent scientist at Manpower.
In one of the opening chapters to his 2017 book, “The
Talent Delusion,” he explains why many ambitious young
Americans today would be better off working for an established
company than trying to build their own business.

And yet many of these young Americans are hypnotized by stories
of entrepreneurs who, against the odds, made it big. Even if
they’re not prepared — personally or professionally — to launch a
business, they forge ahead anyway.

“People feel like, ‘Oh, I have an idea. I don’t like the idea of
having a boss. I’m going to be the next Elon Musk,'”
Chamorro-Premuzic said. “It’s not that easy.”

Telling people you’re an entrepreneur is ‘sexy’

The rate of new-company failure in the US is unclear. In 2017,

USA Today highlighted data from the Bureau of Labor
Statistics, showing that about 20% of new businesses survive
longer than one year. In fact, according to BLS data, that number
hasn’t budged since 1995.

But “entrepreneurship” is notoriously hard to define. Do
mom-and-pop businesses count? Or is it just high-potential
ventures? “Failure” is even harder to define: What if a startup
pivots or downsizes?

Mark
Zuckerberg.
Paul Marotta/Getty
Images

Still, Chamorro-Premuzic’s observations about entrepreneurial
overeagerness are echoed by academics and business people alike.

Morra Aarons-Mele, the
founder of Women
Online and The
Mission List, appears to have coined the term
“entrepreneurship porn” in a 2014
Harvard Business Review article, to describe “an airbrushed
reality in which all work is always meaningful and running your
own business is a way to achieve better work/life harmony.”

In the article, she makes the point that entrepreneurship is
hardly as liberating as it can seem: “Starting a company doesn’t
mean being freed from the grind; it means that the buck stops
with you, always, even if it’s Sunday morning or Friday night.”

When Aarons-Mele launched her companies, “I just wanted to make a
living,” she told me, and she knew that “I just never wanted to
go an office again for 10 hours a day.” But a couple years in,
something changed.

“I drank the Kool Aid,” Aarons-Mele said, “of being not just an
entrepreneur, but a woman entrepreneur. It was sexy.” She started
going to conferences and speaking at events for founders.

“It was only after I realized that I did not want to scale, that
really becoming this sort of entrepreneur with a capital ‘E’
would make me have to live a lifestyle that I didn’t want, that I
became a happy small business owner instead.”

Aarons-Mele knows firsthand that the word “entrepreneur” can
sound infinitely more appealing than “small-business owner.” She
suspects that can play a big role in people’s desire to scale
their company, and quickly. That is to say, entrepreneurship can
be as much about the founder’s ego as anything else.

“It’s a very American thing to be an entrepreneur,” Aarons-Mele
said. “‘Small business’ implies small. It’s a lot of what
ambitious people might even want to escape versus create.”

Too many aspiring founders think entrepreneurship is about
‘diving in’

Then there’s the problematic notion that starting a business is
all about taking risks.

“There’s something a little bit inherent in a lot of founders’
psyches of, ‘You’ve just got to dive in,’ that it’s the type of
thing that you can’t go and learn about before you do it,” said
Noam
Wasserman. The common misconception is that “you have to
fail, learn from that, pick yourself back up.”

Wasserman is the founding director of the Founder Central
Initiative at the University of Southern California’s Marshall
School of Business. When we spoke by phone in June, he told me
that this myth “heads off at the pass any of that inclination to
go and learn before you go and dive in.”

Wasserman’s observations recall those of Wharton professor Adam
Grant. In his 2016 book,
“Originals,” Grant wrote that, contrary to popular belief,
the most successful entrepreneurs
don’t quit their day job to start a company. One
University of Wisconsin study found that entrepreneurs who
kept their day jobs were 33% less likely to fail than those who
don’t.

Recent research also reveals just how important it is to wait
until you have enough experience before building a company.

An
MIT study found the
average age of a successful startup founder is 45. The study
authors found that work experience explains much of the age
advantage. They write in the
Harvard Business Review, “Relative to founders with no
relevant experience, those with at least three years of prior
work experience in the same narrow industry as their startup were
85% more likely to launch a highly successful startup.”

Indeed, Chamorro-Premuzic said that technical expertise in the
area where you’re founding a company is one of the most
“underrated” attributes of a successful entrepreneur.

‘It’s your baby, your everything’

I asked a few entrepreneurs to tell me about their experiences,
about how entrepreneurship porn had (or hadn’t) influenced their
decision to launch a company.

Jen Rubio, founder of direct-to-consumer luggage
company Away.
Daniela
Spector

Sophie Kahn took a relatively cautious approach: As she
told Business Insider’s Libby Kane, she kept her job at Marc
Jacobs while developing the plans for AUrate New York, the jewelry
company she cofounded with Bouchra Ezzahraoui and that’s raised
$2.6 million. Entrepreneurship, she learned, was both harder and
easier than she’d anticipated.

“Harder, because it’s truly all-consuming and you never
ever have a day off. It’s your baby, your everything, and always
with you,” she wrote in an email.

And “easier, because it doesn’t feel like work in the sense
that it’s your passion and
you 
want
 to work on it, and of
course since you’re free to make your own choices and set your
own schedule.”

Jen Rubio left her job at Warby Parker a few years before
cofounding direct-to-consumer luggage company Away, which has raised a
total of
$81 million. But Rubio says she and her cofounder, Steph
Korey, another Warby Parker alum, learned a lot from their
experience there: “Being on the ground floor of an early-stage
startup with that mentality allowed us both to build something
entirely new every day,” Rubio wrote in an email.

Rubio’s best advice for anyone considering starting a business is
“to be really specific about why you’re doing it and what
problems you’ll be able to solve in a meaningful way for your
customers; don’t start a business just because you think you have
have a great idea.”

‘Passion can become your peril’

Another persistent myth about entrepreneurship is that, once
you’ve got the product and financing in place, the people stuff
will come naturally. Many entrepreneurs, Wasserman said, are
completely oblivious to the importance of the people side — i.e.
who you hire and how you manage your company.

For example, some entrepreneurs figure that they’re already best
friends with their cofounder, so everything should be fine.
“Unfortunately, those happen to be the least stable of founding
teams,” Wasserman said.

But perhaps the most destructive misconception around
entrepreneurship is the
importance of passion.

At the start of every semester, Wasserman asks his students: How
important is passion for the “entrepreneurial magic?”

“We get a resounding, ‘Passion is critical. Passion is going to
be the main ingredient that is going to enable me to go and
succeed as a founder,'” Wasserman said. Then he presents them
with a case study “that drives home to them that passion can
become your peril.”

Specifically, Wasserman said, passion can mislead you into
thinking you’re readier to start a company than you are, or make
you believe that your idea is more valuable than it is. “You have
to really go and grab the founders by the lapels and have them
think deeper about these people issues,” Wasserman said, “where
the person that they’re dealing with is themselves.”