The Path to Entrepreneurship

I went to Stanford on Wednesday to give a lecture to a class of 60 students at the Department of Management Science and Engineering. The course was “Creativity and Innovation”, taught by Professor. Riitta Katila, who invited me to speak about Entrepreneurship.

It was interesting for me to observe what’s top-of-mind for a cross-section of engineering students at one of the world’s top universities. Here are some nuggets:

* I asked for a show of hands on how many of the students already have aspirations of becoming an entrepreneur. About 60% of the class.

* Many of the students are final year undergraduates, and already have job offers. The job offers seem to weigh heavily in the direction of Investment Banking and Consulting. They asked me, which is a better path? My answer: If the interest in entrepreneurship is serious, then neither is a good step as a first job.

* What about working for a big company, they asked. My answer: Working for a big company early on in life develops in you a very narrow skill-set, at a very slow pace, whereas, the range of skills required to become an entrepreneur is frighteningly wide. The resource constraint in starting a company is acute, and hence an entrepreneur needs to wear so many hats, that narrow skill sets tend to produce ineffective / mediocre entrepreneurs. Working for a startup may be a much better preparatory step, instead. Even if the startup fails, you would still pick up the skills necessary to become a strong entrepreneur yourself.

* But Google? Especially not Google. Free lunches, dinners, massages, dry cleaning, laundry and the rest will spoil your habits so badly, that you’d never be able to master the most important virtue in an entrepreneur: frugality.

* Both of the above (big company, Google) are okay for a short period of time, sometime in your career (if you have the patience for it), just as Consulting is also very good as a learning device. However, if all you have ever done is Consulting, then you don’t really learn to build anything, let alone a company.

I thought some of these points may be useful for others, beyond my class of 60 from this week. If you have other questions, please feel free to ask in the comments section.