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Friday, August 16, 2013

Wanted: America’s Entrepreneurial Freaks of Nature

Some of the smartest people I know often tell me, “Businesses aren’t going to start growing again until consumer demand comes back.” Really? So we should just sit around and wait until economic growth magically returns?

Growth doesn’t just happen, and it’s not necessarily driven by demand. Growth comes from innovation and from entrepreneurs who create demand. Just look at the iPhone. Apple’s Steve Jobs didn’t create it because there was an insatiable demand for this world-changing device. People didn’t even know what an iPhone was until Apple put it on the market, and now they can’t buy enough of them -- and Apple has a nearly $500 billion market capitalization.

How much demand was there for Facebook before Mark Zuckerberg created it? Zero. Most consumers didn’t know what social networking was before their friends started signing up for Facebook.

Examples are everywhere of entrepreneurship and innovation driving demand: the dot-com bubble of the 1990s, for instance, which lifted America out of a recession and ignited one of the country’s great bull runs, producing Amazon, Google, Yahoo, and literally thousands of other businesses. The Internet itself didn’t spring up from consumer demand. Nor did the transistor, the automobile, the airplane -- you get the picture.

What will fix America’s current super-stalled economy, what will drive demand here and much-needed exports, and what will charge our dead labor market are entrepreneurship and innovation. As I have written before, there’s an oversupply of innovation in America and an undersupply of rare, truly gifted entrepreneurs. To fix this, we need to make identifying entrepreneurs as intentional as we do finding kids with genius IQs, or recruiting the next football, basketball, and baseball stars.

Gallup is in the final stages of completing a first-ever assessment of rare entrepreneurial ability. We have already discovered that the real entrepreneurial freaks of nature -- the Mark Zuckerberg types -- are only three in 1,000. These brilliant and insanely driven people have no limits to what they can build -- they are the potential game changers who can pump life into the economy and create good jobs.

The quick math on this: Among 30 million students in U.S. middle schools and high schools, there are approximately 90,000 who have rare genius-level entrepreneurial talent. America needs to find them all. These 90,000 potential Jeff Bezoses are national treasures who will not only someday jump-start the American economy, but will take it to new, world-leading highs.

What’s more, we can broaden the base beyond the exceptionally talented. Gallup’s research indicates that five in 100 people can build a small to medium-sized business of significance. These people aren’t as rare as the big builders, but as small business drives most of America’s growth and job creation, they can save our country’s economy and its very soul. There are 1.5 million students with the potential to build all-important small to medium-sized business. We need to find every one of these entrepreneurs, too.

We need a dragnet -- a nationwide dragnet for rare business builders.

Here’s the breakthrough I want to share with you: Gallup just tested 3,000 high school students in the Nebraska cities of Lincoln and Omaha, and found 150 young people who have the talent to build small to medium-sized businesses of significance. What’s really beautiful about our finding is that it is race- and gender-neutral; girls scored the same as boys and there were no significant differences in potential among blacks, whites, Hispanics, and Asians. This is profoundly inspiring news for one of the most multicultural nations on earth, much less a country that is making huge strides in equality for women. Think of the massive talent pool we have, just waiting to be unleashed on our stalled economy.

If America and its cities can create a coast-to-coast dragnet -- a sweep to find the top potential entrepreneurs, the entrepreneurial freaks of nature -- and then put them in internship programs and pair them with successful and gifted mentors, everything will change. Yes, demand will magically reappear, because these entrepreneurs will create new products that no one demanded or even thought of before, and this will create new economic energy where none previously existed.

15 comments:

Tom said...
August 17, 2013 at 7:53 PM  

Bernard of Chartres said "we are like dwarves perched on the shoulders of giants, and thus we are able to see more and farther than the latter. And this is not at all because of the acuteness of our sight or the stature of our body, but because we are carried aloft and elevated by the magnitude of the giants."

The premise of you post shows a lack of recognition that innovation is both evolutionary and recursive. Facebook represents nearly 30 years of evolution, dating back to the dial-up bulletin boards of the 1970’s which morphed along the way serving niche markets. If you looked at the history of the Internet (ARPANet, NSFNet, etc), you would see that much of the activities were around communities of interest. Facebook arrived at a time when the demand for these communities became more pervasive and the market looked for consolidation of these communities. The innovation of Facebook was in making the customer experience simple.

Apple never had the best technology. Steve Jobs’ greatest achievement was not technology innovation, but establishing a mindset on how the customer experience should be, in effect putting more power into the hands of the consumer. Jobs reset consumers’ expectations and forced competitors to raise their game. But remember that the iPhone was an evolution. Products such as General Magic and the Apple Newton may have been commercial failures, but laid a foundation for every smartphone and tablet that exists today.

I will not go into other foundational innovations, but one can’t overlook the achievements that came out of Xerox Parc or IBM Watson, among others.

You make a statement that there is too much innovation. I say we don’t have the right amount at the right levels. Conventional wisdom is that innovation happens within designated strategy groups. Yes those are needed, but never discount the potential of positive impact coming from the most unexpected source within your company.

Every person who works in a company has the ability to make small changes that, in aggregate can have a substantial positive impact. In teams I have led, I encouraged the team to casually think of ways to improve the workflow. The goal was to reduce their workload by 1 hour a week. With encouragement and mentoring, my teams achieved this consistently through a collaborative effort. We do not see this in most companies.

The last item you overlook is the power of organic innovation. Your suggestion of identifying these innovators though some kind of testing is something best left to science fiction writers. I highly doubt that anyone would have identified Steve Jobs as potentially having the impact that he did, particularly at an early age. Just remember the Scully period of Apple.

No, the answer doesn’t lie in testing, it lies in having a free society, one that encourages all people to think differently and listen to others. Dialogue and collaboration will enable the next generation to stand high on the shoulders of their predecessors.

Rudy Garza said...
August 19, 2013 at 11:26 AM  

Jim,
Exciting progress identifying the 150 students in Nebraska-we have a Venture Scholars program available to discuss a potential summer program for younger students-opening their eyes to Startups and Entrepereneurs from around the country.

Let me know if you would like to collaborate. We will have 30-40 graduate students participating this school year from top collegiate graduate programs. The summer is the only time we engage non-graduate level students.

Anonymous said...
August 19, 2013 at 10:43 PM  

Entrepreneurs are not freaks of nature. They are just regular folks who put their pants on one leg at a time just like everybody else - but they do get out of bed (usually early in the day), look for opportunity and work (usually late into the evening) with focus, persistence and determination. They don't make excuses, have children they can't afford, see themselves as victims or rely on EBT cards. We don't need to look for, pick or otherwise anoint them.

If you want to help, get the regulators and redistributionists out of the way and let investors and entrepreneurs reinvest their profits to create more jobs and opportunities.

Hey, those of us who were adults in the 80s have seen this movie before. Free enterprise works. Socialism doesn't. Viva Ronald Reagan!

Eric (Team AmERICa) said...
August 27, 2013 at 9:48 PM  

Nobody had to find Jeff Bezos or Mark Zuckerberg, so if these kids are the true entrepreneurs of the future, they will find their own way to success.

Paul Anthony said...
August 30, 2013 at 1:44 PM  

This is excellent and so true! Entrepreneurship is what built this country and what will continue to make it great in the future.

jesse gotschall said...
September 4, 2013 at 2:39 AM  

I would like to take this test...

Anonymous said...
September 11, 2013 at 1:19 PM  

I'd like to know how to develop that skill set!
- Wannabe Entrepreneur

Sara Robinson said...
September 12, 2013 at 2:06 PM  

One rock to turn over in your search: About a a third of truly great entrepreneurs are dyslexic -- which, alongside being a learning disability, is also a cognitive style that includes many important kinds of intelligence that enable entrepreneurs to "see differently."

Unfortunately, we do a terrible job of educating dyslexics in the US, which means that most of them will never reach even their minimum potential -- let alone become the innovators we need them to be. If we're hoping to increase that pool, the first step is to ensure that the students who have these gifts don't abdicate from their own educations before they hit middle school.

For more on this, I'd refer you to a book: "The Dyslexic Advantage."

BringFreedomBack said...
September 12, 2013 at 2:27 PM  

Start by listing things that totally irritate the shiesterbah out of you. Those are called opportunities. Try to figure out how you COULD solve it but don't solve it yet.
Then figure out if you can make a business case that works. Can I deliver value to the customer at a price point that entices them to ACTUALLY MAKE THE PURCHASE?
Done.
You have a business idea that works. Now take a risk and go build it.

Anonymous said...
September 12, 2013 at 8:28 PM  

I think you didnt understand what Jim was saying. Dialogue is great. Freedom of ideas is great. But its not drive and not a substitute for having the skills to build a team to realise these ideas into the market in a massive way to create consumer demand, buying, sustainable profits which in turn create jobs, pay taxes.

Robert Ashmun said...
September 13, 2013 at 5:33 PM  

Although you have an eye catching provocative title like most marketing, I find the discussion very interesting. I would like to hear how the test was designed, what will it show us, how is it validated, when will it be available for us to take and share with our entrepreneurial protégés if it really delivers meaningful results?

And to anonymous “Wannabe Entrepreneur” dated September 11, 2013, entrepreneurial skills can be learned. We teach up and coming entrepreneurs and business leader’s everyday as we entrepreneurially solve their seemingly insurmountable challenges! These companies range from startups to F500 companies to nonprofits in a diverse array of industries from entertainment to aerospace.

Anonymous said...
September 14, 2013 at 10:55 AM  

Often organizations say they want "innovation" but when the genuine entrepreneurs within try to bring ideas forward, the existing leadership become threatened or inadvertently shut down the initiative. Next Generation leaders and entrepreneurs move on...find them in business incubators, international development, and new "app" inventors, etc...

Nick Hernandez said...
September 14, 2013 at 12:23 PM  

Just because people have the talent, it does not mean they will have the opportunity to turn that potential into reality. Testing is a way of finding talent that may go unfulfilled. Also, it takes a community to create the potential opportunities that the entrepreneurial freaks of nature can see better than the rest of us.

Julieta Arango said...
September 20, 2013 at 6:30 PM  

Excellent article. Who dares to dream will have a motive, who dares to try will achieve success.

Tom Swartwood said...
October 4, 2013 at 4:15 PM  

let's not forget all the other potential entrepreneurs out there; we have a big and growing population of people 55+ who have talent and money and energy. They can be entrepreneurs too.

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