Entrepreneurship: A Road Full of Paradox, Part II

In Part I of this post, we introduced five paradoxes that characterize the entrepreneurial journey. In  this edition, we’ll share five more. 

Paradox is defined as two truths that exist side-by-side, but which appear to contradict one another. Contrary to cookie-cutter, black and white answers to the challenges we all face, the notion of paradox points us toward the need to hold multiple (sometimes opposing) truths in tension with one another.

As shared in Part I, the nature of paradox demands the best from us. That’s to be expected when the answers to our challenges are in shades of gray. In the middle of paradox, we need to do our best creative thinking and bring our “A game”. Here are five more paradoxes that we’ll encounter on the entrepreneurial road.

Paradox Six: Failure sucks <> Embrace it

You will fail. And, it is ok to fail. Everyone will fail at something at some point in their lives. And most of us will fail multiple times. Some of history’s greatest influencers failed more times than they succeeded. And had they given up, we wouldn’t know the wonder of what they brought the world as we know it. Yes, failure is part of the entrepreneurial territory. The foundational activity of entrepreneurship is risk-taking, and sometimes risk-taking results in failure. 

All that said, our culture isn’t terribly fond of failure. We don’t like to talk about it. We don’t want to spend any length time thinking about it. It isn’t any fun, and frankly, it sucks. And we certainly don’t want to “embrace it”. But that’s exactly what we need to do. It is essential to pause, take time to examine what went wrong and contemplate what can be done differently in the future. This is the essence of embracing failure.

I (Tim) can recall being fired by a consulting client in 1999 during my brief, two-year stint owning and operating LifeVision, Inc. The San Jose, CA-based client had engaged me to design an expansive change management project, comprising training workshops, strategic planning sessions and an offsite leadership retreat. But somewhere along the way, the project had gone off the rails. As I took the time to embrace the failure and carefully reflect on it, I began to see how I had ignored some of the client’s core issues. I had been enamored with the opportunity to create a dynamic and energetic set of workshops, but had failed to help the company deal with some of its fundamental problems. The result – a failure for the client, a failure for me. As difficult as the circumstance was, I took the time to embrace it, ponder it and learn from it. That intentional embrace of failure has served me well in the 20 years since.

Now,  we all know someone who take the stance that the problem is always “out there”, not "in here." While sometimes outside circumstance will be to blame, rarely will failure be caused by a singular, external and isolated source. It’s usually a combo package. And somewhere “in there” is something that needs to be changed. So, it’s important to look internally and reflect on what YOU can do to make a favorable outcome more likely the next time. Embrace and learn from the failure, as opposed to just trying to put it in the rearview mirror sans processing. That said, the basic idea here is to get back up on the horse and try again. Amidst the learning, don’t get stuck, don’t get overly fixated on the negative. Internalize the lesson, dust yourself off, be resilient and get back up on the horse to face tomorrow.

Paradox Seven: Be a good steward of the resources entrusted to you <> Be generous

It’s important in the execution of our entrepreneurial tasks to be good stewards of the resources at  hand. A fastidious approach to managing your capital, your team and your time really does make sense. Too often we see a less than careful approach to stewardship, where young companies burn through tremendous amounts of capital and human resources with little to show for it.

At the same time, it is good to keep in mind the law of the farm. That is, if you sow generously, you will reap generously. If you live with an open hand, casting your bread upon the water (to use a biblical reference), it will come back to you multiplied. This is counter-intuitive, and it certainly seems to fly in the face of being a good steward of your resources. Yet it has been our personal experience that the more you open yourself up to serve and help others, the more you will be receive in return. 

I know what you’re (possibly) thinking. You likely feel maxed. Out of gas in terms of time, money and energy. Living open-handedly seems risky. Won’t it result in a shrinking resource base? And didn’t you just say that we need to be wise stewards of our resources? Well, that’s the nature of paradox! 

A couple of years ago, I (Tim) committed to participating in a vision trip to Haiti with a non-profit called Lifesong for Orphans. My wife Toni and I wanted to see firsthand the unique and entrepreneurial approach to missions that Lifesong was implementing. But as the trip approached, I began to feel I had made a mistake. The time away from work could be ill-afforded. There was a time-critical fundraise going on for one of our Serra venture funds and several personal commitments on my docket. But after landing in Port Au Prince, we experienced a really powerful few days in Haiti with the Lifesong team. And not long after returning, I engaged in follow up discussions with several fellow travelers. Ultimately, our fund received four sizeable investment commitments from relationships that developed on this trip. A small investment of time and energy had turned into quite a bounty in return. In one sense, I didn’t have the time and energy to invest in the vision trip….but turns out, as Toni and I opened ourselves to the opportunity, we received some beautiful gifts in return. 

Paradox Eight: Be as wise as serpents <> Be as harmless as doves.

Entrepreneurial enterprises often fail for lack of focus and lack of execution. So, it’s important to pay close attention to and remain fully committed to execution of a very focused business strategy. To reference another biblical adage, we would be well advised to execute in a manner that is “as wise as a serpent.”  In other words, shrewd.

That said, the adage goes on to say “…but be as harmless as doves.” Which means we would be well advised to exude grace and care for those with whom we are doing business. Shrewd, yet full of love. What a strange, paradoxical combination…and pretty tough to pull off, I might add! 

There was an instance about two years ago where our firm was being strongly considered for a large commitment from an institutional investor. This deal would have been a game changer for our fundraising effort, and to say we were excited was an understatement. We dotted all of the i’s and crossed all the t’s. There were numerous interactions, executed with aplomb. We had executed shrewdly, and we were all but assured that the final approval was a formality.  But we did not receive the commitment. And there was no rational explanation provided. Frankly, it was a huge blow. While it was tempting to give the investor what-for, we did our best to respond with grace. We thanked them for their time and said we’d keep in touch. We were, in other words, as harmless as doves. I believe our dignified response to the “no” left a positive impression. And who knows what might happen down the road?

Paradox Nine: It’s all about the customers <> It’s all about the employees

It is common to hear “it’s all about the customer,” or “the customer is always right.” And certainly, customer-focus is a hallmark of successful organizations. If you don’t get customer focus right, the business won’t last long.

But in order to really focus on serving customers well, companies should pay a higher priority attention to employees. Because without healthy and passionate employees, there will be no customers to serve. 

For many years at Serra, we have touted something called TGIM (Thank God It’s Monday) Culture. Essentially, TGIM Culture is all about leaders connecting each team member to the overall vision and mission of the company while creating a robust and challenging work environment. It’s about openly recognizing each member’s contributions, ensuring free flowing communication, sharing the company’s success with all and honoring people in all they do. When TGIM Culture is intentionally implemented, employees feel happier, more empowered, and overall morale and motivation goes way up. And, they’re in a place where they can render exceptional service to customers.

Of course, there will be times when the dual core values of serving customers and serving employees clash. There will be the circumstance where employees are asked to sacrifice in order to serve a customer well. But if the leaders of an organization have done their best to create TGIM culture, these types of challenging situations will be more successfully resolved. Ultimately, TGIM Culture is about creating an optimal environment where employees thrive AND customers have their socks knocked off with great service.    

Paradox Ten: Lead <> Serve

For our final paradox, we present a close corollary to paradox nine above…and one that is at least as difficult to live out! Truly effective leadership begins with the heart of a servant. This paradoxical notion – servant leadership – has been popularized by such writers as Peter Block, James Autry, Stephen Covey and Robert Greenleaf. But its origin goes back from much further, finding its roots in the teachings of Jesus. 

If we aspire to greatness, we would do well to love and serve those around us. Yes, there are plenty of contrary leadership models in operation all around us. And some of them have been pretty successful. But our personal life experience and encounters with hundreds of leaders over time has confirmed that the best leaders, the ones whose legacies are most enduring, have come to their positions through serving. Leading by serving. A paradox worth wrestling with.

And that completes our (far from exhaustive) list of ten paradoxes you’ll encounter on the entrepreneurial road. There are of course many more. May the wind be at your back as you embrace and apply these powerful truths to your lives, your organizations and to those around you! 

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Entrepreneurship: A Road Full of Paradox, Part I

Two roads diverged in a wood, and I –

I took the one less traveled by, 

And that has made all the difference.– Robert Frost

Entrepreneurship – a road less traveled. A road fraught with risk, challenge, potential failure. A road requiring commitment, vision and perhaps most importantly, resilience.  

Entrepreneurship – also a road characterized by paradox. At any stage of the journey, there are often two truths that exist side-by-side, but which appear to contradict one another. 

This paper is Part One of Two, a brief survey of 10 paradoxes that characterize entrepreneurship. It’s an exploration of how paradox makes this particular “road less traveled” difficult to navigate but exhilarating, challenging and fulfilling at the same time. The nature of paradox demands the best from us. Our best creative thinking. Our best effort. And paradox dispels the notion of “one right answer” and “the best way to do things.”

Fellow entrepreneurs, if you can embrace paradox and press into it, you just might experience the success and satisfaction you seek.

Paradox One: Envision a future that is blazingly bright <> Don’t presume on the future

Most entrepreneurs are very serious about their mission, their particular reason for being in business. Most entrepreneurs are also able to articulate and envision a specific, successful picture of the future – the hopeful result of executing on their mission. Having a compelling, expansive and adaptive vision is a key ingredient in setting the frame for where the company is going and inspiring the team to stretch themselves in its pursuit.  

But at the same time it is vitally important, particularly for entrepreneurial leaders, to not presume on the future. To not become so enamored with a vision (and your sales pitch of it to others) that you lose focus on the day-to-day tasks at hand. While it is necessary to dream big, it is perhaps more important to sweat the small stuff. While a blazing bright vision is necessary to inspire employees and on-board investors, know that matters mundane are what will ultimately build the successful future.

Paradox Two: Build a fundamentally strong foundation <> Take appropriate risks

Most leaders know that it’s important to build a solid foundation for the company.  You need to assemble the right team members, put proper systems in place, make sure the company is responding to the voice of the customer, all while ensuring that rock solid, quality products and services are delivered to the marketplace. These are all essential for success. But in business, it is also necessary to take appropriate risks which will set the company apart.  Consider coloring outside the lines, because large advances in a company’s evolution are often the result of such risk taking. 

An example from our own company’s history is a case in point. When Serra Ventures launched ten years ago, it was a boutique consulting shop focused on providing guidance in the disciplines of business development, strategic planning and capital formation to high tech startups. Indeed, this set of services reflected the skillset of the two founding partners. Business was good, and we were successfully helping our clients to build effective companies. But the market was consistently telling us that there was an opportunity at hand, should we choose to risk it. There was an obvious “funding gap” for early stage companies here in the Midwest. By launching our first micro venture fund, we were taking a bit of a leap. Ten years later, we’re managing three funds, approximately $70 million in assets, and have invested in over 70 companies.  We’ve transformed our company into a venture firm that certainly still provides consulting – but primarily in the context of our portfolio. Taking that risk has made all the difference in who we are today and where we’re headed for the next ten years.

Paradox Three: Continuously innovate <> Just get something into the market that works

Entrepreneurial organizations are known for innovating and bringing disruptive solutions to the market that meet needs of customers in a unique way. In order to stay ahead of the competitive curve, high tech startups often form around the very concept of pushing the envelope of product innovation. And that’s to be expected. In our venture business, we see a never-ending number of pitches from awesomely innovative companies. 

But all the same, over-innovating or over-developing a product can be fatal. We’ve seen this flaw with startups that are engineering-centric or “tech heavy”, boasting a highly talented team that is driving toward the perfect product. And while we appreciate this sentiment, there is danger lurking if a company cannot “just get something into the market that works.” Call it a minimum viable product if you wish. Or perhaps a fundamentally sound product without the bells and whistles. Establish your market position by serving up a highly functioning, solidly performing product that meets the needs of a distinct group of customers. And from that position of strength, continuously innovate and improve. 

Paradox Four: Conceive and diligently prepare your strategic plan <> Be open and embracing of spontaneous opportunities

The nucleus of Serra’s original consultancy model consisted of carefully executed strategic planning sessions, where we enjoyed multiple interactive sessions with client teams to evaluate the market, conduct SWOT analyses, identify key issues and the like. And the end result of these sessions was a very solid, actionable plan to guide the company over the ensuing six to 12 months. Yes, strategic planning is important. Assembling a specific set of objectives, strategies and action steps, with agreed-upon time frames and assignment of responsibilities is key. 

At the same time, the plan must not be so rigidly conceived and executed that the team ignores spontaneous opportunities that present themselves. Might the serendipitous or spontaneous be a new avenue for the company to explore? Might not these opportunities augment or parallel the path you’re already on in some way? Or provide just the right catalyst for the company’s existing products and services?

iCyt Mission Technology is one such case in point. Serra Ventures’ CEO Tim Hoerr was co-founder of iCyt, a company formed in the early 2000s to develop high speed, biological cell sorting instruments. A well developed strategic plan was in place from the outset of the company. But along came an unexpected and certainly unplanned opportunity to partner with Coherent Laser on a small footprint, solid state laser system that could be retrofitted to in-field cell analyzers and cell sorters. While at first, the Coherent partnership seemed to be a potential distraction from the company’s core mission, the iCyt team embraced the idea as a potential way to build awareness in what was a fairly crowded industry with formidable competitors. Indeed, over a few years’ time, iCyt became well known for its Lyt laser system based on Coherent’s technology. The reliable and highly functioning Lyt laser system paved the way for iCyt’s sophisticated cell sorting system, the Reflection, introduced years later to great success in the marketplace. The Lyt laser pointed the way to and legitimized the Reflection and similar such cytometry product offerings ultimately leading to the acquisition of the company by Sony.

Paradox Five: Commit to excellence.  <> Stop. Rest. Wait. Renew. 

The best tech startups are committed to excellence in everything they do. Systems. Processes. People. Product offerings. You name it, excellence is insisted upon. Yet some of what passes for “excellence” in the entrepreneurial world is an overly zealous commitment to work. Overwork, in fact.

For entrepreneurial leaders, too much work leads to too much stress. Exhaustion and burn-out aren’t far behind. Such overwork leads to a host of bad things. A decrease in personal effectiveness for one. A failure of one’s relationships for another. And a dysfunctional work environment. 

The Serra team has observed that our most successful executives find time to rest and renew. They are absolutely committed to excellence. Yay. But just as committed to being refreshed. This paradox, if properly managed, will enable you to work smarter and be more effective. In the resting, stopping, waiting and renewing, you will be enlarged and equipped to keep on keeping on.Counter intuitive? Perhaps. Refreshingly powerful and effective. Absolutely. 

Stay tuned for the next segment of entrepreneurial paradoxes!

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