Patrick J. McGinnis is a venture capitalist and private equity investor who founded Dirigo Advisors, after a decade on Wall Street, to provide strategic advice to investors, entrepreneurs and fast-growing businesses. He is also a 10% entrepreneur, investing in, advising and launching a diverse portfolio of companies and investments in the United States, Latin America and Asia. A graduate of Harvard Business School, he writes for Business Insider, the Huffington Post, Boston Magazine and Forbes. He lives in New York City.
If you ever want to develop a keener sense of gratitude, try writing a book. It should be the loneliest of endeavors, and at times it is, but mostly you are sustained by the kindness and encouragement of others.
The 10% Entrepreneur is the result of several years of discussions and experiments. First and foremost, I must thank everyone in my 10%, all the 10% Entrepreneurs in this book, as well as the many individuals who provided background interviews. All of your contributions and ideas were instrumental to me.
Jason Haim, it’s hard to imagine having a friend with stronger intellect or a better compass—never better.
Geoff Gougion, having the Digital Don Draper in my corner is such a privilege.
Marcelo Camberos, you taught me so much about entrepreneurship, 10% or otherwise. Sos un maestro—El Gato.
Samara O’Shea, you were my writing Sherpa and the first person to tell me I just might have a book in me.
Xin Zeng and Ben Schreckinger, you were the catalysts; Danielle Hootnick Kaufman and Katherine Liu, our many conversations were so critical to shaping my thinking; and Irene Hong Edwards, you’ve kept me sane and social for over a decade.
Fraser Simpson, you reminded me that to play the Great Game, you’ve got to be fearless.
Chellie Pingree, from one Mainer to another, I can’t thank you enough. Also, a big thank-you to Will Blodgett and Carolyn Tisch Blodgett, for arranging a very chilly and productive period of writing.
Susan Segal, working together was an unforgettable adventure to which I owe so much of the content of this book.
Luciana Isella, that amazing gift, handed to me on a street in Buenos Aires, brought me lots of good luck and maybe even a little divine intervention.
For reasons big, small, and medium, I must also thank Greg Prata, Felix Dashevsky, John Leone, Ben Wigoder, Michele Levy, Florencia Jimenez-Marcos, Terry Chang, Helen Coster, Jordon Nardino, Davalois Fearon, Allison Stewart, Lars Kroijer, Dan Mathis, Brad Saft, Amy Calhoun Robb, Jay Sammons, Ariel Arrieta, Gonzalo Costa, Andrew Watson, Fiona Aboud, Richard Baran, Debora Spar, Zia Chishti, Mohammed Khaishgi, Hasnain Aslam, Ben Wu, Nihar Sait, Sana Rezwan Sait, Santiago Tenorio, Chris Carey, and Ali Rashid, as well as Tom Clark, Phil Tseng, Suken Shah, and the entire Wobbly H family.
A special thanks also goes out to Luke Masuda, Nicolas Walters, Gary Crotaz, Vanessa Beckett, Josh Weedman, Andy Lee, Matthew Stoller, Cate Ambrose, and Leslie Pierson, for making introductions that helped me immeasurably.
To my godchildren, Finley Clark and Thomas Gougion: get ready to start your 10% in a few years.
Writing a book is a marathon, and with the team at Portfolio, I have the best coaches I could ever imagine. Adrian Zackheim, your support and vision have been a constant, and I’m grateful for both. Joel Rickett, you understood this idea instinctively and you, along with Niki Papadopoulos across the pond, took a chance on me. Emily Angell and Kary Perez, your early guidance made the book better from top to bottom. Will Weisser, Tara Gilbride, and Taylor Fleming, your creativity and energy have been invaluable. Last, but certainly not least, Bria Sandford, you came at just the right time and it made all the difference. It’s great to have someone so, dare I say, flinty on Team 10%.
I must also thank my multitalented agent, Mildred Yuan, who understood and shaped this idea from day one. Every interaction is a pleasure and an education that brings out my best.
Finally, to my family: Mike McGinnis, I’m happy to have a brother whose advice always rings true. Robert and Sonia McGinnis, you were so insistent that I try writing that I gave in to your wishes, wrote half of a terrible novel, threw it away, and then started writing this book. For that and for so much more, thanks, Mom and Dad!
I hope that by reading this book you are taking the first steps in what will become a lifelong commitment to 10% Entrepreneurship. Please keep in touch and send me ideas, feedback, edits, comments, or questions. In order to continue the conversation, stay on top of updated information, and access resources that will help you in your work, find me online at:
Web site: www.patrickmcginnis.com
Twitter: @pjmcginnis—tag your tweet with #10percent Facebook: www.facebook.com/The10PercentEntrepreneur
Managing Financial Capital: Sample Spreadsheet Templates
Sample Professional Biography
Patrick McGinnis is the managing partner of Dirigo Advisors, which provides strategic advice to investors and businesses operating in Latin America and other emerging markets. In this capacity, he has advised the World Bank and the International Finance Corporation on projects related to private equity and venture capital. In 2013, Patrick coauthored a World Bank Policy Working Paper titled “Private Equity and Venture Capital in SMEs in Developing Countries: The Role for Technical Assistance.” He also serves on the Boards of Directors of The Resource Group and Socialatom Ventures, a seed investment fund based in Medellín, Colombia.
Additionally, Patrick is a 10% Entrepreneur, having made angel investments in companies in the United States and Latin America. These include: ipsy, Bluesmart, SATMAP, NXTP Labs, WeHostels, Everbright Media, the Fan Machine, Preference Labs, and Morton & Bedford. He also serves as an advisor to Bunny Inc., Bluesmart, Posto, Preference Labs, and Everbright Media.
Prior to founding Dirigo Advisors, he was a vice president of PineBridge Investments (formerly AIG Capital Partners), a global emerging-markets investment firm. At PineBridge, Patrick sourced, structured, executed, and monitored growth equity investments in Latin America, Central Europe, the Middle East, and Asia. Patrick also advised portfolio companies on matters including strategic and financial planning, capital structure, acquisitions, business development, and exit opportunities.
Before joining PineBridge, Patrick was an investment professional at JPMorgan Partners, working on the Latin America team in both New York and São Paulo. He served on the Board of Directors of Hispanic Teleservices Corporation, a Mexican outsourced contact center, and was an alternate director at Freddo S.A., Argentina’s leading artisanal ice cream retailer. Patrick started his career as an investment banker in the Latin America group of Chase Manhattan.
An avid traveler, writer, and speaker, Patrick has visited more than seventy countries. He writes about travel, technology, and business for Forbes.com, the Huffington Post, Boston magazine, Business Insider, and the Latin America Venture Capital Association. He is a frequent speaker on the topics of entrepreneurship, venture capital, private equity, and emerging-markets investing, with appearances in the United States, Mexico, Colombia, Argentina, and Mozambique.
Patrick sits on the Board of Trustees of the New York Youth Symphony. He is a member of the Business Advisory Network of NESsT, a not-for-profit that develops sustainable social enterprises that solve critical social problems in emerging-market economies. He is also a Young Trustee of Atlas Corps, and sits on the Steering Committee of the Young Professionals of the Americas.
Patrick graduated magna cum laude from the School of Foreign Service at Georgetown University, where he served a one-year appointment as a Rotary Ambassadorial Scholar at the Universidad Torcuato di Tella in Buenos Aires, Argentina. He holds an MBA from Harvard Business School.
He is fluent in Spanish, Portuguese, and French.
‘For four years, while working a full time job, I was also a 10% Entrepreneur. I didn’t know the phrase then, I just knew I had more money, more fun and more opportunities than I’d ever had in my life. If any of those sound like things you want more of, read this book!’ Jon Acuff, author of Do Over
‘Entrepreneurship is not one size fits all. It can take many shapes and forms. There’s immense value to testing ideas or weaving entrepreneurial qualities into your life before taking the plunge. The 10% Entrepreneur will tell you how’ Christine Tsai, founding partner of 500 Startups
‘We think of entrepreneurship as a big, scary thing, involving blind leaps of faith and sweeping acts of disruption, not for the faint of heart. Yet in today’s ever-changing world, everyone needs to act more like an entrepreneur and take risks – or risk being left behind. In his debut book, McGinnis delivers a winning game-plan for assuming 10 per cent more risk, more creativity and more (ad)venture in your everyday life for 100 per cent more satisfaction. Entrepreneurship is a smart choice for everyone – and so is reading this book’ Linda Rottenberg, co-founder and CEO of Endeavor and author of Crazy is a Compliment
‘In a shifting corporate landscape, entrepreneurship no longer has to mean all-or-nothing endeavours. Patrick McGinnis uses his own expertise as a “part-time entrepreneur” to illustrate a proven solution for you to become one, too’ Keith Ferrazzi, author of Who’s Got Your Back and Never Eat Alone
Complacency isn’t something that happens overnight. No one gets out of bed in the morning, looks in the mirror and thinks, “I guess I’ll be complacent,” then shrugs and heads back to bed. Instead, it creeps up on you. Early in my career, I accepted a job that I knew was not going to be a good fit. When I signed the offer letter, the knot in my stomach confirmed my doubts, but I had no other options and I needed to deal with a mountain of student debt. By my third month on the job, when I took a 45-minute nap under my desk in the middle of the afternoon, I realized I’d grown dangerously complacent. The next day, I started a job search and soon made the fateful move to AIG.
Later, in the aftermath of the global financial crisis, I found that it wasn’t so easy to move on to another job. In the post-apocalyptic economy, I was basically trapped at AIG. Rather than doing something productive or just taking a siesta, this time I opted for petulance. I removed all signs of life from my office, taking books, notebooks, even pictures off the surface of the desk and putting them into cabinets and drawers until the glassed-in room looked completely empty from the hall. In essence, I erased myself from the workplace in a symbolic gesture that I sarcastically referred to as the “clean sweep.”
At this very moment, complacency is pervasive in the American workplace. Even if you’re not snoring under your desk or taking the passive-aggressive route like I did, you may very well be checked out. A 2015 Gallup study of the state of the American workplace found that nearly 70 percent of people are either “not engaged” or are “actively disengaged.” By my count, that means that tens of millions of workers might as well be doing the “clean sweep,” because their heads are not in the game.
When Sure Bets Are No Longer Sure
It’s not surprising that so many people are sleepwalking their way through their professional lives. Climbing the corporate ladder is not the barometer of career achievement that it once was. Instead, it’s yesterday’s dream. At a time when the global economy oscillates from one economic crisis to another with disturbing regularity, few people expect to stick around a company long enough to collect a gold watch upon retirement. Economic cycles aside, it’s nearly impossible to plan for the future thanks to the merging, offshoring, outsourcing, and downsizing that continually reshape the contours of the modern workplace.
The U.S. Bureau of Labor Statistics reports that the average member of the baby-boomer generation changed jobs every 3.5 years between the ages of twenty-two and forty-four.1 This trend looks set to accelerate: 91 percent of millennials expect to stay no more than three years in a particular job. At that pace, a typical worker will bounce around twenty or so times in the course of a career.2 Put simply, the old meritocratic mind-set through which many of us were taught to view our careers—“work hard, keep your head down, and move ahead”—no longer applies in a world where looking to grab on to the next rung of the ladder is not a viable strategy.
Even the traditional paradigms of prestige, paths like finance, law, and medicine, are no longer guaranteed to lead to financial success. There are no sure things, and it’s not just because of the damage caused by the 2008 global financial crisis. In the last five years, the number of “front office” employees at Wall Street firms, people like investment bankers and traders, fell by 20 percent globally, while changes in pay structures and a heavy increase in regulation greatly affected compensation.3 Things are no better in the legal and medical professions. Only 40 percent of 2010 law school graduates work in law firms and approximately 20 percent work in jobs that do not require a law license.4 Perhaps that’s why a recent survey found that roughly 60 percent of practicing lawyers would not advise young people to enter the industry.5 Similarly, only 54 percent of doctors said they would choose medicine again if they started over.6
If you can’t make it in the industries that were supposed to be no-brainers for success, then what does that say about the rest of the job market? The fact that there are no sure bets is not lost on the next wave of would-be professionals. Why go to school for years and rack up vast sums of student loans when the payout is no longer certain? It’s a lousy deal and the best and brightest know it. As a result, they want more than your average sit-in-a-cubicle, work-your-way-up-for-twenty-years type of office job. For them, the answer is entrepreneurship.
Visit a college campus today and you will run across many more aspiring Mark Zuckerbergs than aspiring investment bankers, even though bankers were traditionally said to be the “Masters of the Universe.” It’s not just that Zuckerberg can wear jeans and a hoodie to work and is way richer, although that doesn’t hurt. Entrepreneurial companies provide the kind of setting in which people who are just a few years out of school can build careers that combine autonomy and financial upside, all within a corporate culture that appeals to their values. They can also acquire the tools to someday launch an entrepreneurial venture of their own, if they so choose. Who can blame them for being attracted to this new paradigm? As technology disrupts and transforms even the most established industries seemingly overnight, thinking like an entrepreneur is now essential.
Entrepreneurship, Inc.
Unfortunately, thinking like an entrepreneur has little to do with the Hollywood version of entrepreneurship that has captured the public’s imagination. Just as the 1980s had Gordon Gecko, Wall Street, and “Greed is good,” we now have The Social Network and HBO’s Silicon Valley. In that sense, entrepreneurs, like yuppies or hipsters before them, have become a type. With the passing of each year, they somehow manage to generate newfound levels of hype. Flip through a magazine focused on entrepreneurship or read a few startup blogs and you’ll discover that nearly everyone is portrayed as independent, brilliant, edgy, and so innovative that they are beyond reproach. The message is unambiguous: entrepreneurs are the new pioneers, a fearless army of visionary warriors who will make untold sums of money. They will own the future.
What you are witnessing is something I like to call “Entrepreneurship, Inc.” Thanks to a combination of creativity and chutzpah, the people responsible for Entrepreneurship, Inc., have done a remarkable job of productizing and branding a human endeavor that has far more to do with hard work than with glamour. As a result, society has embraced a distorted and romanticized notion of what it means to build a business from the ground up. The entrepreneurship-industrial complex knows that showing the real nature of starting a company is lousy product positioning, and telling people to work harder isn’t alluring. The truth is that entrepreneurship is an all-consuming career choice, and unless you are a masochist, there is nothing particularly romantic about failing over and over again until you find the right formula.
It doesn’t help that companies themselves muddy the water through their origin stories. It seems like every new venture was dreamed up in a garage, a dorm room, or while contemplating the sunset from a beach in Thailand. Telling those origin stories is far more inspiring than admitting that you came up with your startup idea while sitting in a poorly lit cubicle somewhere in Ohio.7 Take the legend behind Apple. The California garage where Steve Wozniak and Steve Jobs started Apple is now a pilgrimage site. Aspiring founders and Apple fanboys take selfies out front. That makes Apple the world’s most successful product of the classic Silicon Valley garage story. Except it isn’t. In 2014, Wozniak admitted that the whole garage story was a “bit of a myth,” since the “actual work was being done . . . at my cubicle at Hewlett-Packard.”8
The vast majority of founders are more obsessed with results than with feeding the entrepreneurship frenzy—and with good reason. If you are an entrepreneur and you believe your own hype, your investors should show you the door before you lose all their money. It’s dangerous to take your eye off the ball and waste valuable time and energy reveling in your awesomeness. You may look the part and talk the talk, but results are what drive the value of any company when all is said and done. Looking the part without doing the work is a surefire way to end up being a first class “wantrepreneur.”
That’s what’s so unfortunate about the glorification of entrepreneurship. Glossing over the substance to focus on flash leaves one critical factor out of the conversation: full-time entrepreneurship is not for everyone. There is no shame in deciding that you don’t want to be an entrepreneur today—or ever! In fact, choosing a more structured path may be one of the best and most important decisions you ever make. Jumping from a stable career into something that is risky and in which you are unsure of yourself shouldn’t be done recklessly. You need to go in with your eyes open.
Five Reasons Not to Be a Full-time Entrepreneur
My brother, Mike, is a jazz musician in New York City. Over the years, he has invested countless hours developing his skills and his reputation in the music scene. In the process, he’s lugged his saxophone all over New York and all over the world, gradually moving up in his industry and making a name for himself. If you ask him why he chose to be a musician, his answer is simple: music chose him. That was the only thing he ever wanted to do, and he made the necessary sacrifices to pursue his passion, especially in the early days of his career when he could barely pay the bills. With success, he’s found that he can live a much better life than he might have imagined a decade back. Perhaps he’ll even strike it rich someday. Still, if he were looking for fame and money, he would have chosen a different path. He once told me that he sees being an artist today as akin to being a person of the cloth. You’re doing it for passion, not for money, and in that sense, you’ve already struck it rich.
I see entrepreneurship in much the way that my brother sees a career in music. You don’t become an entrepreneur because you want to be rich or famous. You become an entrepreneur because it chooses you. No matter when you make the decision, you know in your gut that you just have to go for it. Perhaps you’re the person who has been launching businesses since you set up your first lemonade stand at the age of five. Maybe you knew from the outset that you were never going to work for anyone else. Or you didn’t expect to be an entrepreneur, but you reached a stage in life where you wanted to live differently than you had in the past. Regardless of how you get there, when you choose entrepreneurship, you accept that the success and the money are terrific if they come, but they cannot be the only drivers of your decision.
Despite all the hype from Entrepreneurship, Inc., it is too hard a road to travel if you do so for the wrong reasons, or without thinking long and hard about what lies ahead. If you’re considering that road, you should first think through these five perfectly rational reasons not to be a 100% Entrepreneur.
1. The Lifestyle Is Lousy
In September 2014, an entrepreneur named Ali Mese published a post on Medium titled “How quitting my corporate job for my startup dream f*cked my life up.” Mese, a former Bain & Company consultant, chronicled the unexpected personal, familial, and social stresses that resulted from his decision to leave the safe and prestigious world of management consulting to start his own company. Having been caught off guard himself, Mese wanted to make sure that all the bored consultants, understimulated corporate types, and frustrated bankers who dreamed about startups from their cubicles also saw the other, darker side of Entrepreneurship, Inc., so he laid it bare. Clearly, the risks and trade-offs of pursuing entrepreneurship are on a lot of people’s minds—his blog went viral, racking up millions of views.
The time and focus required to launch and lead a company takes a toll on you and everyone in your life. You have to rethink your financial goals, your lifestyle, and your definition of success, all while being plagued with self-doubt. It’s generally believed that divorce rates among startup founders are the highest of any occupation, as a result of the long hours and stress.
Even if your company thrives, your lifestyle may not be luxurious. If you leave your corporate law job to open a bakery and finally make a business out of your grandmother’s famous cookie recipe, you may find yourself working far more hours for a fraction of the pay. Sure, you have “freedom,” but you also have long hours, demanding clients, and the stress of making ends meet on less money, at least at the outset. Lives, like careers, are rarely in balance, and you may find that your “dream job” has even less equilibrium than your previous job. After all the hard work and sacrifice, how terrible would it feel if you opened your bakery only to discover that you should have stayed at the law firm? It took you going all in to realize that while you enjoyed baking a few batches of cookies for your friends, you hate doing it twelve hours a day.
2. You Can Ruin Your Finances
A recent study of more than ten thousand founders revealed that 73 percent of respondents pay themselves less than $50,000 a year in cash compensation.9 Those figures are surprisingly low when you consider how much responsibility they carry on their shoulders. They recruit teams, craft and execute growth strategies, and try to raise millions of dollars of venture capital from deep-pocketed investors who expect the founders to make them richer. All those pressures and obligations for less than $50,000 a year sounds like a raw deal, right?
It may sound like a raw deal, but that is generally the deal. Investors expect startup founders to put all their eggs in one basket and make money as the value of their shares in a company increase. Now consider that the typical venture capital–backed business takes between five and seven years to go from raising its first round of capital to producing returns for its shareholders, including the founders.10 Even Facebook, one of the undisputed tech heavyweights of the last decade, took more than seven years to reach its IPO.11 So even if your company is wildly successful, you’re going to have to wait to see the payoff.
Jonathan Olsen, an entrepreneur who’s both founded and invested in early-stage ventures, puts it best: “If you want to be an entrepreneur, you have to give up things, starting with your flat-screen TV.” Beyond the TV, you may no longer be in a position to help out your parents with unexpected costs and you won’t be writing eye-popping checks to your alma mater. If you’ve gotten used to being the one who takes care of those around you, having to count every penny is not an insignificant change. Everyone likes to tell stories about the founder who ran down his savings and lived off multiple credit cards before finally making it big. No one talks about the founder who couldn’t repay those bills.
3. You’re Abandoning Status and Affirmation
Your job denotes your place in society and a prestigious career brings respect and affirmation from your colleagues, your family, and your friends. If everyone knows you as that guy who makes a lot of money in finance or that woman who is next up to make partner, then you might have grown accustomed to being seen in a certain light. Changes in your career affect the way you are perceived by your peers, society, and even yourself. Endangering this affirmation can mess with your head.
If you’ve worked for an established company, you are used to the security and structure that are woven into the DNA of those types of organizations. Pursuing new opportunities means breaking routines and leaving behind old comforts. Once the thrill of liberation wanes, abandoning well-appointed corporate offices for startup digs means that you will have to get used to doing all kinds of grunt work. Say good-bye to nice hotels and expense account dinners. You’ll also trade in your business cards for new ones, leaving behind a well-known corporate logo in exchange for a card that elicits looks of confusion. Finally, you’ll have to learn to swallow your pride. At some point, you’re going to be pitching your business to people who sit in the very comfortable corporate offices that you left behind. Some of them, maybe most of them, are going to say, “No, thank you.”
Even if you see yourself as someone who is independent, who doesn’t look for approval from others, and who knows what you want, the transition can be trying. Most of your old friends and colleagues will have no idea what you’re doing for a living, so explaining yourself to people will not be as easy as it once was. When you do, some people will look at you skeptically while others will struggle to keep their eyes from glazing over. These people may include members of your family.
4. You Don’t Have the Right Idea (Yet)
I was standing in the corner at a tech networking event when an excited young man stormed up to me. He had just come from a hackathon, a business plan competition in which teams of aspiring entrepreneurs work around the clock to develop an idea that could actually become a business. Tired but triumphant, he wanted to tell me about the mobile app he’d hatched with his team. Specifically, he wanted to know if he should drop out of college and throw all his energy into something he’d only just dreamed up. He caught my attention and I asked him to tell me about it. If this kid was willing to put everything on the line for his startup, it had to be something good. He smiled, stood a little taller, and responded: “It’s Tinder,” he grinned, “for dogs.” It took me nearly fifteen minutes to persuade him that when a dog is in heat, man’s best friend doesn’t really need an app to find a suitable mate.
No matter how hard you work, you need to have a solid idea and a plan to back it up. That’s the only way you’re going to build a team, attract investment, win over initial clients, and find the nerve to actually get going. The idea doesn’t have to be perfect— initial business plans rarely are—but it has to have promise.
An Inc. magazine poll found that 71 percent of founders hit upon the idea for their company based on problems they faced while at previous jobs.12 That means that your best bet is to stay put and keep your head down until you find an idea that can justify all the risks, costs, stress, and rejection you’ll face as you figure out if it will actually work. Once you have the right idea, you will focus all your time and energy on testing, validating, refining, and improving it. Until you get to that point, your only option is to bide your time. This is too important a decision for you to settle for something that’s mediocre.
5. Failure Sucks
Every once in a while, I hear the kind of cautionary tale that sends shudders down the spine of anyone who has ever thought of pursuing entrepreneurship as a career. One of the more memorable stories concerns a guy I’ll call “Mr. Unlucky,” one of the stars of his class at a top business school. While the rest of his contemporaries headed for Wall Street, consulting firms, or high-powered corporate positions, he opted for the first of a string of failed startups. Fifteen years later, Mr. Unlucky created quite a buzz among his former classmates when he moved back in with his mother. He was financially devastated and, apart from the gilded name of his alma mater, he had nothing to show for his efforts, since the only companies on his resumé were failed and forgotten. Mr. Unlucky wasn’t stupid and he didn’t necessarily make bad decisions. In fact, given his intellect, his pedigree, and his network, he just as easily could have hit it big. But things hadn’t worked out in his favor. So instead of starting his days looking out over the ocean from the deck of his yacht, he ate Cheerios across the kitchen table from his mom.
Common perceptions of entrepreneurship make the march toward becoming a millionaire, or even a billionaire, seem inevitable. Here’s the dirty little secret: the odds are you’re going to fail. Consider a recent study by Harvard Business School professor Shikhar Ghosh tracking the fate of more than two thousand startups.13 Ghosh reports that roughly 75 percent of them did not deliver promised returns to investors, while 30 percent to 40 percent returned little to no capital at all.14 His findings speak to a fundamental reality of entrepreneurship: failure, like it or not, is part of the DNA of building new companies. In some circles, it is even celebrated as a badge of honor, an essential building block of what will eventually be a successful outcome, if not at this company, then at the next one. As long as you take something from the experience, they say, the failures will become hazy memories when bathed in the sunny glow of success. Legendary venture capitalist Marc Andreessen has even coined the term “failure fetish” to describe the somewhat paradoxical exaltation of failure in entrepreneurial circles. Raising a lone voice against all those failure fanatics, Andreessen has gone on the record to say something that seems pretty obvious to me: he thinks failure “sucks.”15
If your chances of failure are better than even, then what happens if the odds work against you? If you fail multiple times, can you continue to bear the associated financial, emotional, and social costs? At some point, the price of entrepreneurship starts to escalate. This reality is especially stark if you want to get married, start a family, or buy a house. If you haven’t yet “made it,” the implications are clear: failure sucks, and you may not be able to afford it.
Entrepreneurship Is Not an All-or-Nothing Proposition
So now that I’ve given you five perfectly good reasons not to pursue full-time entrepreneurship, it’s time to turn to the clear benefits that come with pursuing part-time entrepreneurship. In an ideal world, your job would provide you with an optimal mix of stability and upside—that would be the Holy Grail. There’s only one problem. Like the Holy Grail, that kind of job is also impossible to find; people have been looking for both of them for the past two thousand years. That leaves you with a dilemma. If you’re seeking upside, the conventional wisdom suggests that you should opt for entrepreneurship. The problem is that doing so entails considerable risks. Conventional wisdom also says that traditional career paths are supposed to maximize stability, even though that notion is increasingly a relic of the past. Faced with these stark alternatives, you are limited to two seemingly irreconcilable and suboptimal paths. You go one way or you go the other, accepting that each has definitive downsides.
Fortunately, the conventional wisdom is obsolete and you do not need to choose one course over the other. If you abandon the idea that one job is supposed to provide everything you need, you will see that traditional careers and entrepreneurship are not mutually exclusive. Instead, they can be complementary. Rather than choosing between a stable day job and entrepreneurship, why not allow your day job to provide the stability, the cash flow, and the platform to integrate entrepreneurial ventures into your career on the side? By expanding your career laterally rather than vertically, you can channel a meaningful percentage of your time and energy into something far broader. In this sense, entrepreneurship can enhance your career and serve as an avenue to generate upside as well as downside protection, all without requiring you to assume the risk of going all in.