There are exceptions to nearly every rule. All the same, it would be useful to understand the difference between Unicorn-Smart (US) entrepreneurs and Book-Smart (BS) entrepreneurs to understand why we should train more US entrepreneurs to develop more unicorns.
BS entrepreneurship is academic intelligence with the expertise to learn from books, take tests, and score well. This is the standard to be admitted to prestigious universities.
US entrepreneurship is balanced intelligence with the expertise to learn from books and from the streets. It is having the right mix of intellectual and practical expertise and using the right mix of technology and business skills. US entrepreneurs use their business skills to evaluate customers’ unmet needs, and their technology skills to develop the right solutions to unlock emerging industries. Examples include Gates, Jobs, Zuckerberg, Dell, and Bezos.
BS entrepreneurs focus on the technology and seek to develop a better product. They develop ventures based on the assumption that an advanced product will help them gain an edge. Herb Boyer was one of the first to split the gene. He co-founded Genentech. He was one of the rare ones to help build a unicorn where his contribution was limited to the technology.
US entrepreneurs are focused on the market and the strategy to dominate the segment. US entrepreneurs have the skills to get an edge by understanding customers’ unmet needs and analyzing how to better meet these needs with emerging technologies. They are usually the first to come up with the better solution to get a long-term edge in the right segment. Sam Walton honed his retail skills by learning how to succeed with large stores in small towns. After dominating rural America, he then turned his attention to urban America. Earl Bakken, the co-founder of Medtronic, was asked by Dr. C. Walton Lillehei to develop the battery-powered cardiac pacemaker. Dr. Lillehei had just lost a few young patients because the grid-powered pacemakers to which they were connected stopped when the power failed. Bakken developed the cardiac pacemaker in six weeks by using an electronic circuit found in a metronome and started the medical electronics industry.
The point: BS entrepreneurs do well where the advantage lies with the technology. US entrepreneurs do well where the advantage lies with the strategy and execution. 1% of unicorn-entrepreneurs were BS entrepreneurs. 99% were US entrepreneurs.
BS entrepreneurs want to be first movers, hoping to get a long-term edge. And the press keeps promoting the myth that it is great to be the first mover, even though a key study has shown that only 11% of first movers end up dominating their market. 50% fail and the rest are also-rans.
US entrepreneurs want to be first dominators to actually get a long-term edge. They often imitate the products developed by others, are mostly better at improving the business and the finance strategies, launching with control, organizing for an edge, and leading to dominate. Bill Gates did not develop a better product. He bought an operating system and licensed it to IBM when he learned that the company was looking to get into the PC market. Steve Jobs did not invent his iconic iPad, iPod, and iPhone. He imitated existing products but made them a platform for apps and dominated the industry. Bezos did not invent the Internet. He just found a way to dominate it, starting with books and growing with Amazon Web Services.
The point: BS entrepreneurs want to be first movers hoping this will give them an edge. US entrepreneurs want to be first dominators knowing it will give them a real edge. Most unicorn-entrepreneurs, like Gates, Jobs, Dell, Walton and Schulze (Best Buy), were not first movers. They were first dominators.
BS entrepreneurs learn the right technical skills and then seek to develop leading-edge products to succeed. They are often intelligent students who have no trouble getting into highly ranked universities.
US entrepreneurs learn or get the right technical and business skills. They often leave highly ranked universities – if the time is right. That’s what Bill Gates, Michael Dell, and Mark Zuckerberg did. Many unicorn-entrepreneurs did not wait to get business experience. When the emerging industries in which they were interested took off, they jumped on them – and dropped out of school.
The point: BS entrepreneurs focus on their education and degrees. On the other hand, US entrepreneurs enter a trend when it is emerging to get an edge before the industry has picked a leader, and in order to control the emerging industry. Brin and Page entered search when they were graduate students. That’s when opportunity knocked. The industry was emerging, and the need for a better search engine was evident.
BS entrepreneurs get institutional VC early, abdicate control to the VCs, and cede leadership to the CEO hired by the VC – often because they have not developed, have not proven, or don’t have, the business skills to build the business.
US entrepreneurs take off with the right financing to keep control of their venture and of the wealth they create. Some delay VC till after take-off to stay in control – this group includes Bill Gates and Jeff Bezos. Most avoid VC – this group includes Michael Dell, Michael Bloomberg, Sam Walton, Richard Burke, and Dick Schulze.
The point: Those who control the venture and the wealth created get to keep more of it.
MY TAKE: BS entrepreneurs rely on their technical skills to develop a unicorn technology and then let others control and lead the venture. US entrepreneurs rely on their technical and business skills, including sales and financing, to stay in control of their venture and lead it. BS entrepreneurs are 1% of unicorn-entrepreneurs. US entrepreneurs are 99% of unicorn-entrepreneurs.