I visited San Francisco a week ago for a mixture of business and pleasure: a few friends had asked if I would consider joining a new business venture and my son was completing his training leading to his deployment to Afghanistan. It was an enjoyable visit in all regards, with time for good meals, serious conversations, and a nice mental stretch in a great city.
There was even time available to visit the ‘people’s park’ of the Occupy Wall Street movement down by the ferry terminal. Which, reflecting on the 1%, inevitably got me thinking…
The Small Business Administration reports that there are 6 million businesses registered in the United States: about 600,000 are formed each year and about 540,000 die. The difference, 60,000 successful businesses, represents 1% of the total number of employers. Odds are long against any new business succeeding: I believe that funding, talent, commitment, persistence, and focus are key elements that determine success.
Since joining the ranks of entrepreneurs three years ago, I’ve wondered about how to increase the 1% odds in my favor. On the one hand, hard work on a single idea is crucial: making the most of every opportunity and accomplishing as much as possible each day. On the other, I mitigate risk by spreading myself across several different opportunities, diversified roles, products, and geographies that make up a varied portfolio of self-investments.
AT, the new SF business, is an example of going broader rather than deeper. It’s made up of people that I know well, coming together 'around an idea that makes great “back-of’ the-envelope” economic sense. Everyone is good at what they do and respects what the others contribute. The early work is funded; the conversations are generative. It feels like a winner.
Nothing in my broad, early portfolio of five ventures takes a lot of my time or resources, so I can play my part in all of them within a day each week and wait see what develops. Then, when one hits, I’ve doubled down fast and hard to push that success ahead. Two ventures currently demand that level of effort, and both are responding wonderfully.
One day I want to model whether I’m reducing or increasing my overall risk with this strategy – it would be unfortunate if I am making more work and increasing my meltdown potential. It already makes for very full days (and weekends), but has the virtue of keeping focus on my most productive ventures.
I’ve also been able to claim salary as things ramp up, based on the contribution of prior sweat equity during the embryonic portfolio stage. Hopefully, the broad strategy also pays off with at least one large equity exit, sometime soon.
The United States has 1.6 million active servicepeople, 5.1 per thousand, suggesting that around 1% of families have sons and daughters in the military. Ours has no military tradition, so it’s been a learning experience since ‘Liam joined the Air Force three years ago. Karen and I are both proud of what he does as a surveillance specialist, yet worried about the risks he takes as an active combat participant.
I’m still reconciling the contradictory impulses, conversations with family and friends elicit a similar mix of concerned patriotism. Discussing it, there’s not the sense of a moral calling so much as a task that needs doing with reluctantly good reasons for doing it.
Still, we all are delighted that he is excelling in a job that he enjoys so much, and it was wonderful to see him before he goes.
Occupy Wall Street makes much of the struggle between the 99% and the 1%. I’m sympathetic to their cause: the Tea Party has been a discouraging mix of selfishness, short-sightedness, and intolerance, and I’ve longed for a counterweight. Near the Federal Reserve Bank in San Francisco, I found the local encampment (staked out by a large group of police), and stopped in to see what it was all about.
Unfortunately, this group was completely incoherent. More street fair than political statement, the signs railed against oil, government, money, the Fed, global trade, Wall Street, school cuts, banks, and the media. It made me realize how broad the problems are, how frustrated people get, but didn’t suggest that the opposition has found cohesion, direction, or goals. Right-wing talkers sneer at the protesters lack of unity and length of hair, and, from what I saw, they do make easy targets.
But there is underlying truth. I’ve been reading Jeffrey Sachs book, The Price of Civilization, and the issues are clear and well-understood (and nicely enumerated by the Financial Times in their review): Stagnant wages, diminished savings, rising inequality, and declining health and social program effectiveness, exacerbated by the pernicious view that “government is the problem”, mismanaged globalisation of labor, and the corrupting influence of big business and big money on politics and media. An accurate and coherent description of the problem could lead to constructive discussion of solutions.
But this is not the group that can carry that banner. A pity.