The Entrepreneur Podcast
The Entrepreneur Podcast

Episode · 1 year ago

33. The Soul of an Entrepreneur with David Sax

ABOUT THIS EPISODE

The word ‘entrepreneur’ conjures a very specific image. Picture a white male from Stanford, or Harvard, who is bold, brash, and ready to change the world – and you're halfway there.

From the icons of the 1980s like Larry Ellison, Bill Gates and Steve Jobs, to today’s Elon Musk, Mark Zuckerberg and Jeff Bezos, to name a few, the legend of the entrepreneur has outgrown its former confines.

But are they reflective of the true face of entrepreneurship? Do they capture the wide variety of lifestyles and philosophies that lead people to start their own businesses?

Canadian journalist David Sax doesn’t think so.

In this episode, Sax shares the thesis of his latest book, The Soul of an Entrepreneur, which dissects the myth of the modern entrepreneur, and its impact on the accessibility of entrepreneurship.

Sax is the author of the best-seller, The Revenge of Analog, which was on Michiko Kakutani's Best Books of 2016 in the New York Times. His work has also appeared in New York Magazine, Vanity Fair, Bloomberg Business Week, The New York Times, Saveur, NPR, GQ and Toronto Life.

...thats new Siris of the Ivy entrepreneurpodcast. You're invited to listen in on the guest visits, my hustle and gritglass taking place virtually at the Ivey Business School. Hustling great is,of course, that we created to teach you everything that you didn't learn inbusiness school in business school. In it, we invite world class innovatorsand entrepreneurs to talk about topics like motivation, how toe learn, what toprioritize and even how to be happier. In these episodes, you'll hear liveaudio from my classes because, honestly, there's just something different aboutthe energy, excitement and honesty taking place in a live classroomenvironment. So get comfortable, grab a seat and don't worry. Unlike my realclass, I won't call value. Enjoy. David is a Canadian journalist. He was bornin Toronto. He's written for publications like New York Magazine,Vanity Fair, Bloomberg, The New York Times Geek in Toronto Life. He'sauthored several books, including The Revenge of Analog Taste Makers and Savethe Deli, which won a James Beard Award. His new book was the one that reallycaught my attention, however, the soul of the entrepreneur and typically whenyou think about startups do you think of, You know, people dropping out ofcollege, raising venture capital. But really, entrepreneurs come in allshapes, colors, backgrounds on sizes. And so, in David's new book he spokeabout he spoke with entrepreneurs all over the country, big and small, theseside hustles and full time gigs. And he dug into how entrepreneurship reallychanges lives. So, please, if you don't mind, give a nice warm welcome to MrDavid Sacks. David is still with us. There we go. I thought you were gonnamaybe Hi. Nice to meet you guys. Eric, good to see you. I didn't know I had towear a suit, but this is the most of a dressed up in, like, four months. Soyou don't. I appreciate that. You've got a shirt on today. You're welcome.And high there. Westerns. Westerners Hope you're not the ones who are goingback to the bars and parties. Sure. Yeah. You're the good one. To thebusiness students s. Oh, yeah. It's a pleasure is a pleasure to talk to you.I'm glad you started off where you started off, Eric, and it's interestingto hear what everybody thinks. So I'm interested to sort of get into it. Yeah,so I want to start with. I know your family has an interestingentrepreneurial backstory, So if you don't mind, maybe we'll start therebefore we jump into your book and what you learned. So where did your family'sexperience with entrepreneurship start? I mean, I think it's it comes down fromevery sort of generation of my family. You know, the oldest generation of myfamily. I know that's in Canada, like came in the teen fifties, and they weretobacco merchants and then in the clothing business, like many Jewishimmigrants, toe Montreal andan the tool business. And you know, there's veryfew members of my family that I can point to that have jobs and careers inemployment working for other people. Um, my father, since he graduated lawschool, basically just went and worked for himself and has always done that.My mother had a clothing wholesale business. My mother in law, same thing.She sold wholesale clothes like from card tables, even though she's one ofthe first females in Canada to get an MBA. And, you know, I've always workedfor myself, I think, since the day I graduated from McGill, I went out anddecided I wanted to be a journalist. I didn't tried to apply for some places.I couldn't find a job. So I was like, Well, I guess I was just freelance andright and write articles and write, write, write books And and so I thinkthat's typical of a lot of people who can look at their families and see thissort of through line of entrepreneurship. And yet, even thoughthere are people who have had great success within the family or withinfriends of mine, and have done very well for themselves in buildingbusinesses or careers where they are entrepreneurs around their own, there'sno there's no grand Titan that there's no names that you would know about.There's no Elon Musk in my family or or anyone sort of that equivalent.Nobody's nobody's named a business school after them, and I think that'strue for most entrepreneurs. You may know people who are successful. Yousure all know or related to someone who has their own business. It worksthemselves. But when you go and learn...

...about entrepreneurship at a businessschool, or you read a book about it. It doesn't tend to focus on the 99% ofentre runners out there who are people like myself or my wife or my father. Ormaybe some of you know, your family, relatives and friends who go on workthemselves and may have a business may not even have a formal business, butmight just be self employed like I am and do it for all sorts of differentreasons that are probably not something that you discuss in a class like this.So when we opened the class, we had a chance to get to know everybody andwanted to learn, like what People wanna learn about entrepreneurship and whythey took the class. And a handful of people mentioned sort of thesensationalized version of entrepreneurship that I think your booksort of tackles and that with that article tackles, you know, you you dropout of college, you start a mobile app and you raise a bunch of venturecapital money. Where did that start like? When did that? Actually, no, itwasn't that way forever. Where did that get started? You know, I think it'sit's always been there. I mean, the popular vision of entrepreneurship iskind of something that comes out of the industrial Revolution, right? You know,prior to that you had wealthy people who are merchants or, you know, wealthyindividuals. But, you know, you were in a system in Europe or it all dependenton whether you're working or not. And so the the industrial Revolutionhappens in the middle of the 19th century, and suddenly you have thesetechnological innovations that open up all sorts of businesses. And you havethese business people who become these global names Rockefeller, Carnegie, J.P. Morgan Thompson here in Canada whenever I know who was the king ofCanadian first. And, of course, that that grows with different eras. But itbecomes like that that individual becomes sort of a hero in their ownstory. They write books there. They themselves become these sort of popularcelebrities. You really see it growing in in the culture, starting with thecomputer age. And so, you know, in the 19 eighties you have Bill Gates. Youhave Steve jobs. You have others like Larry Ellison, who, because of thenature of the technology and the thes sort of exponential growth that itaffords are able to build these tremendously successful, powerful andinfluential businesses seemingly overnight. And they're not the sort ofbusiness heroes that you would read about that were sort of known peoplelike Lee Iacocca. You know, the great auto magnate from Chrysler, let's say,or Warren Buffett or something like that. It is, You know, there is this,that there's almost like a pop culture element to them. I mean, Steve Jobs hashad Mawr movies made about his life than Martin Luther King. I was at aretreat like a corporate retreat center outside Toronto a couple summers ago,and, you know, it's like a really like conference center, very whatever. Theyhave a lot of conferences and then a wall of heroes, and it was literallylike, Ah, picture of Mahatma Gandhi and a quote Mother Teresa to quote MartinLuther King Jr in a quote, you know, Barack Obama. And then it was likeSteve Jobs, Mark Zuckerberg, Peter Thiel like it. Suddenly, the idea of anentrepreneur was more than just. This person is successful in built abusiness. They were a moral force, a force of leadership, a character thatwas worthy of, ah, cultural interest. That was far more than just thebusiness in the invention they made. And that over the past 20 somethingyears has really accelerated tremendously with the Internetrevolution, the mobile revolution and the Revolution. And, you know, variousother digital technologies that we've seen so much so that has become thissort of package thing. So now when you talk about that myth of the startupentrepreneur, we have an idea in our...

...head of what that means. Oh, it's ayoung individual. They're probably probably male. They're probably white.And they probably went to Stanford or Harvard, right? One of those twoschools. Sorry. I mean, nobody's you don't have your hero yet, Andi. TheyThey're really bold in their brash and they say cool things and they probablydropped out and they say the health authority and they're gonna change theworld, right? We've all watch Silicon Valley on HBO. I mean it z this trope,but it's become that narrative that we've come to expect. We've been fed it,and so often what you see is people playing into it. The best example ofthat is Elizabeth Holmes. Everyone know who Elizabeth Holmes is now. ElizabethHolmes was a 19 year old Stanford University student about guess a decadeago who decided she wanted to reinvent the way blood testing was done. And youwould do it by pricking your finger and putting a drop instead of taking needleout of your arm. And she managed to build a company called Theranos bydropping out of Stanford and raising, uh, it was like, I don't know, UH, $70million with the venture capital money, maybe more. Maybe it was a couple $100million for the venture. Happened of money, massive investors, you know,huge people on her board. It was like basically, every former chief of staffof various presidents were on our board, and the whole thing was a sham. Therewas never any machine. The technology never work. Now she's being tried incourt, and actually, I think just claimed insanity the other day, part ofher defense. But what she sold the world was herself is a vision of anentrepreneur. Her dream was to become the next Steve Jobs. Someone said thatshe dressed in black turtlenecks that she ate the same diet is jobs that shetreated people like crap in the same way that Steve Jobs said, like youcould read the Steve Jobs biography by Walter Isaacson and you could followher career and it was this parallel thing and the staff said they did thesame thing. But she was so successful in raising all this money because sheknew that was what people expected of an entrepreneur. They didn't expect amiddle aged African American woman, for example, that wouldn't have flown, butshe fit into that into that type. And so So what you've seen is thatentrepreneurship has become well, it's still this broad thing of way, saidMicrophone, over anyone who goes out and works for themselves in the culture.It became so lionized and yet in that very narrow way that it excluded thevast majority of entrepreneurs by who they are by what their background is bythe industry. And most importantly, I think, by their motivation for being anentrepreneur, because no two entrepreneurs want to do the same thing,even if they're doing the same business. So we'll go back to that originalmetaphor. You talked about Eric, the pizza business, right? There are 100places to get a pizza. I'm sure in London. Uh, definitely here in Toronto,A place like New York. Whatever. Right? And yet each one of them has their ownthing. This one's gonna be the high end Neopolitan place with the 500 degree ofin this place is the chain that's gonna be the next pizza pizza, the nextDomino's. This is the just greasy 3 a.m. late night slice place that you'regoing to go after the bars let out and every owner behind them. They're notall trying to become that next Domino's or pizza pizza. They want to dosomething. Someone's might just be happy making the perfect pizza. Someonemight just do it because it's a way for them to have a business that they workfive days a week and it'll put their kids through college. Maybe there arecently arrived Canadian and they wanted something that they could getinto in order to make sure their kid could go thio ivy and get a businessscreen, go on and get a good job and banking or consulting whatever. All ofthose motivations air genuine. They're all entrepreneurs, but we only reallytalk about and teach that one example, which is like, Oh, you want to start apizza business? What's the most disruptive pizza business you could do?Here's how you can get all sorts of venture or private equity financing inorder to leverage that the most and...

...then innovate so you can be the biggestpizza chain in the shortest amount of time. But that model of pizzeria to usethe original Italian term might not be the one that you actually want mightnot be the one that speaks to you. Maybe you just want to sling theperfect pie, and that's okay. And I used to be a food writer back in theearly part of this career, and I interviewed tons of people who ownedCupcake bakery, sandwich shops, restaurants, pizza, places that used tobe management consultants, lawyers. They had MBAs, and it was like I wasdoing that and I got fed up with it, and I really just wanted to make theperfect pizza or open this type of pizzeria or whatever. And I did thisbecause this is what appealed to me, and that's the thing that I think wetend to forget about entrepreneurship. When we talk about it in an academiccontext, we see it as an economic activity. But fundamentally it is anemotional, personal active right. If you're going to go and leave thecertainty of a job and the salary and benefits that come with it and thecheck that comes every two weeks, it's not a rational economic decision.Most businesses failed. We know that most people who go to be entrepreneursare not successful in the way that they imagine. And yet they're driven to doit by something that is inherently true to that, which is this personalemotional motivation. And that differs for each entrepreneur. And so it is asdiverse is, you know, the faces in this class and the colors of the rainbow, soto speak. It was a very, very, very roundaboutanswer. You covered a lot of ground, and I like I like it on it, right? No,But if you were, you get a good grade. Um, so it sounds like you could take itto mean that it's sensationalizing it as a bad thing, but I'd say when I wasin the shoes of the students in this class. I took this class when it firststarted at Ivy. I had those same ambitions. I think I was drawn in bythe sensationalized version of entrepreneurship, and I think part ofthat is what drew me to it. And maybe I would not have been drawn to it if Iwasn't thinking that I could be the next Maybe not Steve Jobs. But you know,whomever, the Canadian version and the life that all of that affords. So is ita Is it a bad thing? Net net for entrepreneurship? Or even if peopledon't ultimately achieve it? Or is it a positive thing? And that is gettingmore people interested in entrepreneurship to begin with? It's agood question. I think it's a little bit of both. So the positive isentrepreneurship is cool. Entrepreneurship is interesting. Asmaybe Kyle said, You know, Gen Z is the most interested in entrepreneurship ofany generation. Kyle, I don't know if that was You are one of the heads toyour right. We'll get incredible. It was you had a boy. And so yeah, if ifyou know the lionization of Elon Musk or the wonderful puff pieces about thebrilliance of Tobias Luke, Um, or whatever. The latest genius to sort ofcreate something and be super successful gets more people motivatedin business and interested in starting their own thing and leads them toinstead of opting for graduating and going to work in McKinsey and beingmiserable, you're gonna be miserable if you go into consulting guys. Hot tip,but rich but miserable. You know, if they're like No, I'm going to startthat pizza place where I'm going to start that car parts business or I'mgoing to start that flower delivery app. Whatever the hell is calling you, thenthat's a positive thing. The downside of it and the danger is that when wereduce entrepreneurship down to that one model or that one archetype and weteach it in that way, and we finance in that way through what I assume is theIvy Business School incubator, which has probably a number of venturecapitalists on its board and has a pitch demo day in a startup, they andshow me your hockey stick and everybody...

...does their five minute pitch with thesame stupid you know, Power point presentation you're asking people topaint by numbers in a very small box, and you're you're actually limiting thepossibilities of what people concede as a potential opportunity in business.You're getting people toe to feed what they think that model wants, which islike Okay, well, it's gotta be a fast scaling business. I got to show themwhat they want, because that's what these funders like. It's like Dragon'sden, Um, or let's dragon's den, right Shark tank in the U S Like it. You know,you got to go up and you got to show the type of business that Kevin O.Leary wants. To hell with Kevin O. Leary. I mean, the reality is mostpeople that you go and talked about in the community, in the London community,in the Toronto community, auto, wherever you guys air from our fromparts further away, like they didn't build their business by writing up apitch deck and standing a bunch of in front of a bunch of wealthy investorsand saying, Here's how my idea is going to change the world. They just went outand built that business and did it for their own reasons and they succeeded orfailed based upon what happened in the cycle of that business. And the othermain problem with that is that that model of entrepreneurship which willcall the, you know, I call the Silicon Valley startup model, which is verymuch based upon that. Right. What's your idea? How you gonna present it?Give me your pitch deck. Where is the hockey stick? We're gonna inject inventure capital yada, yada, yada. It's exclusionary by its nature. 90. I wantcome someone guess what? Percentage of venture capital funding in the UnitedStates went to companies led by women? Uh, in 2000 and 18, which is the lastyear was available. Anybody wanna hazard a guess what percentage VCfunding in the U. S. Went to companies led by women. We'll take looking for answers. Maybein the chat. Let's see. Throw some answers in their 10%. 1% percent. 7%?Yeah, it was like to point 8% which was an all time high, So Congratulations,ladies. The glass ceiling has been shattered. You know, similar numbersfor for minority founders, black Latino founders. This was in the U. S. Youknow, you see a similar thing here in Canada. Most of the venture capitalfunding goes to people who graduated from Harvard or Stanford. It's like 40%.The vast majority of venture capital funding goes to companies that air inthe San Francisco Bay area and then New York City. Even Seattle, home toMicrosoft and Amazon gets like, I don't know, 3% of VC funding. So it is asystem that excludes the vast majority of people who are entrepreneurs. Andyou could say, Well, you know, the people who go to Stanford or geniusesand they deserve it. But that excludes a lot of you. I'm looking at here, andso the issue isn't that we've glorified entrepreneurship. It's a glorified,only one flavor of it. To use the Ben and Jerry's, we've we've glorified thethat I was gonna make up some stupid Ben and Jerry's name that would involvekeep going with us or something. But if anybody could think about Ben andJerry's name that involves Elon Musk or Zuckerberg or Steve Jobs, um, pleasetweeted in here, we'll take. We'll take votes in the chat or in this channel?Yeah, exactly exactly. Crushing it flakes or whatever. Anyway, I digress.Um, you know, if you're only promoting that one type of thing, it isturtleneck toffee. Bless you, Dalton. God bless you. That's jeans if you'reonly promoting one type of entrepreneurship. One. You're doing adisservice to all the people who might be excited about entrepreneurship butmay only see it in a narrow framework and may not see themselves in thatbecause they don't have the expertise or the knowledge, or it's again doesn'tspeak to them. And so we'll go and take that boring job at Deloitte and havetheir souls knocked out of them. And then, only later in life realized thatthis was the thing that they want to...

...dio but mawr importantly than that.What we're talking about are some of these fundamental issues that we'retalking about today, which is economic inequality and the inequality ofopportunity, right? One of the fastest growing groups of entrepreneurs arewomen of color in Canada, in the United States. Elsewhere in the western world,right black women, Latina women, brand women, indigenous women, they'restarting businesses at a faster rate and growing every year. And yet, ofcourse, they get a percentage of funding and percentage of, of course,is taught about them. The stuff doesn't reflect them because it's not that bigthing. And so, yeah, maybe they're starting a nail salon. Maybe they'restarting a small home catering business or a daycare business or somethingthat's going to appeal to that knowledge or skill set. But if you'renot promoting that, if that seems excluded, and those people are not onlyseeing themselves less like to be able to start something, but when theystarted less likely to get funding and support and education, then you'realready growing the gap of inequality that exists in the economy and in thissociety. And so we know that, you know, for immigrants, for new Canadians, forpeople of color, for example, group indigenous people, Canadians, thesewe're talking about groups that are are dealing with a systemic disadvantage.One of the things that has been shown thio over the long term shift. Thatdisadvantage is entrepreneurship, right? For many, I mean, who here is is comesfrom a family of immigrants, second generation or her third generation, right? Who here in that of thosefamilies of immigrants, have have family members who are entrepreneurs. Many pretty much one of those handsgoes up. Why? Because they're like, Oh, Mr Boyle, what did you do in India? Oh,I was an engineer. Okay, Well, sorry. You don't qualify for that anymore. Buthere you go. Here's, you know, good luck doing something. And so I imaginethat I'm just writing the narrative here that that family member decided toopen up their own business out of either unidentified A or a lack ofother option. They became an entrepreneur. And that allowed for thatintergenerational transfer wealth that you don't get when you work a Timmy's.And so if we don't focus and make it more accessible, that version ofentrepreneurship, which is the entrepreneurship that 99% of people aregonna be Maurin touch with than the founder of Cem Genius company, which isalways gonna happen. You're always gonna have your huge success is outthere in the world of business, wherever you are. Whatever thecircumstances, we're doing a disservice to entrepreneurship. We're actuallylessening it. And as much as you may wanna be one, it becomes lessaccessible. So can you paint a picture then? Yeah,No, this is This is good, because you're covering a lot of the questionsthat I had in one so we could go past 4. 30. Don't worry. So still, a handful ofpeople are thinking this is all well and good for everybody else. But, like,I'm different, you know, I'm gonna I'm still gonna go for it, which they hopethey are. I hope they are the one. But could you paint a little picture? Youdid your homework here. You traveled around? Uh, not just Canada, but the U.S. And maybe further than that. And you talk to a bunch of entrepreneurs who,despite the fact that they aren't the next Steve Jobs, have pretty darn goodlives and some of them to find that by making decent money, some of them tofind that by having a good lifestyle, the thinking about the Rockaway Beachstory. So could you maybe share some of the stories of entrepreneurs who,assuming that these people are gonna learn everything they need to know inthis class in order to be successful? Of course. But what are some of thenice stories that don't end up like Steve Jobs? but still end up prettyhappy. Yeah, Yeah, You mentioned Tracy. Tracy Belski is, you know, grew upoutside New York City in New Jersey. Um decided to become a pastry chef, Iguess in early twenties, after working in a bar, graduating from like, graphicdesign school, realizing she didn't want to do art and got to become areally well known pastry chef in some...

...high end New York restaurants where youknow, if you are a chef or a cook to be like, written up in The New York Timesand one of the top pastry chefs in New York City is, you know, you're in theyou're in the you're in the N B. A leagues of cooking. But, you know, thejob was a grind. She would work in basement kitchens without windows fromearly morning to late in the night, you know, working for male chefs who wouldtreat her like crap for very little pay. And, of course, you know the male chefs,we get promoted ahead of her and and you know, she was burning out like manypeople do. And many businesses, especially that one. And she also movedout to a place of New York City called Rockaway Beach, which is actually likeyou could take the subway to it. And it's a beach community on the edge ofNew York Queens Kind of work. JFK Airport is. And you could go surfingthere. I used to go surfing there, and she got into surfing. She was doing itwith another friend of hers who was also a chef, the restaurant and movedout there and was like, You know what? To hell with this. Like, I'm gonna Ijust wanna live out here. I want to serve. I want to enjoy my life, Wannawork? But I'm done working with these restaurants, you know, I'm done withthat. This is not the dream that I thought it was gonna be. And shestarted by baking croissants and pastries in like a broken down shackand a fishing marina. And, you know, she was dealing with toxic waste andall these fumes and the oven wasn't working. But like every morning, shewould, you know, sit there and roll Quest, Santo, looking at the sunriseover the bay and smoke a joint, and she's like, This is great, you know,borrowed a bunch of money, you know, took loans from the bank, opened up alittle bakery coffee shop called the Rockaway Beach Bakery and basicallyopened up. And and that's what she does, like Every morning she wakes up, shetakes a bomb hit. She actually is. I have not seen a bonk since I was inuniversity, but this is a grown woman. Takes bomb, hits something to learn.There she goes out, puts on her wet suit, walks like 500 ft into the ocean,go surfing for an hour, you know, watches the sunrise, takes a shower,takes her bike or skateboard along the boardwalk. Looking at the dolphins,jumping opens up her bakery, works her ass off like rolling dough, makingcoffee, making pastries for eight straight hours where she barely hastime to, like, take a break to go pee cells. All that stuff talks to people,is sort of the center of this community, you know, closes up, cleans up, prepsthe stuff the next day, takes the bike back, Another bomb hit surf dinner,hanging out with friends. Goes to bed early. Repeat that six days a week, youknow, with like maybe a week off a year, right? So she works really hard. Shemakes money, but she doesn't make tons of money. She's not making exponentialgrowth. She's not trying to franchise this thing. She wants it to be alifestyle business. The business was designed to be a lifestyle business,and if you speak to a venture capitalist or anyone in sort of theworld of private equity, something a lifestyle business is a four letterword that is the least desirable thing because you can't extract greaterprofit out of it. It exists in this sort of sustainable state for the owner.But if you're that owner, a lifestyle business is great because it affordsyou the thing that everybody wants and is very hard to buy. When you'reworking your butt off at a job at a law firm or or any sort of business. That'ssort of seeking that exponential growth, which is that lifestyle. It's time withyour family. It's time with your friends. It's time to do the thingslike surf that you want to dio, you know, read the biography villain Muskread a biography of Steve Jobs and Beyond the Greatness and the genius orthe stories of two guys who turn through marriages, abandoned theirChildren, never took a vacation, never decided to sort of enjoy the things inlife. And they're held geniuses, rightly so for their inventions andtheir ideas and whatever. But like, you know, you have to question at a certainpoint what life is, and I think a lot of people like, Oh, I'm gonna, you know,sleep when I'm dead or I'll enjoy my...

...life when I make that billion dollars.But that's not how the roller coaster ride works and not to plug plug yourwife too much. But I felt like the when my wife and I were on that path. We gotto know each other because your wife helps people with that transition. Ithink we were on a a path where we were not gonna say, growing apart. We had apretty solid foundation in our relationship. But when you're bothtravel, you have two kids and you're both traveling a quarter million milesa year. You sort of high five on Friday night, you know, catch up on sleep andthen you're on the air at the airport again. on Sunday. We hit that momentwhere it was like For what? You know, like what? What are we doing here?We're gonna be one of those statistics where you give up everything in orderfor what? A newer car that no one cares about. Like no one cares about.Legitimately So. And you're I mean, there's a whole industry now of peoplewho help you through that transition of like that crisis of I thought I wouldwanted this thing, but I ended up not wanting this thing. So this class isabout trying to teach people the skills that they need to be entrepreneurs orto think entrepreneurially. You had some anecdotes in the book about thingsthat you learned from your father with respect, entrepreneurship. What are thethings that we should be teaching or can be teaching? Young entrepreneursare hopeful entrepreneurs. So I think we we get back to that definition,right, And I'm not sure what article you shared with with the class that Iwrote, but all that happened, like the initial Covad fog. So it was just likestealing five minutes away from my Children toe write articles in the NewYork times wouldn't recommend doing that again. But here we are. We talkedabout that Schumpeter definition of an entrepreneur. Schumpeter. JosephSchumpeter was not the man who coined the term entrepreneur. He wasn't thefirst one to write about it in that sense, either, right? He came around.He wrote that in 19 47 I think, like two years before he died. You know, theterm is a French term, and it used to meet all sorts of things. Ah, militarycommander, Somebody lead in orchestra. I mean, it kind of goes back. But inabout 17 30 there's this French Irish economist, Richard Continent in Paris,and he writes a book which actually gets published like 20 years after Hedies. It's a series of essays on the economy. It's one of the sort of firstbooks about modern economics, and in it there is a chapter on the entrepreneurand he says, You know the entrepreneur. There are two types of people in theworld there, those who work for someone else for a fixed wage. You're gonna bepaid $1000 a week or whatever, and there's those who work for themselvesand all the rest are entrepreneurs from the beggar in the street and the farmerwho takes their pumpkins to market to the wealthy merchant who send shipsacross oceans and hand sort of grows these empires. And I think that, youknow that is still true today, I think. And what is the thing that links all ofthem together? What is the thing that links the person who might have a sidebusiness or side hustle in their dorm room with Western selling logo caps? Or,I don't know, used to be wheat, but I guess not whatever, like selling someservice or some sort of thing. But does anyone here have a small business thatthey dio? I'm going to use you as the example. No masks. Anybody in the maskmaking business can't get to mute quick enough for put up their hand. But thereare a handful for sure. Okay, yeah, so whatever your business is, right,whatever that thing is to your your tighten the business to the guys thatShopify or you know, whoever owns that, that sort of big thing, the posterchild of entrepreneurship and the only thing that links them together. It'snot money. It's not. Growth rates is not funding. It's not Childrenscreaming the background. It is two things. It is freedom and risk. Everyentrepreneur has an except that duality of forces into their life when theybecome an entrepreneur and they live with it throughout the course of theirlife is an entrepreneur. The freedom is the freedom to determine your work,what you wanna work in, how you wanna...

...build that work and and why it'simportant to you and how you structure your life and your work around eachother, right? And so for someone like my wife, Lauren, who is a career coach.And that's how Erica and owner and I interviewed for a podcast and myself,you know who is a essentially a freelance writer and speaker andjournalists like we have structure life around that idea of lifestyle we wantto spend as much time with their kids is possible, and we probably leastsacrifice money to do that. But this past summer, for example, you know,after dealing with fighting with the kids and juggling school, home schooland and whatever in this pandemic, I was like, I'm not gonna work thissummer I'm going to do nothing but, like, just be with the kids becausethere's no other option. And that was the freedom that I had. So that freedomon the others and this factory could be I'm gonna be the person that builds thebillion dollar thing, and nothing is going to stand in my way. I'm gonna put100% of my time to it, and I don't care what happens. I'm going to be theperson that chooses my freedom to get back to my community. I'm going to doit in order to live up to a certain set of values, whether their environmentalvalues of religious values or social values or whatever it is, it is thefreedom to define your work in the way that Onley you can. And the only way todo that with complete control is by working for yourself because you can'tgo and work in the Kinsey and say, Oh, but by the way, I want to define mywork in this way. And I like to see that thing. It's a door, Yeah, butalong with that freedom, which is the intoxicating, wonderful part ofentrepreneurship that everybody keeps everybody up at night thinking aboutthese wonderful things that could happen. The great success that couldhave the difference that could have what their life could be like, if onlythey were to do. This comes risk, and they're inseparable. The risk, the risk.First of all, yes, financial risk. If I don't work and don't succeed, I willnot have this roof over my head. I took the summer off of work. I made $0because nobody was paying me anything because I decided not to work. Therewas no check coming in. I didn't take servant and take the Justin bucksprobably should have. And so you know there's always that risk, the risk thatthe business could fail. And of course, now, during the pandemic, you go out inyour community, whether it's London or you're in Toronto, and you look at allthe stores and restaurants and gyms that have closed down and hopefullyseeing the strip clubs. And you know that behind that boarded up window is afamily and a life and hopes and dreams and investments and debt, and thatleads to the other part of the risk, which is more than just money. It isthat personal thing, right, because as an entrepreneur you tie your personalidentity and your life in with your business. It's your idea. It's yourcapital. Tell you, identify yourself. I am David Sacks, the writer. Here's myname on books. This is all I kind of have. I am so intricately tied to thatthat when the inevitable ups and downs of the business cycle happened, I amtort along with that, personally, in a way that I can't blame on the bossesupstairs or the market or Susan. An accounting screwed up the thing orwhatever. It's all on me. And that's the other thing that keeps you up atnight. Is that worry not just about your financial performance, but aboutthe very essence of your identity. And so while most courses and books and andarticles about entrepreneurship will focus on the business strategy andsales and marketing and all this sort of technical aspects that you need inorder to become and grow and succeed is an entrepreneur and all of those airextremely important. Whatever Eric's teaching here, listen to please, one ofthe things you actually really need to start thinking about. If this issomething that you genuinely want to pursue, is that relationship betweenthe freedom and risk and how you're...

...going to deal with that? What is thefreedom that you actually want? What is your reason for being an entrepreneurbesides just making money? Or maybe that's entirely it. And what is therisk that you're willing to entail to do that? And how are you going to dealwith that? Because it is not going to be just this great. I wanna be abillionaire and I'm willing to take the risk if I lose the money or whatever,it's gonna be a much more complicated thing. And this is the thing that oftenseparates the entrepreneurs who are successful in the long term from thosewho aren't is that they're able to deal with the emotional consequences of it.They're able to navigate the you know, they're able to endure the rollercoaster ride, the ups and downs and the twists and turns and all the nauseatingstuff in the middle, because that's what it is. Yeah, yeah, so I thinkthere's a t least I thought I would be the exception. You know, like no Aiken.Balance it all. I'll have the perfect family life and I'll be in good shapeand I'll eat well and I'll be a great dad and I'll keep cooking my own meals.Yeah, I'll volunteer. And all those things, uh, do the reality is a t leastfor me the after kid number two, it just all sort of. I was, like, somehowkeeping it together, and then it all just sort of fell apart. You're notsupposed to tell that to the 20 year olds, Eric. Well, I think reading ityet. Well, I think it ultimately kid screwed up. Here is the lesson fromthis or everything up? No, but it's a there. There are forcing functionbecause it made me think about what we're actually was important. And Iended up coming back to teach full time. And I feel like, truly, this is whereI'm This is where I wanna be in some capacity for the rest of my life. Socool. So the balance between freedom and risk. I like that we're a littlebit over time, but I know you've got some flexibility. It sounds like whichis awesome black hole. We won't spend too much time, but I've got a bunch ofquestions not in that chat, but privately to me and students had achance to up vote them. So there's one that got up voted the most, and it'sfrom Azman. Do you wanna? So the original question was your view thatthe vast majority of VCs are don't realize that all of these biases airbaked into their investment philosophy like the question was like, Do they notrealize that those biases air baked in? And why do they continue to focus onthis sort of model? Given that the majority of companies and foundersdon't fit that narrative, that's a really good question. I think there's arealization that it is an issue, like other issues like systemic racism, youknow, in various other parts of the society. But it works for them. So, youknow, we've elevated the venture capitalist to this exalted place asthis kind of gatekeeper of entrepreneurship, and that's happenedthrough the success of companies like Facebook and the popularity of you know,well known VC investors like Peter Thiel, who is a truly evil individual,and you know Mark Andresen and others here in Canada, for example, you knowwho are constantly written about and profiled and and asked to sit on panelsand whatnot on DWI baked it into these models of demo days and incubators andaccelerators and whatnot. But we have to remember that venture capital islike a very small percentage of the world of investing, even inentrepreneurship, right? Most entrepreneurs, most people, startingbusinesses, even successful, huge businesses that you know about Canadiantire Lululemon. You know, pizza, pizza, whatever. Like they don't go to venturecapital. They don't seek venture capital. They don't need venturecapital. Venture capital doesn't fit. The venture capital is for a veryparticular type of business. And yet we've expanded it in our popularimagination to be part of something, something bigger and something grander.And I think you know, to your to your question like, Why do they not sort ofseek that? It's like they're seeking the thing that fits into their model.They're seeking the peg that's going to fit into the hole that that they have,which is like we want a company that we...

...could invest X amount of dollars in.It's gonna do you know, 10 to 100 X in in under 10 years so we can deliverthis return to our investors that, you know, you know, 10% minus are 2% and 20carrier or whatever that fits into that model. But that doesn't suit mostbusinesses. That doesn't suit most entrepreneurs. And when you focus somuch on that, you're actually missing a ton of economic opportunity off all thebusinesses that don't necessarily fit into that. But could be huge, wildlysuccessful businesses that, if you invest in in a different way, couldactually provide a great return. And so there are, ah, growing cohort ofalternative investors, alternative investment funds. Even in the world ofkind of venture and technology, they're saying, Hey, this model of the way theventure capital has been structured and the incentives that it has in the andthe problems that it generates by virtue of what it demands is broken.And they're trying to build new alternatives that that are gonna allowfor, let's say, more sustainable growth or for a company and say, Look, we wantyou to grow this company, we want you to have profits. We want you to growsustainably. We don't want you to just have it and exit in five years. That isactually against what we want, and we could see a greater value in that. Butwe become so obsessed with that one thing that we measure so much againstthat. Yeah, that's good. So another one here that's got up voted the most. Sodo you see a problem with the way business planning is taught atuniversities? So how best can you balance the importance of good analysis?So, for example, in our one of our projects, you know, write a businessplan and how big is the market and who are the customers and all of thosethings? Eso How do you balance good analysis with just, you know, paralysisby analysis? It sounds like a lot of the entrepreneurs you intervieweddidn't write business plans. They just said, I want to do this. Let's go Saudibalance those two. Yeah, I think it, you know, again, it's remembering thisthings inherently personal, and there's no right answer to it. I think that'sthe thing, right. Like coming up with a plan is good looking at. Okay. How muchis this going to cost? Like, let me do a little bit of research into this tosee if it's sort of a viable thing is a smart exercise and these air tools thatyou can use, but I think where it gets dangerous or almost anti productive islike Okay, So as long as I tick off these 10 boxes, then it's gonna be agood, successful business. And I think that's where that sort of businessplaying competitions or the pitch deck demo day thing twists a little bit ofthat around. It's like, Okay, you said hockey stick growth check. Okay, youhave this cool graphic check like you promised to change the world check. Youhave ukulele music in behind your kickstart video check. All these thingsare good. Yours is gonna be the successful business. And oh, you sayyou're gonna start a company that you know cells, craft, cider. I don't know.Do we need more cider? It's like, Oh, well, that one ends up being successful.At the end of the day. It's a tool, but you know, when you ultimately take thatjump into business, one is like your plan changes on that day one because itmeets the reality of the market and two is like it's again, It's not, you know,becoming our career and starting a business is not an entirely economicthing. It is a personal thing you're putting yourself into that your desires,your taste, your history is your biases, all of that. None of that fits intobusiness plan. But a lot of those things are going to be what makes thatbusiness what it is. And so I think you have to remember that, right? Likeyou're remembering that it is that risk. It's that personal freedom aspect of itthat is gonna make that business yours. It's gonna make that business its ownthing. And and some of that might be contradictory Toe What should go intobusiness plan? Some of that might make...

...no economic sense On the face of it, itmight actually be the thing that that does well, Ben and Jerry's you know,they didn't get investors. It was too random. Hippy stoner dudes in Vermontwho are like, Oh, let's like, let's do you know, let's make like, the funkyflavors and we're gonna drive around this, Calvin. You know, it's gonna be,you know, it's gonna be organic, and nobody even knew what that was backthen. And, you know, we're gonna put these funny, like things on it. We'lllet anybody come to our factory, and, you know, they went to investors. I'msure people like guys. This is the stupidest idea, you know? What do youwhat do you to bang heads like thinking about? And yet, you know, that's whatit was. That's what gave it the essence of what it is versus, you know, someonewho is trying to copy hugging us or Baskin Robbins, for example. So, youknow, the business plan is a tool and a very valuable one that you you need topay attention to. But it is not. It is not the key. It is. It is a startingpoint, okay. And the last one here that I think still is one of the higheruploaded ones. So you mentioned about this sort of wall of heroes with thesegreat entrepreneurs sitting next to the people who change the world indifferent ways. On the question was, Do you think that with that great powercomes great responsibility where entrepreneurs are now going to be heldto this sort of higher standard where they, you know, sort of new definition.It's not just innovation and disruption. It's actually gonna be measured againstsocial justice and activism and all those sort of things. Sort of. The notjust for profit businesses is that is our narrative of what makes the heroentrepreneur changing. Who is that? Uncle Owen that said that fromSpiderman, Great power comes great responsibility. Um, Uncle Owen? Yeah, Ithink that possibly I mean, look, Peter Thiel, Mark Zuckerberg, you know, theymight be your hero if those your values if you're a libertarian and you believethat the thing that an entrepreneur stands for is what you read in theFountainhead. And you know, it's all about just innovating and creatinggrowing the economy and like that is the thing. And there are others who,like Ben and Jerry, believe that it means something greater Or, you know,even Chouinard from Patagonia. Or you know, any other numbers ofentrepreneurs that believe it's It's something great house. That's wherethat that personal aspect comes from, I think, and that's where that diversityof voices and faces and entrepreneurship is something that'simportant because we typically, you know, it's like there's this, like,tack on of values and ethics. It's like, Oh, we're a company And for every shirtwe sell, you were gonna give another one to charity And you know, that'swhat we dio that's like the good thing that we dio and you're like, Okay, cooltick. You've ticked off the the corporate social responsibility box,and that's what gets your articles written about or whatever. But like,there's another aspect of it is the company that makes sure it's and theydon't give them away. But they actually have created a more cooperative systemof the way they treat and pay their employees, and they don't brag about it.But it's actually something that keeps more people in that community and keepsmore jobs and gives them a better wage. And, you know, is sort of that quieterthing. Every entrepreneur brings their own personal values, toe what they dio,regardless of what those values are and that shapes that business. But I thinkthere's definitely a corrective that we're seeing now, especially in theworld of tech I mean, you know, if I asked you guys 10 years ago, I'd beclass. Who would see Mark Zuckerberg is a hero? There's probably a lot of handsgoing up. I mean, does anyone see Mark Zuckerberg is a hero today? No, He's like a pitiable, despicableOsaka book. Uh, um uh, you know, a moral figure who? It's like, you know,he was asked questions the other day about something in our interview andlike So, how did you feel about this genocide that happened specificallybecause of what you did? And he's like, Well, we just try Thio, keep every leteveryone have conversations. Um, you...

...know, that does not seem like the typeof person that belongs next to Martin Luther King on a wall in a conferencecenter in King City, Ont. Area. Okay, well, David, we could go on forsome time, and I got a bunch of questions here, but I've kept you 15minutes past when I promised I'd have you out of here. So I really appreciateyou coming in and sharing a little bit about what you learned in class andyour expertise. It's been good to reconnect. You're welcome. to stickaround, but I know you've got other obligations. So please, uh, get out ofhere. But we really appreciate it. Thank you. You've been listening to theIvy Entrepreneur podcast to ensure that you never miss an episode, subscribe tothe show in your favorite podcast player or visit ivy dot c a forwardslash entrepreneurship. Thank you so much for listening until next time.

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