Special Guest PostNew­ton Cam­pos, a good friend who lives in São Paulo, Brazil, is one of those rare peo­ple who is at home in both the busi­ness world and acad­eme. He’s exec­u­tive vice-direc­tor of the Pri­vate Equi­ty and Ven­ture Cap­i­tal Research Cen­ter at FGV-SP — and he’s a pro­fes­sor at both Fun­dação Getulio Var­gas (Brazil) and IE Busi­ness School here in Madrid, Spain.

New­ton (@phdnew) has more than 20 years of expe­ri­ence in busi­ness devel­op­ment for tech­nol­o­gy and edu­ca­tion­al ser­vices. Dur­ing those two decades, he has lived on four dif­fer­ent con­ti­nents and vis­it­ed more than 50 coun­tries for pro­fes­sion­al and aca­d­e­m­ic pur­pos­es. A true mas­ter of the sub­ject on entre­pre­neur­ship, he has devel­oped a spe­cial exper­tise on the role of obsta­cles and social net­works for entre­pre­neur­ial ven­tures in emerg­ing and under­de­vel­oped economies.

With the pub­li­ca­tion of his new book, The Myth of the Idea and the Upside­down Start­up: How Assump­tion-based Entre­pre­neur­ship has lost ground to Resource-based Entre­pre­neur­ship [link], I asked him if he could write a short post for The Nextsens­ing Project. He has a lot of wis­dom to share. Here’s a quick sample.

Pas­sion­ate, cre­ative, dis­rup­tive, per­sis­tent, admirable, authen­tic, inspired… 

The list at times feels infi­nite. In the begin­ning of the 21st cen­tu­ry, it seems there are too many words in the vocab­u­lary to describe an “entre­pre­neur”. Ever since I first start­ed observ­ing entre­pre­neur­ship in the 1980s, I have seen the entre­pre­neur­ship ‘move­ment’ emerge, spread and become glob­al­ly indis­pens­able. With hun­dreds, if not thou­sands of non-gov­ern­men­tal organ­i­sa­tions (NGOs), gov­ern­ments and busi­ness firms cur­rent­ly pro­mot­ing entre­pre­neur­ial activ­i­ties and ini­tia­tives as some­thing not only nec­es­sary but also “vital to human progress”, entre­pre­neur­ship has become some­thing almost religious.

Newton Campos

How­ev­er, the word entre­pre­neur­ship only became pop­u­lar after the 1990s. As a glob­al phe­nom­e­non, then, it is still some­thing rel­a­tive­ly new. As it hap­pens with most not total­ly com­pre­hend­ed phe­nom­e­na, unan­swered issues end up spread­ing in the form of myths — and, with entre­pre­neur­ship, the sit­u­a­tion is not dif­fer­ent. For exam­ple, there is a myth that entre­pre­neurs cre­ate jobs. That’s not nec­es­sar­i­ly true. Some­times they do cre­ate jobs, but some­times they also destroy a lot of jobs. Think about what Net­flix did to Block­buster, the movie rental store.

Anoth­er myth says that entre­pre­neurs are good for soci­ety. That’s not nec­es­sar­i­ly true either. Only respon­si­ble entre­pre­neurs are good for soci­ety. Imag­ine entre­pre­neurs who pol­lute the envi­ron­ment or cor­rupt gov­ern­ment authorities.

One of the main myths I like to address in my class­es is the “Myth of the Idea”. Most peo­ple think that entre­pre­neurs are very cre­ative peo­ple who start their ven­tures based on amaz­ing ideas. This can hap­pen, but it’s very uncom­mon. Many stud­ies in the field, includ­ing my own, show that most entre­pre­neurs don’t start with a great idea but with key net­worked resources. Good ideas emerge after­wards and aren’t as impor­tant as peo­ple imagine.

Instead of fol­low­ing the tra­di­tion­al start-up devel­op­ment for­mu­la in which the idea assumes a cen­tral role in the entire entre­pre­neur­ial process, research has shown that we should replace this ini­tial point of view with a new appre­ci­a­tion for the prop­er use of resources that are already avail­able to poten­tial entre­pre­neurs. That’s because access to resources invari­ably leads to bet­ter exe­cu­tion; and, from good exe­cu­tion, all sort of ideas can be prop­er­ly tested.

The impli­ca­tions of this re-read­ing of the entre­pre­neur­ial process are sig­nif­i­cant. At this exact moment, there are lit­er­al­ly thou­sands of start-up com­pe­ti­tions run­ning with­in com­pa­nies, trade fairs, schools, uni­ver­si­ties and gov­ern­ments around the world. And all of these seem to have a focus on the myth that entre­pre­neur­ship is trig­gered by some “great idea” that will inspire a win­ning ven­ture. This view of how entre­pre­neurs real­ly work is far too lim­it­ed in its reach.

Allow me to pro­pose a new way of defin­ing the entre­pre­neur­ial process. By putting coor­di­nat­ed or net­worked resources in the epi­cen­tre of the process, the idea moves to a more hum­ble sub­al­tern and sup­port­ive role with­in the entre­pre­neur­ial framework.

Do you want to start a venture?

If so, you no longer have to wait for some unique and amaz­ing idea to sud­den­ly spring to mind. There is no need for count­less ideation ses­sions, intense brain­storm­ing, design think­ing or oth­er con­cep­tu­al tools of inno­va­tion that con­fuse or decel­er­ate the begin­ning of the entre­pre­neur­ial process. Nor should you feel that you have to bring great ideas to an exist­ing entre­pre­neur­ial project that is lack­ing con­cep­tu­al thrust. Instead, I rec­om­mend a reverse or upside­down way to start and grow a ven­ture. As I argue in my book, exe­cu­tion is emerg­ing as the main source of entre­pre­neur­ial achieve­ment around the world.

Peo­ple are still allot­ting far more weight to the impor­tance of the great idea as the key to entre­pre­neur­ship. The entre­pre­neurs I’ve met and stud­ied show that there are many oth­er, bet­ter ways to move for­ward. The vast major­i­ty of peo­ple can explore their entre­pre­neur­ial poten­tial even with­out hav­ing a per­fect­ed sus­tain­able idea in mind for a ven­ture. In fact, those who stand the best chance to sus­tain a new ven­ture will invert the entire order of the tra­di­tion­al entre­pre­neur­ial process by simul­ta­ne­ous­ly dimin­ish­ing risks while aug­ment­ing the chances of a favor­able out­come. And best of all, this is not just a the­o­ret­i­cal pro­pos­al but a prac­ti­cal method for success.

Want to know more about New­ton’s work? Just click here. [link]

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