Entrepreneurship
Hello members and subscribers! It’s time for our seventh Moonshots Master episode, and we are tackling a huge topic: ENTREPRENEURSHIP.
To get us started we hear from some of the most well-known and highly regarded entrepreneurs and authors out there. Darren Hardy kicks us off with a breakdown of what it means to be an ‘Exception’ and how it takes guts to succeed. We then hear Steve Jobs’ entrepreneur story and how he battled against settling for less. Continuing our journey into inspiration Warren Buffet motivates us by stating how he ‘tap dances to work’.
Now we are inspired. It's time to learn the hard truths about being an entrepreneur, and who better to share wisdom than Elon Musk who had to contend with criticism from his heroes. Helping us understand the value of starting on day one with a single-minded framework we hear from Michael E Gerber who prepares us for scale with the story of Ray Kroc and McDonald’s. Helping us analyze and understand why some businesses fail and others don’t, we learn from Bill T. Gross and his study into the reason for success being timing and teams.
To help us grab the opportunities and learn from the documented mistakes made by others, we hear from three entrepreneurial authors. First up we hear from Moonshots royalty Simon Sinek who says to start with WHY to inspire action. Next, we hear from Tim Ferriss who gives us 5 tips for starting a kick-ass business. Closing out the show we have some very practical tips from Eric Ries on how to utilize a lean methodology to define - and release - a Minimum Viable Product.
TRANSCRIPT
Mike Parsons: [00:00:00] Hello, and welcome to the moonshots master series. It's episode seven. I'm your co-host Mike Parsons. And as always, I'm joined by the man with the plan, Mr. Matt Pearson Freeland. Good morning, mark.
Mark Pearson Freeland: Good morning, Mike. And what an exciting topic we've got in store for all of our members and subscribers to the moonshots master series today, it's a pretty big topic, but I think you and I can make a pretty darn good stab at it.
What do you think?
Mike Parsons: I think we'll make a great stab at it. And I think we run the risk of thinking that every master series that we make is enormous and huge, but that's the point to the master series. Yeah, that's
Mark Pearson Freeland: right. We're trying to create a comprehensive, deep dive into all of these different topics and different foundations of being the best version of yourself and Mike.
We're in episode seven, right now, we've done motivation. First principles, teamwork, habits, circle of influence [00:01:00] communication. And now we're digging into in episode seven, the topic of entrepreneurship, and as a seven episode pack these really are the essentials of not only being the best version of yourself, but going out and creating a product and a business and an individual value into the world.
Isn't it. It's a huge element that we're digging in.
Mike Parsons: It is it's massive. And we love entrepreneurship at the Michelle's podcast because I think we see it as a forum to challenge yourself. It's like a great scorecard. And inside of it, you have to do something that truly helps your customers. You have to create value in order to start a business, you have to capture the value if you want to be profitable.
And it, it really can be a very worthwhile, fulfilling activity, but it does come with a few challenges.
Mark Pearson Freeland: Yes. As we find [00:02:00] out in today's episode, it's not all rosy tinted glasses, is it? I think there's a huge benefit for being an entrepreneur going out, starting your own business, doing your own hours. But as we're going to find out in today's episode, Mike, there are going to be challenges, but the good news is.
There is such a wealth of fascinating, eloquent, experienced individuals out there that can help you and I, and all of our members and subscribers understand and learn from those challenges in order to try and be a little bit more successful. So I think as a starter pack, a comprehensive, deep dive into it, I think you and I, and our members of subscribers are going to be much more well-versed than perhaps we would have been without the experience of all these others who we can learn
Mike Parsons: from let's hope so.
And I think to set the scene for this master series on entrepreneurship, what we've tried to do is create a broad, [00:03:00] comprehensive, start a pack to the world of entrepreneurship. And what we mean by that is we really tried to touch upon the magic that is inside of entrepreneurship. And we're going to listen to people like Steve jobs and Warren buffet, and really find out.
Why entrepreneurship is such a worthwhile undertaking, but for all of that inspiration, we're also going to cover a lot from people like Elon Musk and Michael Lee Gerber, author of the E-Myth, where we're going to get into the hard yards, the challenges of entrepreneurship. And we'll definitely bring it home.
With some really powerful things that you can do practically. As you start your journey into entrepreneurship, we're going to listen to Simon Sinek and Tim Ferriss and the king of the lean startup, Eric Reese. But I think it's essential to say, mark, that is such a big topic. What we really wanted to make this show do is perform the role of a launchpad there.
[00:04:00] If you were starting something new, if you listened to this 90 minutes right now, you'll be able to start your entrepreneurial adventure in the right way. That's how we thought about it. Isn't exactly.
Mark Pearson Freeland: It's a jumping off point or an introduction. Perhaps you're going to hear some clips or some topics or some frameworks that maybe you've heard on our weekly moonshot show.
Maybe it's elements that you've learned about in the past or read in a book today is about consolidating a lot of that. Elements there's essential DNA pieces and creating exactly, as you say, mic a launch pad or a jumping off point to be inspired to understand some of those pitfalls, but also to learn some essential, practical tips that can then help you go out and go and learn and give a a good go at being an entrepreneur.
And it's pretty exciting world.
Mike Parsons: Isn't it, Mike? It totally is. And I tell you what also is exciting is the fact that we are making this podcast. We're making the master series just [00:05:00] for our members, just for our subscribers. So I think before we get into the first clip, let's tip the hat and acknowledge mark out.
Great members vibe, Patriot. Why don't you hit us with.
Mark Pearson Freeland: Drum roll. Please hear our Patreon members reporting for duty. Welcome Bob Niles, John Terry Brady and Nial, Sandy modular and Kennan DMR, Tom Byron, Mark Halena, Yanni of marsh and Connor, Rodrigo Yasmeen, spaceman, Daniella, Lisa said, and bond ger Mr. Bond. Welcome Shell's family. It is getting harder, Mike, every single time we record to do it in just a couple of breaths, but I hope everybody you've heard your names and thank you so much for joining us and being part of our Patrion family.
Mike Parsons: Fantastic. And I think it's time to start the inspiration. It's time to get a little fired up because entrepreneurship is [00:06:00] such a worthwhile undertaking. It won't be easy, but it has so much promise. It has so much opportunity. So if you've been thinking about studying something. It's time to listen to one of our favorites, Darren Hardy, he's going to talk about what it really takes to succeed.
And he's going to point out something that really matters that if you're going to be a successful entrepreneur, you really do need to be the XL. The exception. We admire them. We're inspired by them and long to be like them. The exception transform the ordinary into the extraordinary. Some have a way with.
Some with words and others away with people. But one thing is true of all of them. They leave a legacy. Our lives are brighter. We have purpose, we know peace. The acception makes success [00:07:00] look easy, even though they have fought battles faced opposition and at times failed. And maybe that's what makes them special.
The exception don't quit challenge ignites their passion. They are visionaries that leave behind gifts like knowledge, wisdom, and heart for others who would never dare drive. It takes guts to succeed, to dream big, to imagine the impossible and make it real, to sign up for the unknown to challenge the status quo to forever.
And the boundaries of our imagination to offer up your potential, to hone it, to share it with your family, your community, our world. It's amazing to think that all these people are just like you, all achievers are created equal. They all start out the same [00:08:00] as a child, right? Eyes full of wonder with big ideas in a world that would test their will.
All that separated them from everyone else was their commitment to persevere, push bold and continue to believe in their ideas in themselves. The potential for greatness lies within each of us, unleash yours, be the exception.
Mark Pearson Freeland: Darren Hardy, all three of the entrepreneur rollercoaster. My key starting us.
In this moonshots master episode on entrepreneurship with a bang, isn't it in
Mike Parsons: bang that was like a triple Kaboom. But I think what's really interesting about setting the scene for us and our members and subscribers here with Darren Hardy is that it takes guts. [00:09:00] Doesn't it? You've got to go out and realize that you can't quit.
Mark Pearson Freeland: You've got to put in the yards and at the end of the day, what separates those who maybe have wanted to do it, but they've never got round to it versus the ones who have gone out and done it. And maybe it's been successful is putting in the time and the work and the perseverance as Darren calls out to go and get it done.
Mike Parsons: It's like the courage to start and the courage then to stick with it when it really is tough. And that's why it's such an exceptional pursuit. It's not for everyone. In fact, it's not for most, I would go as far as saying, and we're going to hear some fabulous stories later in the show.
Steve jobs, Elon Musk. Oh my gosh. Did they face some challenges? And again, something we've talked about on the moonshots podcast is think about this. A teacher said of [00:10:00] Einstein that he didn't have much potential. Disney was told he didn't have imagination. Oprah was fired from television saying she wasn't a good fit for TV.
The queen of television was what she achieved. It's part of the journey with entrepreneurship and it's the exceptions that are resilient enough to get through all of that hardship. And for me, That is like a wonderful playground. It's a scorecard, it's a competition, which you can prove not to forget everyone else prove to yourself what you're made of.
I think that's what Darren Hardy is really setting us up for. You can be exceptional. Everyone's got the potential to do it. Can you have the courage to start and the resilience to keep going? I think that's what a great start to setting up both sides of entrepreneurship. That's right. As Darren, Hardy's calling out to be the exception, you're going to sign up [00:11:00] for the unknown.
Mark Pearson Freeland: So if that sounds like a good thing in your morning, you're consuming the moonshots master episode. Good news because we have lots of unknowns coming up that you should be aware of as well. I think as an introduction, that was a great clip from Mr. Darren Hardy.
Mike Parsons: Yes. And so if you are getting a bit fired up already with Darren Hardy, you can head to moonshot, stutter, where you will find the show notes for this episode of full and complete.
You will also notice that we have a Darren Hardy episode, so you can check that out. That's in the back catalog@moonshots.io. And remember, because this is a master series, you may want to just pause this and go and bookmark some things or make some notes. That's totally okay. We're not going anywhere, but remember, we're going to cover lots and lots of ideas.
So you might want to write things down, take some notes on your phone because there's just so many different tangents and [00:12:00] lines you can chase from all of this thinking that we've gathered together to really create this master class in entrepreneurship. Mark, now that everybody is a little warmed up, I think we can go to one of the greatest entrepreneurial stories in history.
Mark Pearson Freeland: Yeah, that's right. I think the next clip we're going to hear from is somebody who doesn't really need to be introduced with much of a background. We're going to hear from Steve jobs. And like you say, Mike, his entrepreneurial story is pretty well known, pretty well documented, but for those of our members who maybe haven't heard of it, it's a wonderful introduction to maybe some of the unknowns as Darren Hardy was just referencing in that earlier clip.
So let's hear from Steve jobs and perhaps his slightly unknown or maybe familiar entrepreneur's story and our heat, he chose not to say.
Mike Parsons: I found, what I love to do early in life was, and I started apple in my parents' garage when I was 20, we worked [00:13:00] hard and in 10 years, apple had grown from just the two of us in a garage, into a $2 billion company with over 4,000 employees.
We just released our finest creation, the Macintosh a year earlier, and I just turned 30 and then I got fired.
How can you get fired from a company you started? What had been the focus of my entire adult life was gone and it was devastating. I really didn't know what to do for a few months. I felt that I let the previous generation of entrepreneurs down.
I was a very public failure, and I even thought about running away from the. But something slowly began to Dawn on me. I still loved what I did.
We are going to make it or break it based on whether we can provide products to higher education and services and relationships to higher education that no one else provides. And I think we had to spend a hundred percent of our time thinking about that. And if we [00:14:00] can't do that, then we ought to go grow.
And so I decided to start over. I see it then, but it turned out that getting fired from apple was the best thing that could've ever happened to me. The heaviness of being successful was replaced by the lightness of being a beginner. Again, less sure about everything. It freed me to enter one of the most creative periods of my life.
During the next five years, I started a company named next, another company named Pixar and fell in love with an amazing woman who would become my wife. I'm pretty sure none of this would have happened. If I hadn't been fired from apple, it was awful tasting. But I guess the patient needed it. Sometimes life's going to hit you in the head with a brick, don't lose faith.
I'm convinced that the only thing that kept me going was that I loved what I did. You've got to find what you love, and that is as true for work as it is for your lovers. Your work is going to fill a large part of your life. And the only way to be truly satisfied is to [00:15:00] do what you believe is great work.
And the only way to do great work is to love what you do. If you haven't found it yet, keep looking and don't settle. So keep looking. Don't settle. Mike he's pushing us big time do what you believe is great. Work do work. That matters is something to my Riley. The publisher and author has also said, and I really believe this.
I think the reason this thinking from Steve jobs is so important about entrepreneurship is because he believed what he was doing mattered because it was great work. He was able to have the fortitude for not settling for a worse option. He chose to pursue stuff that mattered and he got the result.
He didn't just go for the easy, convenient path. He really [00:16:00] fought for what he believed was great work, work that really mattered. And I think sometimes we find ourselves compromising when the hardship comes. And I think what Steve is reminding us. As entrepreneurs is the don't settle. Find what you believe is the great work and stick the hell to it.
What do you think,
Mark Pearson Freeland: Mac? Yeah, I think that's exactly what he's calling out in that clip. I think he's also saying I chose to not run away from the valley. I chose to put up with that. I think he references a kind of public embarrassment. I think he even goes so far as to say public failure. I'd been fired from a company that I started that became 2 billion worth after the 10 years.
And I chose to not run away from it. Instead I say settled into the space. I saw that this new opportunity had come up and instead of him lacking the [00:17:00] confidence to go and explore it, he was able to. Hold his head up high and go into it. Knowing that he'd perhaps had that confidence from starting apple from a garage.
And what I really like about that clip is he doesn't back down this new opportunity with Pixar comes up and instead of him saying no, I got fired from my last place. I'm not worthy instead. He still gave it a go. So that confidence, that ability to see a new opportunity and put aside any sort of failure or distraction, I think shows some great mindset ability. I think another thing that he did in that clear is he revealed something that we all do perhaps never talk about is those little voices that say just quit, ran away. And he confessed that he was really considering leaving Silicon valley.[00:18:00] But he didn't.
Mike Parsons: He didn't take it. Didn't settle for plan B. He believed what he was doing was great working. He was able to get through that. And can you imagine how many of us as entrepreneurs every day, every week, every month when we're starting something that's bold and audacious and new in the world, and we're fighting for something that we believe in how often we will be tempted to say, I just walk away.
How about that? That voice comes,
Mark Pearson Freeland: doesn't it? Yeah, it certainly does. It'll get to a point where you think what is it really worth it? Is it worth the stress of those production costs or the contractors or legal issues, or just the ability to wake up and command a team or delegate work?
There's so many potential different challenges in just running a business, let alone being fired from it that I think an entrepreneur [00:19:00] would run into and wonder, wow, was this. Worth the hassle. And I think the mental resilience and patients that I think Steve jobs is referencing that clip him not leaving the valley would have led to him becoming part of Pixar, which as we all know is absolutely enormous.
And we all love the brand
Mike Parsons: great. Isn't that a great point that in losing, getting fired from his own company, he went on to create next and then he created Pixar and then next was acquired by apple and returned to apple. Like we wouldn't have had Pixar if he didn't get fired that crazy. It's an amazing story.
Mark Pearson Freeland: And it's one that maybe we've heard of, as we said prior to the clip, but actually when you do understand what took place, it's an incredible. Hero's journey, actually,
Mike Parsons: it is. It's very, it's a very good point. It is total hero's journey. And I just want to point out like when most of us [00:20:00] stuff up at work or if it's something like getting fired happens to us, it's I don't know, maybe 10, 20, a hundred people, 200 people know about it when it happened to Steve, the whole planet knew that he just got fired from his own company.
Can you imagine the emotions that would happen in addition to just getting fired from something you created, but then for basically everyone in the world? Yes. You just go buy it like, oh, that's like a one, two punch, right? Yeah. The knock to confidence ego. He did an amazing, it's an amazing example of not allowing your ego or your pride to start being able to do something it's act.
Mark Pearson Freeland: It is a really good example of not allowing your own little. To, or your monkey mind or whatever you want to call it [00:21:00] that your own worst enemy being stopping you, being able to go out and pursue other opportunities or start other businesses. And I think he, that his story is a great example of being that acception as Darren Hardy calls out in that first clip, we heard he is the exception.
He signed up for the unknown and he went on that row. Steve jobs specifically went on that rollercoaster and was able to come out and create not one, but a few different brands that are beloved around the world because he had the ability to stay at it. Someone who's stayed at it for a very long time, and who's definitely not in Silicon valley.
Mike Parsons: He's in Omaha, Nebraska is Mr. Warren buffet. And in fact, his approach to entrepreneurship is wonderful. So let's listen to Warren buffet talking about tap dancing. I don't regard what I do as the most important thing in the world will all, but it's right for me. I happen to be wired in a certain way that what I do works
I can certainly define happiness. Cause that's what I [00:22:00] am. I get to do what I like to do every single day of the year. I get to do it with people. I like, other than I tap dance to work at it, it doesn't diminish them. It's tremendous fun. Successes getting what you want and happiness, wanting what you get.
I don't know which one applies in this case, but I do know that I wouldn't be doing anything else. I do advise you when you have to work, go to work for an organization that you admire people admire because it'll a little turn you on.
To make money they didn't have, and didn't need, they risked what they did have and did me and that's foolish, but that is just buying fruition. If you risk something that is important to you, for something that is unimportant to you, it just does not make any sense. I don't care whether the odds are 101 that you succeed, or 1,001, those who see,
defining your circle of competence is the most important aspect of investing. Is that how important [00:23:00] our larger circle is? You don't have to be an expert on everything, but knowing where the perimeter of that circle of what you know, and what you don't know is, and staying inside of it is all important.
It's into behaving in a rational manner. It's not letting not getting in your own way. As I say, everybody here has the ability absolutely. To do anything I do and much beyond. And some of you will. And some of you, won't the ones that won't, if you, because you're getting your own way because the world wasn't a while to get to it, really, because you don't allow yourself to.
Mark Pearson Freeland: Warren buffet, what an example of an individual who's, you know how they say Hollywood royalty, Mike like a Clinton Warren buffet is his investor royalty.
Mike Parsons: Oh yes. He certainly is. And he dropped so much wisdom in that clip. It's a bit hard to know where to start. Where do you start?[00:24:00]
Mark Pearson Freeland: For me, I am inspired by his positivity around it. He's probably seen, of course he's seen a lot of success, but he's also seen, I imagine a lot of failure and a lot of challenges along the way, but what I really like that he calls out is the fact that you've got to stay true. To what gets you up in the morning?
Being happy. He says he tapped dancers to work, obviously metaphorically, but I think that's just a wonderful idea for somebody who wants to go out and be their own boss to be inspired and think I could tap dance to work. This sounds incredible. This sounds fun. But by, in order to do that, I think what Warren's really calling out is find a company, find a team, find a value that you can orientate yourself around that then gives you that confidence and that ability.
Be happy to tap dance, to work. And I think what he's really [00:25:00] calling out and what stands out to me is to not risk what is important to you. So whether that's finances or whether actually it's values, whether it's something that is, is a core element of your being, rather than risking that and sacrificing it and working for a team or a company or somebody that you don't necessarily respect and who you're not learning from, don't risk your time to go out and learn and be the best version of yourself by sacrificing it.
And what I think Warren's really calling out in that clip is saying, be true to yourself. Find people that you respect, orientate yourself around people that you can learn from, but also stick to what you know, and that's where he brings up this circle of competence. Which of course we can talk about what, what stood out to you, Mike, in that clip from.
Investor royalty Warren buffet.
Mike Parsons: Yeah. Some other things [00:26:00] that he mentioned in that quite that epic riff that we had from Warren is I think there was a really interesting thing about him focusing. He seems to be very focused on what can he do well, what does he, we enjoy doing? And then he sticks in side of that circle.
You know what I mean? He talked a lot about doing something that's right for you, your talent, your natural abilities. And he sticks in that and he could do it all day long and he's, it just comes naturally. Did you, I found that quite powerful about what he was talking about. What did you do.
Mark Pearson Freeland: Yeah I think this is a really interesting framework, which of course we've dug into on the moonshot show, as well as our Moss series.
The idea of the circle of competence. Haven't we, Mike, and I think it's a really interesting one for an entrepreneur who's considering either getting into a business, or maybe you're a couple of years in, and you're wondering [00:27:00] whether you're doing the best version of that company that you can, I think the circle of competence as he has more than buffered references in that clip is really how you can stand out.
What is the unique thing or the unique value proposition or the unique experience that you have as an individual versus what other people might know and what other people might be doing? Your circle of competence is something you can stay true to. And also. Similar to what you were referencing earlier, Mike, being able to test and understand whether or not you're staying true to the business in question, maybe something that you've created.
It's that competence, isn't it? Am I the best person who can be taking part or providing advice in this section? I think let's go a little bit deeper in here because if you're at the start of an entrepreneurial journey, I think it's important to know [00:28:00] what you do well and to reflect on what is my super power, my super ability and how can I organize my day to be doing that as much as possible, because I think what you hear it from Warren Buffett is he's designed it.
Mike Parsons: So he spends most of the day doing what he's really natural. Gifted in. So if
Mark Pearson Freeland: and any enjoys right
Mike Parsons: here. Yeah. But I think those two things go together. If it comes easy and you ex experienced like a flow state and you're like, oh, I guess this is what I'm built to do. So there's some interesting exercises and questions you can do here.
Now there's there was a big push five, 10 years ago about identifying your super power, said differently. Find out what is your natural talent. And I love this exercise of what's the one thing. You could be the best in the world. And this [00:29:00] is really interesting because if you can organize your entrepreneurial idea to maximize your time doing that things that come natural things that are just intuitive to you and that when you do them, you lose sense of time and place.
You're just immersed into it cause that's flow. So if you've got some flow happening, then you, and you can do that regularly. Like every day. Yeah. It's impossible to think you could do it eight hours a day, even just a few hours a day. Great. Things could happen. Here's a few things. Let's riff a little bit.
If mark you and I want to find out what is our superpower to make sure that we're following Warren's advice. I think it starts by saying. What do I find comes naturally? What does it w what do I think my greatest accomplishments are? And is there a pattern, is there a similarity in those things?
What else could you [00:30:00] think you can do if you want to try and identify your superpower and what your special ability is? What are your ideas on how you might? I
Mark Pearson Freeland: think as you just said this list of maybe what you do well can then lead on to understanding or looking at your proudest accomplishments.
So if you know that you're a great communicator with a team, a proud accomplishment could be voted the best place to work, or the most influential individual within the business. I think understanding your accomplishments as to what they are, but also why they're important to you is a great indicator as to what, whether it may have, maybe that's your superpower.
Mike Parsons: Yeah, I think it's really important to do that self analysis and you can go to 16 personalities.com. That's a great place to start. There's also, there's a great one [00:31:00] called what's your superpower.com and you take a quiz and it doesn't and analysis. I think the other thing too is what you could even go to the moonshots podcasts and say, which superstars entrepreneurs and authors have you enjoyed the most?
Who are you drawn to? Who are you fascinated in? Because to me, if you're really into. The science of what Elon Musk does, or if you're really drawn to let's say Michael Lee Gerber, maybe you really want to pursue something more closer to an entrepreneurial. Craft, maybe you want to be an author.
Maybe you want to be let's think about, we just did the health and diet series. If that was really appealing to you, maybe there's something calling you in the food health and wellness space, I think is really important. You can use the people that you're drawn to as [00:32:00] proxies for your own interests and where you will naturally find that your talents
Mark Pearson Freeland: exist.
I think that curiosity of looking at the individuals understanding what makes them tick is a great way to notice or identify what makes you get up in the morning. Doesn't it mind? Like you say, if you are trying to get into that health and wellness space, understanding what drives those other individuals and seeing whether there's a close match with yourself what a powerful way of identifying the strengths and maybe even weaknesses or experiences that they've had.
In order to learn from them, I think reflecting on those around you, whether they're individuals that maybe you haven't met, like these entrepreneurs, innovators, superstars, or even whether there are people that maybe you admire at work, maybe you admire on your door network or mentors that you've perhaps worked with.
I think they're a [00:33:00] great point of reflection as well. Aren't they looking back and thinking what did they do well and how might I be able to identify what I did. That may be been informed by what I've learned from them. That could be another great way of identifying a strength or a superpower in order to understand or unlock that flow as me cheeks and may high
Mike Parsons: taught us.
Yeah totally. And if you're looking for some inspiration for your flow state, just head over to moonshots dot AAO, because there's over 160 episodes, and one of those has a good chance of speaking to you. If you're looking for your special ability, your super power, that could be a great place to build on that advice from Warren Buffett.
Okay, so Michael, we've got the inspiration. What a package, huh? We've got the big entrepreneur author, Steve jobs and Warren buffet, but we're about to take quite a turn in the topic [00:34:00]
Mark Pearson Freeland: we are. As you could tell members and subscribers, there were lessons that we heard from Darren Hardy, from Steve jobs, Warren buffet.
Yes. It can be an amazing experience. There can be opportunities to tap dance to work, but let's be honest as Darren Hardy for emphasis is in his entrepreneurial rollercoaster book. And even the entrepreneurial story that Steve jobs gave us there are going to be a couple of challenges along the way. So it wouldn't be an episode and a comprehensive breakdown of entrepreneurship.
If we weren't going to share how you can understand and be prepared to experience challenging. Within the entrepreneurship space,
Mike Parsons: mark, I think we can just say it's the valley of darkness because it comes to entrepreneurs. So where do we want to start in the valley?
Mark Pearson Freeland: There's a fantastic story. Almost perhaps well known like the Steve jobs, entrepreneurship story, a clip [00:35:00] that we've, we visited on our own show that we've done on the weekly moonshot show from Mr.
Elan Musk and perhaps the most famous, or at least one of the most famous entrepreneurs out there, but he has not had a smooth ride and no I'm not necessarily referencing his experiences on Twitter. Instead I'm referencing an emotional story that he's perhaps been affected by in the past, but this is a great lesson for all of us entrepreneurs out there and how we can learn from an individual like Elon Musk and learn and understand that we shouldn't, we need to overcome.
Negativity critics, even when those critics might be your heroes. So let's hear from Elon Musk about critical.
Mike Parsons: People who've been in the rocketry business for decades who say about you, that you don't know what you don't know. I suppose that's true. If anyone, how can anyone know what they don't know?[00:36:00]
But when the critics say you can't do this, your answer to them is we've done it. There are American heroes who don't like this idea, Neil Armstrong gene Cernan have both testified against commercial space flight in the way that you're developing it. And I wonder what you think of that. I was very sad to see that because those guys are, yeah, no, those guys are heroes of mine.
So it's really tough. I wish they would come and visit and see the hardware that we're during camp. And then I think that would change their mind. They inspired you to do this, didn't they? Yes. And to see them casting stones in your direction.
It's difficult. Did you expect them to cheer you on? So they hoping they would. What are you trying to prove to them? What I'm trying to do is to make a significant difference in, [00:37:00] in space flight and help make space flight accessible to almost anyone. And I would hope for as much support in that direction as we, everything received.
Oh my gosh. Imagine we talked about Steve jobs being fired from his own company. Very publicly. Imagine if you're a well-known business leader and your childhood heroes are criticizing you in public about what you are doing that just, and you can hear it in his voice, in that clip. It really hurt Elan.
Mark Pearson Freeland: Didn't it? It actually sounded like he was. Reflecting on quite an emotional moment. And I think that's really revealing of the entrepreneur journey. Sometimes you're going to be in, in a moment where your behavior or your action, or maybe [00:38:00] even your vision is being questioned by those around you.
And sometimes those individuals may be there. Your role models, your mentors, maybe it's your family and friends. There are going to be moments when you really do have to question whether it's something that is worth doing based on the criticism of those around you. And I think what Elan's a great example of in that clip.
Is even though he was experiencing this criticism, perhaps this pushback, even these call-outs from these childhood heroes of his, he still had the ability to say this is what I'm trying to do. I don't think they, they get it. I don't know whether I'm putting myself across clearly enough because what I'm trying to do is for the betterment of people.
But I think what he really demonstrates quite nicely, there is again, that resilience or that fortitude to not crumble and say, oh you're right. If my childhood heroes are saying no to [00:39:00] it, I'm going to say, no, I'm going to close it down instead. He's still got that ability to say no, I'm still trying to figure it out.
I'm trying to get there. But yeah, it comes with a little bit of a challenge. Doesn't it? Even he experienced these pushbacks.
Mike Parsons: So I think the message here is we are. There's a stark reality to what entrepreneurship is really like. And we're often confronted with this kind of side hustle hype, right? And I earned a gazillion dollars on my side hustle and all this kind of crap, the truth is if you're doing something that's meaningful, if you're doing work that as Steve jobs would say, you believe is great work, there will be great challenge and Ilan he had buzz Aldrin criticizing him publicly.
He also, [00:40:00] he made a lot of money and there was one point where both space X and Tesla, when we're in real dire straits. And he had to write a check. For the last of his money. So he went and doubled down and all in on his ventures. So everything he made, he could have lost on that last check that he wrote, but he believed he was doing great work, Elon Musk, and therefore he was able to write that check and overcome his critics.
I think it is our job to remember that entrepreneurship will bring great hardship and that's okay. Just push through it one, because if you're not ready for it, you'll quit. But. I think we're confronted with all of these supposedly overnight successes, side hustle, successes, and it's just a load of crap.
Nothing good comes easy. If you're fighting for [00:41:00] something big, something that matters in the world, you're guaranteed to have some challenge. And I think Elan just presents that evidence so well.
Mark Pearson Freeland: Yeah. If there's one individual that I think we can all agree has worked hard. I'd say for me, at least I can see Elon Musk having put in the hard yards is an individual who has just tirelessly worked at trying to create these again, very well-known globally recognized household named brands.
And he's just been able to go add it and add it without fear of slowing down. He's still going. He's a great example. He was exactly who was landless.
Mike Parsons: Yeah. And I think this is a really good building block for us. I think the next one is there is a really big trap in the idea of starting something, starting a business.
And [00:42:00] you may be before starting it you're working for someone else and you have this dream of doing your own thing independence, freedom. And then you start the business in the wrong way and you become trapped in your own business. You've just swapped. Who's incarcerating you so to speak.
So there's some very good advice here. And it comes from Michael Lee Gerber. He's the author of the E-Myth and he makes this really interesting idea. And it's how we can think about scaling the business. So let's now have a listen to author, Michael E Gerber. Ray Kroc didn't start McDonald's until he was 52 years of age.
Ray Kroc went from 52 years of age without a pot to piss in
convince the [00:43:00] McDonald brothers to give him the franchise rights to McDonald's and they did. And he went back to this. Plan's Illinois borrowed the money to start his first store. But here this cause it's really critical to the story. Ray Kroc did not go to work in McDonald's. He didn't make hamburgers.
He didn't make French fries. He didn't make milkshakes. He didn't have an office in the store. He had an office down the street. It was the corporate headquarters of McDonald's that didn't make hamburgers there. They didn't make French fries there. They didn't make milkshakes. What did they make there?
They made [00:44:00] McDonald's. Please write that down. Ray Kroc went to work on the hamburger. Stand not in the hamburger. Stand to prepare it to scale. Please write that down. To prepare it to scale for sale. What does that mean? That means the company you own, the company you own today. How many of you own your own company?
Please raise your hands. The company you own today, hear me is your franchise prototype and our on for that franchise prototype to be replicated faithfully, you've got to prayer, prepare it to scale. That's the job of an entrepreneur.
Mark Pearson Freeland: The job one-on-one entrepreneur prepare to scale. I think what Mike Lee Gerber does a great job of breaking down for us in that clip.
[00:45:00] Mike, is this real perhaps a new idea, actually, for those entrepreneurs out there who perhaps have fallen naturally into working in their business, what Michael Liga was pointing out, is that one of the most successful businesses of all time? Nope. Donald's Ray crock franchisee went to the brothers, got the rights.
By not working in the business, flipping the burgers, bartering the bonds. He didn't do any of that. But what he focused on was his strength, his circle of competence, perhaps at building out the business, finding new opportunities and franchising it out. And I think this is a really big, very important distinction.
Isn't it for entrepreneurs out there because it's all too easy to get stuck in the weeds
Mike Parsons: doing every job. I think the definition here is the difference between a job and a business and what Michael Gerber is saying. [00:46:00] Be careful you don't just create. An independent job, rather create a scalable business by not just working in the business, but working on the business, reflecting, asking how you can make an operations manual.
What can you automate? What can you delegate? These are critical steps to take for scaling. And that's what we refer to as working on the business rather than working in the business. And it is such a powerful thought because I think a lot of this can quickly fall into the trap of just there's a huge to-do list.
I'm an entrepreneur hustle hustle. And then before it you're locked in trying to do four different jobs, getting one paid pack and working at 18 hours a day
Mark Pearson Freeland: rather than. Perhaps doing a pretty similar job for somebody else. I think a lot of people go out and start their business at the idea the rosy tinted spectacles, perhaps of being their own boss.
But what they perhaps [00:47:00] overlook is the fact that by leaving maybe a bigger company, You're losing the people who were doing the sales, the accountancy, the marketing, suddenly even let's say that you and I, Mike, we've got a great product or we're going to open it up tomorrow. We leave our businesses and we suddenly lose all of the resource that was around us.
Instead, we're now doing all of the different jobs exit, and you're then losing, as you say you're losing that flexibility to really focus on the core bit. That is all about the business. And instead of working on all the smaller stuff and something I've always struggled with is certainly delegation of time.
So it's something that you naturally, maybe as an entrepreneur gravitate towards, because you're very protected. Of the product protective of the business. So you don't necessarily want to delegate work, but that's such a [00:48:00] SAP of your time, isn't
Mike Parsons: it? It is. And it's a bit of the two sides is the paradox of being a founder is that you're really fired up about the vision and you've got all this energy, but then you make the mistake of trying to do everything yourself, because you've got all this energy and this vision.
And I think starting from day one really building systems that are repeatable, scalable that can be automated is a great way to start that journey to scaling the business. And in Michael's book, he talks about why McDonald's was one single restaurant and the guy that got the franchise rights, crock sat in a different office and he built the scaling machine to be the biggest. In the world in history, on the planet, because he worked on the business, not in the business, it's such a powerful lesson, isn't it?
Mark Pearson Freeland: [00:49:00] Yeah. And they feed 1% of the global population, which is a mind blowing statistic to me.
So Ray Kroc, just the rights and this is where they are now. I think it's a great example, an entrepreneur in this case, Ray crock, being able to have that long-term vision and being able to put in, as you say, those systems that Michael Lee Gerber breaks down in his great book (buy on Amazon), the, and it's a fascinating little story of seeing success.
Mike Parsons: Isn't it? I really is. So if you want to check out our show on Michael Lee Gerber, head over to moonshots.io and you can tune in right there, but now we're going to turn our minds to why some startups fail. Why some succeed from somebody that had his hand right in the middle, in the center of things, he was in the thick of the action.
His name is bill T [00:50:00] gross. He did a great talk on the reason for success in startups, and he has a lot of insights to share. So get ready. Let's tune in to find out why some businesses succeed and why some don't it's like I look across what factors accounted the most for company success and failure. So I looked at these five first, the idea, I used to think that the idea was everything.
I named my company Idealab and how much I worship the aha moment. When you first come up with the. But then over time, I came to think that maybe the team, the execution adaptability, that mattered even more than the idea, I never thought I'd be quoting boxer, Mike Tyson on the Ted stage. But he once said everybody has a plan until they get punched in the face.
And I think that's so true about business as well. So much about a team's execution is its ability to adapt, to getting punched in the face by the customer. The customer is the true reality, and that's why I became, I [00:51:00] came to think that the team, maybe it was the most important thing. Then I started looking at the business model.
Does the company have a very clear path generating customer revenues that started rising to the top in my thinking about maybe what mattered most for. Then I looked at the funding. Sometimes companies received intense amount of funding. Maybe that's the most important thing. And then of course the timing is the idea way too early on the world's not ready for it.
Is it early? Meaning you're an advanced and you have to educate the world. Is it just right? Or is it too late? And there's already too many competitors. So I tried to look very carefully at these five factors across many companies. And I looked across all a hundred ideal companies at a hundred non-ideal ad companies to try and come up with something scientific about it.
So first on these Idealab companies, the top five companies. City of search cars direct go to net zero. tickets.com. Those all became billion dollar successes and the five companies on the bottom, z.com, insider pages, my life, desktop factory people link. We all had high hopes for, but didn't succeed. So I tried to rank across all of [00:52:00] those attributes, how I felt those companies scored on each of those dimensions.
And then for not ideal companies, I looked at wild successes like Airbnb and Instagram and Uber and YouTube and LinkedIn, and some failures, web banner, cosmos, pets.com, flus and Friendster. The bottom companies had intense funding. They even had business models in some cases, but they didn't succeed. I tried to look at what factors actually counted the most for success and failure across all these companies.
And the results really surprised me. The number one thing was timing. Timing accounted for 42% of the difference between success and failure team and execution came in second. And the idea, the differentiability the idea that you knew this idea that actually came in third. Now this isn't absolute definitive.
It's not to say that the idea isn't important, but it very much surprised me that the idea wasn't the most important thing. Sometimes it mattered more when it was actually timed. The last two business model and funding made sense to me. Actually, I think business model makes sense to be that low because you can start out without a business model and [00:53:00] then add one later, if your customers are demanding, what you're creating and funding, I think as well, if you're underfunded at first, but you're gaining traction, especially in today's age, it's very easy to get intense funding.
So now let me give you some specific examples about each of these. So take a wild success like Airbnb. Everybody knows about well, that company was famously passed on by many smart investors because people thought, no, one's going to rent out a space in their home to a stranger. Of course, people prove that wrong, but one of the reasons it succeeded aside from a good business model, a good idea.
Great execution is the timing that company came out right during the height of the recession when people really needed extra money. And that may be help people overcome their objections to renting out their own home to a stranger, same thing with Uber. Uber came out incredible company, incredible business model, great execution too, but the timing was so perfect for their need to get drivers into the system.
Drivers were looking for extra money. It was very important.
Mark Pearson Freeland: This is a really interesting little breakdown. Isn't it? Mike, [00:54:00] from Mr. Bill T grass who spend time looking at all these businesses that he's been working on from Idealab and the three big reasons for success or the difference between success and failure.
Just to repeat their timing team followed by. The actual idea. And that's a bit of a, I think a bit of a surprise perhaps to some entrepreneurs
Mike Parsons: out there. I think what it's a reminder of is sometimes we become, can become so obsessed with our world and the product that we're building, that we forget to get it out in the world.
We forget that the world needs to be ready for it, or that we need the team to build it. And often perfecting the product is an excuse for not launching. And it's that constant? Sorry. Yeah. I'm going to launch it tomorrow or I'm going to launch it soon and then you see them a year later [00:55:00] still working on it.
We're going to launch real soon. I think what. If we zoom out, I think what gross really does here is shows us we're up against a lot of different things, right? It could be the business model. It could be the funding. And I think what was particularly powerful is that gross is like I created a company called idea lab, and I realized that in this study of all of the companies we were in and out of actually timing was the thing, not the idea.
And listen it's different for all. It's all individual businesses and why they may or may not fail. But I think the lesson to take here is that you do have several key success factors. Do you have cash? Do you have a good idea? Do you have a team to build it? Is there a way to capture the value in the business model and is the world ready for this or is it almost ready enough?
And what I thought was really [00:56:00] good. Mark is part of his work. Bilty grace also shared some key things that you can do to get it right. To overcome those challenges. And I think why don't we go through them read one age and we can jam a little bit on these. So he's first one, mark was surround yourself with people who know more than you.
Now that is some damn good advice, right? It's a classic one. Isn't it? An a, but I think it is one that perhaps founders and entrepreneurs do struggle with because after spending some time maybe experiencing a, maybe a more corporate world learning lessons from successes, they think that maybe they're the smartest people in the room,
but actually, oh, they just feel that as the founder, they are obligated to have all the.
Yes.
Mark Pearson Freeland: So they're the ones speaking the most and maybe failing to listen from those who have a very valid point of view. So surrounding yourself with people who [00:57:00] maybe know more than you, that feels like the step one. Doesn't it getting on the bus.
Mike Parsons: All right. What else has he got in the list?
Mark Pearson Freeland: The next one might is make the cash lost.
Maybe it sounds a little bit
Mike Parsons: obvious. I think a lot of companies go spend, and then they do the oh, we don't have an app. The big office, the too many hires instead of being able to stay lean in that market until the products really launched.
Yeah. And Paul Graham from Y Combinator, who we also have done a show on.
So head over dementia, start AAO for that. He's the founder of Y Combinator. He talks about. Surviving being success. And he's talking specifically there, if you can survive, if you can make the cash last that survival is success because in any market around the world, once you say, like within the first five years, [00:58:00] 90% of companies are dead.
So if you can make the casualized, you've just optimized your chances of success. All right. Number three immediately showed the door to the non a players. I think this is really, if someone is not a fit, do them and yourself a favor and say idea, see you later. I don't hold on to that. It doesn't work. It doesn't fit.
It's a terrible signal to the organization. What did they say? Hire slow and fire fast. I think that is a nice one. And I think, again, it's a great reminder of some of the experience as an entrepreneur maybe hasn't dealt with before. So just letting people go, it takes a lot of courage and.
Mark Pearson Freeland: Almost discipline to actually be true to yourself and your business and identify those individuals who aren't the right fit. Or maybe they're not good enough. Let's be honest. And then show them the door. Yeah. It takes courage. But if you're the boss, you're the [00:59:00] entrepreneur.
You've got to do it. So that the next one Mike is. Yeah, it's an extension of that. Really? Isn't it mean what you say and say what you mean? Yeah, entrepreneurs. You can get a little bit optimistic can't you? Let's just have a look at Elizabeth Holmes and thoroughness. She got in big trouble for not really being totally straight with us about her little famous blood tests and what they could do and the EDIS machine.
Mike Parsons: Yeah. Be straight. Be Frank, be direct. Don't beat around the Bush and just don't confuse things with misleading comments.
Mark Pearson Freeland: Yeah, I think it's very easy to there's an old adage say that you can ride the horse and then you can learn how to do it later or along those lines, rather than make all those big promises to new partners or customers in fact, [01:00:00] and not be able to deliver on them is a big no-no and a big way to lose authenticity and trust in the market, whether it's from your investors or from
Mike Parsons: customers.
Absolutely. Absolutely. Let's do one more age. There's plenty more. We'll have it in the show notes. These are the the lessons learned from bill T gross and how you can be successful as an entrepreneur. I'll do my last one, make decisions fast. And I like this one because I've witnessed it.
I've been a victim of doing it myself is sometimes when it's a tricky one. You don't just take some time to think about it. You defer it. And not making decisions can really start to cost the business. So I like that one make decisions fast. All right, mark. Round us out. What else is builty gross.
Got to teach us about being successful,
Mark Pearson Freeland: making a decision fast. I'm going to choose, give credit where [01:01:00] credit is due. So again, similar to being able to identify those that maybe aren't the, a players that you've got to get out. Also notice the ones that are a players. Don't forget about giving credit, where it's due, because it's going to be your business.
You want trust. You want individuals to love where they work. So being able to hand it out into the company, I think that's a great big reminder for us.
Mike Parsons: Certainly is so there, you've got it. This is really getting into the weeds of entrepreneurship. We've heard from Elon Musk, there's criticism coming, guaranteed.
Michael Gerber's like you got to work on the business, not just in the business, if you wanted it to go anywhere. And Bilty gross has given us a ton of ways to be successful, but don't forget team and timing are often crucial in the success of your new venture. All right, mark. That is part two of this master series into entrepreneurship.
Just [01:02:00] pausing for a second. How you feeling and what are you ready for next? I've been inspired by those fantastic individuals upfront. I now understand that it is not a rollercoaster. That's only going up. It's going to be one that comes back down as well. I think it's only right that we now go and explore how we might be able to learn practical tips as well as ways of adopting a potentially successful approach to business from the inside out.
Mark Pearson Freeland: So starting at the very beginning, maybe the core of the idea or the business all the way through to bringing out a product. I think this next part for us, Mike, to go and explore is really about how we might be able to adopt behaviors and tips and tricks in order to go out and be a successful entrepreneur.
Mike Parsons: I agree. And I would say that we have some real moonshot, favorite superstars coming up, right?
Mark Pearson Freeland: Yeah. We have the dinner party, the ideal moonshots dinner party in this part three and an [01:03:00] individual who has come up for us a lot in the past. And he maintains one of the top spots in our most ever listened to episodes on the weekly show.
Mike is Mr. Simon Sinek and his grit. He's got a number of frameworks, methodologies that you and I, as well as a lot of our listeners and members, I'm sure utilized day-to-day in the running of businesses and creating products. And this particular one is a fantastic way. Starting at the core essence of creating a new product or a new business, or even just understanding what it is that motivates you.
So let's hear from Mr. Simon's snacks and how we should really start with why
Mike Parsons: probably the world's simplest idea. I call it the golden circle. This little idea explains why some organizations and some leaders are able to inspire where others aren't. Every single person, every single organization on the planet knows what they do.
100% some know how they do it, [01:04:00] but very few people who organizations know why they do what they do by why. What's your purpose, what's your cause. What's your belief. And why should anyone care? The inspired leaders and the inspire or inspired organizations all think act and communicate from the inside.
Let me give you an example. If apple were like everyone else, a marketing message from them might sound like this. We make great computers. They're beautifully designed, simple to use, and user-friendly want to buy one. That's how most marketing is done. That's how most sales done. We say what we do. We say how we're different or how we better.
And we expect some sort of behavior, a purchase, a vote, something like that. Here's how apple actually communicates everything we do. We believe in challenging the status quo. We believe. And thinking differently. The way we challenge the status quo is by making our products beautifully designed, simple to use, and user-friendly want to buy one.
People don't buy what you do. People buy, why you do it. The goal is not to do [01:05:00] business with anybody, with everybody who needs, what you have. The goal is to do business with people who believe what you believe. Again, the goal is not just to sell people who need, what you have. The goal is to sell to people who believe what you believe.
If you hire people, just because they can do a job, they'll work for your money. But if you hire people who believe what you believe, they work for you with blood and sweat and tears, something called the law of diffusion of innovation. The first two and a half percent of our population are our innovators.
The next 13 and a half percent of our population are our early adopters. The next 34% are your early majority, your late majority, and your laggards that if you want mass market success or mass market acceptance of an idea, You cannot have it until you achieve this tipping point between 15 and 18% market penetration.
So it's this here, this little gap that you have to close because you see the early majority will not try something until someone else has tried it first. And [01:06:00] these guys, the innovators and the early adopters, they're more comfortable making those intuitive decisions that are driven by what they believe about the world and not just what product is available.
These are the people who stood on the line for six hours to buy an iPhone. When they first came out, leaders hold a position of power or authority, but those who lead inspire us. And it's those who start with why that have the ability to inspire those around them, or find others who inspire them. Thank you very.
Simon Sinek delivering in big time fashion starting with Y it's all about understanding that if you're just selling what you do, there's a million other people that can do. But what really shifts the needle, whether you're talking to customers or employees is your purpose. Why do you exist? And isn't it interesting.
This was also a theme in some of the earlier clips, this idea of purpose fighting [01:07:00] from work that you believe in work that is crate. If you actually start to look at this interconnected theme, it really is essential. I think if you're going to be resilient, but if you're going to attract customers and employees as an entrepreneur, there has to be a why there has to be some purpose.
There has to be a little bit of magic, something special in what you're trying to do, the problem that you're trying to solve with your new business. Otherwise you're lost in a sea of sameness. Don't
Mark Pearson Freeland: you think? Yeah. And I think too, to build on that, I think it's also a way of identifying or recognizing in your behavior.
Let's say you're an entrepreneur and you are you don't have a why or a reason for doing what you're doing. It creates a lot of additional hassle and confusion. I imagine, because you never know whether you're overstepping [01:08:00] your boundary of focus, your competence again much like Warren buffet was saying earlier and getting into an area that you don't necessarily know.
And in doing so you run the risk of either a wasting a lot of time. And therefore wasting a lot of money or you might even risk losing your customers. And by having something that is your north star, your reason for being your vision, your why that you can refer back to and use as a touchstone and identify what if I behave like this?
Is it at Hering to my vision, my core values, because if it is not, then maybe I need to either a relook at my values or B disregard the behavior entirely because I can't risk losing the business, the the reason why the customers, maybe the money or the time in order to, by pursuing something that ultimately doesn't align with the vision and the why [01:09:00] I think it's a great lesson and framework that any entrepreneur, in fact, every entrepreneur should go out and practice and do, and it's very easy to go and create.
And I think the benefit of it is that. Quite substantial because then you can utilize it from day one, onward, Strout the rest of the life of
Mike Parsons: the business. Totally agree. And once you've got your purpose, you can go out there and build an audience. And so now we turn our ears to another moonshot superstar, Mr.
Tim Ferris (The 4hour work week). And he's going to talk about quite a lot of different things involving, starting and building a business, but a crucial part of. If you've got purpose is you now need to build an audience. When you start a business, very common people want to stand out from the competition. I would suggest the easiest way to accomplish that is to not have any competition.
So to create a category, a new category of product that you own, [01:10:00] as opposed to trying to dominate an existing Amstel light imported life, beer, they own the category. Why? Because they fit it. You get a thousand diehard, true fans who love your product, pay for it in a relatively price insensitive. So you can always scale up.
If you try to aim for, as they would say, boiling nutrition, you're going to run out of money and your advertising, your marketing will be very imprecise. It will be designed subconsciously or consciously not to offend anyone. And as a result, you will have no diehard fans. I think that too many entrepreneurs focus on pricing in terms of being the low cost option.
And that is a race to the bottom. And if you are competing with any companies larger than yourself, you're going to get driven out of business if you're even remotely successful, because the other companies complete ships for longer than you can. They know that, and they'll just lower their prices. Model enough to drive you out.
It's a losing strategy. I think that there's a tendency to want to add things, to [01:11:00] do more, to fix problems. And the first step, the more effective step is to try to remove as much as possible. First, if you add people to an inefficient process, it's just going to make things worse. People will judge you based on say your storefront.
They will show. Your product quality, your professionalism, your reliability, based on that first impression, you can create that very inexpensively and very quickly by focusing on, for instance, something as simple as a logo, something as simple as a landing page, you don't have to have a landing page, 40 different clickable elements, but could you create a very attractive static image with a handful of things that are applicable because you've defined your most valuable click?
Yeah. You could do that and you can do it for next to nothing compared to how much
Mark Pearson Freeland: you could
Mike Parsons: waste trying to achieve that effect. Otherwise.
Mark Pearson Freeland: A lot of big tips from Mr. Tim Ferriss, Mike, you are totally right. That we just got a barrage of [01:12:00] good advice. Tim Ferriss, he's the man who has interviewed so many individuals, including business owners and entrepreneurs.
I feel as though each of those little tips has a wealth of background and essentially research behind them. Yeah. And I think the theme was to bootstrap early, right? He's like just go live. Get your first a hundred, your first thousand customers. And I think the other really important point that he focused on there was try to create a category, just something different because it's a race to the bottom.
Mike Parsons: If you're trying to go into an existing category with something that's just another me too product, which I think is a big danger for all entrepreneurs, they think that they're coming into the category with something that's wildly different, but in the eyes of the customer it's just the same, a widget and very good way to start because you lower the risk.
When you just focus on being really bootstrap and lean at the [01:13:00] beginning, just get your first hundred or your first thousand customers. That's much, much easier than trying to think about world domination. Yeah.
Mark Pearson Freeland: Yeah, and just get it out there, test and learn. I quite liked the other mistake that Ferris references there, where if you focus on being the cheapest alternative, you run the risk of those bigger players who maybe have more money and therefore an easier ability to keep on lowering their costs.
You're either a, you going to be regarded as the cheapest alternative, which to be honest, nobody necessarily wants to buy the cheapest product. Do they? Because the quality is in question, but you're also positioning yourself in a place where you can't then raise the costs because your customers, as well as your competitors are trying to match you and associate you with that price tag.
So I think that's a nice reminder [01:14:00] and maybe dose of cold water of Ferris is calling out as well. It's not necessarily just a case of either a entering a category where there's lots of other people and you think your products better, but really it's the same, but also matching that or pairing that with the truth where even if you bring in a product that's in an existing category, but it's much cheaper.
That's not going to be the way to success either.
Mike Parsons: Exactly. So some great. Make sure that you start with purpose and that you can answer the question why start lean and mean get in there and try and create something that's differentiated. Great advice from Simon Sinek and Tim Ferris, but we're going to round out today's show with the king of product himself, Mr.
Eric Harris, author of lean startup. It's a fabulous book. It's so worth your time to dig into. And we're going to hear from him about one of the key concepts that are within that is within lean startup. And that's the idea of a minimum viable product. [01:15:00] This is where you should build the most basic cut down version of your product idea to avoid ways to avoid risk.
And he's going to give us some real MVP wisdom. So let's listen to Eric Reese. Let me say a word about minimum viable product. I know. People will have heard of this phrase, at least a little bit. The idea here is we want to most startups are torn between these two different approaches to building product well, in which I call maximizing chance of success.
It says, look, we're only got one shot at this, so let's get it. That's what I talked about. Startup, number one, we're going to ship it when it's right. And that actually is perfectly rational. If you only have one shot and you want to take the best shot, you can build the most perfect product you can.
The issue is of course you can spend, I don't know, say five years of stealth, R and D building a product you'd think customers want and then discover to your chagrin that they don't. So the other possible extreme approach is to say let's just do release early release. Often people have heard that phrase and this just says, look, [01:16:00] we'll just throw whatever crap we have out there.
And then we'll hear what customers say and we'll do whatever they. But the issue there is, if you show a product to three customers, you get 30 opinions and now what do you do? So minimum viable product is a synthesis of those two possible extremes. We want to figure out what's the minimum set of features necessary to engage with those early evangelists to start the learning feedback loop going.
And so sometimes they get the best question. How do you know if you've found the minimum viable product and from a theoretical point of view, this is quite challenging. You could make a really interesting argument that any given feature is absolutely a hundred percent necessary to learn, but the good news is there's no reason to deal with this theoretical issue because if you're like me and every entrepreneur, I know what you think the minimum viable product is way too big.
Probably two orders of magnitude, too many features I'm not exaggerating. So the easy formula for finding out what the minimum viable product is take what you think it is right now. And cut it in half and do that two more times. And shipped back. And [01:17:00] I know customers are going to absolutely hate that thing.
That's only one eighth, as big as you thought it should be. And that's fine. If you ship that in customers say you moron, how could you have shipped without having features X, Y, and Z? The things that we're all going to be on your roadmap. Anyway, you can say good idea, good point. And then go build features X, Y, and Z.
But you may be surprised. Of course not you, but maybe a friend who would be surprised to ship a product as I did. And nobody cares. They don't say you idiot. It should have features X, Y, and Z. The worst fate of any shipping, any product is just, nobody cares. You don't get any feedback at all.
That's what most features on most products do. They're just dead weight. So we want to do is try to eliminate those and ship without them. Of course that's because visionary customers can fill in the. Early adopters can be very forgiving of missing features. They see the vision and you can be in dialogue with them going through that learning feedback loop.
Here are the kind of the reasons why people don't do the minimum viable product. I'm just trying to address some really quickly first the fear of the false negative. So [01:18:00] I shipped my minimum viable product. If it had just had that one extra feature, customers would have loved it, but because it didn't, of course they hated it.
Duh, why would I bother shipping something? I know customers will hate and there's nothing wrong with that reasoning. All I want you to do is ship anyway. So maybe customers will love it, even though it doesn't have feature X and then you can go on and be very successful. And if you're wrong and they really do need feature X, then you can just build feature X.
If you want to do minimum viable product, you have to be prepared to iterate. And so you have to have the courage to say, yeah, we'll ship something and get negative feedback
Mark Pearson Freeland: and response. This is such a huge benefit and learning and bit of advice, Mike, for anybody, any entrepreneur who's bringing out or considering bring out a product and you're looking at that roadmap, or you're looking at the time it's going to take to maybe develop or manufacture or even bring to life that, that idea.
And you're thinking, wow, there's a lot here. So you do, as we've heard about in the show so far [01:19:00] you delay the launch, you find a reason to push it to next year. But what Eric Reese is really saying is he's raising a flag or an alarm bell perhaps, and saying, just get it out there, get out an MVP, a minimum viable product and see what customers think.
Mike Parsons: Yeah, because I think it's so tempting to think if I just add another feature, it'll be more successful. But I love this idea that he's like the worst thing you could do is launch a. That nobody wants, which actually Eric did. And was the reason he wrote the book. He spent four or five years in a startup.
They raised many millions, tens of millions of dollars. Nobody wanted the product because they took years to get it live. He's get that thing live. And the quicker you can be confident that there's actually some demand for the product. The better don't hold off. Don't be scared. And he made the point early adopters they're quite [01:20:00] forgiving.
They don't expect it to be perfect. Exactly. And I quite like the story that Reese really calls out there, or the idea that he goes out there, if you put it into market and it let's say it's an eighth of the size of the product that you are. And you've put it out there and the customer says, Hey, Mike, you forgot to include a feedback forum.
Mark Pearson Freeland: And you're thinking as an entrepreneur. Yeah, of course. I knew I was going to put that in there. At least you validated it with the customers and you're now in a position to turn around and say, Hey customers, thank you so much for the idea. I'll get right on it. So the extension is not only, Hey, it's good because you can validate product features.
I think what it also provides you as an opportunity to include your customers in the kind of pre. Roadmapping the product life cycle in creating or recommending new features. And there's nothing more valuable, I think, than having a really [01:21:00] engaged community, much like our moonshot members and subscribers who get in touch with us.
I think there's nothing more valuable for a product and a set of entrepreneurs than hearing from the customers, what they like and what they don't like. And I think this is a perfect reason for maybe delaying or holding back on a couple of features in order to validate them with customers.
Mike Parsons: Yeah. And I think he has a lot of great work around the lean startup around value proposition, MVP, pivoting.
There's so much inside of the work of very crease. The reason we chose the MVP is I think that everyone is so tempted to build their first product way too big. And it takes too long. There's too many unknowns. There's too many guesses. He is. Giving us such a gift. He's saying I'm going to de-risk this for you and say, start small and iterate a lot and build momentum up, make a big thing, break it [01:22:00] into small pieces and start small.
It's such a beautiful, elegant idea because otherwise, if it's the first release you have got no idea what's going to happen. Sure. You might've done some early product discovery, but you still got to get a working MVP out there and that's when the test gets real. So don't make it too big, make it small, make it practical.
You can always add more, but be fast to market iterate a lot, learn a lot and avoid being the guy or the girl who's sitting there working on a, an idea for years and never launching it to the world. I think that's the key advice.
Mark Pearson Freeland: Yeah. Imagine being an entrepreneur that spent maybe a year, a couple of years, maybe longer, lots of money, lots of time, lots of energy, lots of blood, sweat, and tears, and you're taking your time and what happens, somebody else brings it out.
How [01:23:00] much would you be frustrated? Disappointed. Instead of being that last one to the post, just get it out there, start building that audience, start building the product and who knows where it might go. It might be the best thing you ever did. And I think what we've heard today, Mike is a pretty good breakdown of a number of the failures, as well as the opportunities that being an entrepreneur can really provide you.
Mike Parsons: Absolutely. Absolutely. I think we have gone from top to bottom, from left to we have really painted a picture of entrepreneurship in the most recent section of the show. It was all about those practices. Things that we have to consider building an audience and avoiding some of those pitfalls.
But more importantly, I think knowing that this journey into entrepreneurship is both inspiring and challenging all in the same breath. Wow. Mark, we've [01:24:00] done three big chapters. We've done nine experts. What is it that you're reflecting on now that we get to the end of the entrepreneurship class? It's such a huge introduction into entrepreneurship, isn't it?
Mark Pearson Freeland: You've had Steve jobs down, Hardy Warren buffet, or building us up. And I think the consistency that I can feel and that I'm learning from each of these superstars innovators and ultimately entrepreneurs is their ability at staying the course. Occasionally and like a big wave or maybe it's criticism, or maybe it's a product issue, or maybe it's just being busy and overwhelmed and not having the ability to focus on the business.
And instead of getting stuck in the business, I think it's the ability for each of these entrepreneurs to persevere and all of these individuals. [01:25:00] Whether it builds, he grows Michael Lee Berber Gerber it on mask. You've got these well-known household individuals, bestselling authors who have tried and tested all of these methods and experienced these mistakes themselves.
And I think what we can really learn after today's deep dive. Is really that it takes resilience to be an entrepreneur. Stay the course when things come up with distractions or issues, just stay the course, have that vision, that north star, that reason why as your ability to keep yourself going, but just remember that you're not in it alone because all of the greatest entrepreneurs that we've all heard of and read about, they've experienced those challenges themselves.
Mike Parsons: They have. And it's so good to know that when you're facing the challenges of entrepreneurship, Even Elon Musk [01:26:00] faces them as well. So you're not alone and you don't have to be alone. Surround yourself with great people. There's a ton in there. You're absolutely right. Stay the course. That's the big lesson.
All right, mark. Thank you to you. And thank you to you. All of our members who are subscribers to the moonshots master series, I've hope you've enjoyed episode seven on entrepreneurship, where we started the journey with Darren Hardy, where he told us it takes guts to be the exception. Steve jobs told us don't settle, dream big and do great things.
And Warren buffet said, Hey, if you can, you want to tap dance to work? And then we took a turn to the challenge. Elon Musk overcame his critics. Michael Lee Gerber said prepare for scale, work on the business, not in the business and build together. I am aware of all of those key factors, especially timing and team to entrepreneurial success.
And it wouldn't be a moonshots master series. If we didn't have our greats, [01:27:00] Tim Ferris, he said, get out there, build that audience. Simon Sinek said, make sure you have purpose, not only for your audience, but for your employees to an Eric. Reese gave us that timely advice of building an MVP. Don't spend years hiding your product from the world.
Get it out there quick, fast, iterate, and learn, do those things. And you will be on the path to entrepreneurship, do those things, and you will encounter the need to be great and to be resilient. And this is the place you can do it here at the moonshots master series, where we give you everything you need and the integrated model for being the best entrepreneur they choose can be okay.
That's it for the moonshots master series that's around.