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08/12/2013

Book Review: Worthless, Impossible and Stupid


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Worthless-impossible-stupid

Entrepreneurship has become an increasingly important option for financial professionals. Fortunately, there is now a lot more information on how to evaluate and succeed in this world. Most view today's entrepreneur as being in their 20s, operating in the technology industry. One of the values of Worthless, Impossible and Stupid: How Contrarian Entrepreneurs Create and Capture Extraordinary Value is it expands our view beyond the young and the tech focused. Author Daniel Isenberg is well qualified to be our guide into the broader view of the entrepreneur. He has been involved in business start-ups, was a Harvard Business School professor, and authored a host of case studies. Currently, Daniel Isenberg is the founding executive director of the Babson Entrepreneur Ecosystem Project, and an Adjunct Professor at Columbia Business School.

The book starts out with three myths. Myth #1 is "Entrepreneurs Must Be Innovators." Professor Isenberg's point is, "You just have to figure out something people need and find a way to do it better than anyway else." His example is Actavis, now the fifth largest generic pharmaceutical company, based in Iceland. This is a long way in distance and culture from Silicon Valley, which is the classic business start-up location. Another example is Cinemax, which introduced the multi-screen movie theatre to Mexico. This book is filled with examples from a broad array of industries and geographies.

Myth #2 is "Entrepreneurs Must Be Experts." Plainly stated, non-experts view the industry with "clear eyes," not clouded by a lot of traditional assumptions. One example is Clutch Group, founded by Abhi Shah, whose Indian parents were in the US on a temporary basis. Abhi Shah had no legal experience, but saw an opportunity in legal outsourcing and created a company to exploit this opportunity. While it is true that successful start-ups can be created by non-experts, those who finance them want to see prior industry experience and knowledge. It gives a lot more creditability to the project. However, Professor Isenberg notes that non-experts should not let themselves be stopped or inhibited by a lack of industry experience.

Myth #3 is "Entrepreneurs Must Be Young." For those of us no longer our 20s, or 30s, this is welcome news. Take Atsumasa Tochisako, for example. At the age of 52, he left a top job at Bank of Tokyo to create a money transfer software platform business. The book quotes a study by the Kaufman Foundation, that a growing part of new business entrepreneurs are in the 55–64 age group.

Aside from addressing the three common myths, a major point of the book is the importance of the contrarian approach—which means new ideas often look "Worthless, Impossible and Stupid." Professor Isenberg says, "aspiring to create and capture extraordinary value is something that many of us can do. But we have to be willing to go against the grain, to look for value where the majority of people do not see it, and to do something that may seem crazy until it is a success." The book has many case study examples that show this to be true. But there are also lots of successful new businesses that are created from going the next step in a growth industry like the Internet.

Professor Isenberg's book stresses the opportunities beyond the expected technology areas, and the usual age groups and locations. There are still a lot of start-up opportunities in these traditional formats, but as his book shows, we need to expand our horizons, mindset, and assumptions to all the other paths to success as entrepreneurs.

–Bill Hayes

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