If Entrepreneurship Were a Sport
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I was at the Jersey Shore a couple of weeks ago, spending time with my family and enjoying slow, relaxed mornings. I would wake up at 8am and sip my cup of coffee while sitting on our balcony overlooking the water and the dunes. It was a spectacular week filled with cousins playing Spikeball and volleyball, barbecues, strolls down the boardwalk, and post-dinner trips for ice cream.
My nephews spent the afternoons with us, but their mornings were starkly different. They would wake at 5:30am and be in the car by 6:30, headed 1.5 hours toward their training ground in Philadelphia. You see, the two of them are professional soccer players who play for the Philadelphia Union, and they needed to get to practice.
I share this not to brag about my excellent uncle-ing skills. My sister and her husband were both remarkable soccer players. All four of their sons are destined to go pro. What matters here is the importance of practice. Athletes are expected to practice their sport, often from a very young age. Entrepreneurs, on the other hand, are not.
The problem with entrepreneurship today
As I sat on the deck one evening, watching the sun recede behind the bay and preparing for my next book project by reading through classics on strategy and entrepreneurship, it occurred to me that entrepreneurs, innovators, and business builders are forced to field the pitch as novices. They get no practice.
Without practice they arrive on the field inexperienced, having to decide each move on uninformed logic, without the benefit of knowing what works and what doesn’t, with an intuition entirely unprogrammed. The only time they get to try a technique is during the game. They have to figure it out as they go.
In sports, you hear of athletes practicing the small things every day. They know what the techniques are. They’ve seen matches being played. Insights have been captured in books and training manuals. Entrepreneurs don’t have this luxury. There is no science, only a mass of coaches who hawk different theories and approaches.
If a “game” is an attempt to build a business, even the most prolific entrepreneurs only get three or four chances. Imagine an athlete trying a game they’ve never played before, playing one or two times, and never getting to play again. This is, unfortunately, the state of entrepreneurship.
If entrepreneurship were a sport, it would be like watching your grandparents playing video games for the first time or preschool soccer games where one kid scores a goal for the other team. It would be like stepping onto the golf course with a baseball bat instead of a golf club; running the wrong way to third base instead of first in a baseball game; or jumping too early for a slam dunk, losing the basketball, and hitting your face on the rim. Entrepreneurs don’t get enough “at bats” to build the techniques to succeed. They don’t even know the rules of the game.
We need a field for entrepreneurship
To compensate, we need to start treating entrepreneurship like a sport – replicating the basics, recording what we’ve learned through trial and error, and making it acceptable, if not required, to ask for coaching. (Read more in our recent Outthinker Network article “Business Practitioners Need a Field”.)
I’m in the early stages of my next book, which I am co-authoring with Verne Harnish, bestselling author of Scaling Up and founder of Entrepreneurs’ Organization (EO). Verne has spent the past four decades helping companies scale. He’s seen the game played hundreds of times. I doubt there’s anyone in the world whose entrepreneurial intuition is as informed as his. We’ve boiled down the science of business building to a four-step framework:
Promise: Successful businesses are built on finding an unmet need (a “job to be done”) that is clear, underserved, and likely to grow over time. The right promise is like finding the sweet spot when the ball hits the bat.
Power: Pricing power is the ultimate key to driving valuation. Building pricing power allows you to command higher margins than your competition by establishing competitive advantages. Think about a cyclist drafting behind the leader for most of the race. It gives them a strategic advantage to conserve their power and burst ahead of the leader in the final minutes.
Process: Businesses that scale more rapidly engineer a lower customer acquisition cost than their competitors. They focus on the few KPIs/metrics that are most important for maintaining their unique advantages. What processes will you put in place to maintain your power? Consider a basketball team choosing a zone defense, or a man-to-man full-court press.
Profit: All businesses must manage a portfolio of opportunities that fall into five buckets: stop/abandon, imagine/explore, build, scale, and defend. Success depends on understanding where in the cycle (or the “S-curve”) you are. While many believe the time to sell a business is at the top of the S-curve, you maximize value when you exit in the steepest part of the curve. In sports, there might be a rebuilding season, like Steve Cohen restructuring the Mets this year.
Image source: ittybiz.com/s-curve
Our goal is to formalize an approach to scaling strategically. To help you avoid avoidable mistakes and equip you with core concepts and effective tools to develop your scaling strategy. We aim to make conscious what successful entrepreneurs have been doing intuitively.
A note: To accompany the book, we’re also starting a podcast to interview people who have successfully scaled businesses. Is there someone you recommend we speak to? Email info@outthinker.com.
Start your business-building playbook
To get started now, you’ll need to create your own version of “entrepreneurship practice,” even if you’re well into running a business. Find a way to replicate learning through trial. When you do, record the things you try, judge whether your trial was successful or unsuccessful (did you learn something to inform your next step?), and transfer that knowledge to the next trial, whether it’s yours or someone else’s.
It comes down to two steps:
Try a lot of new things: These attempts should be based on what has already been tried. To build an awareness of what’s been tried in the past, you need books, podcasts, and entrepreneurial networks like EO, Vistage, or YPO. Look outside of your industry for creative ideas and solutions. Sheena Iyengar’s book Think Bigger offers a six-step method for how to come up with your best ideas.
Record feedback on what worked and didn’t work: Collect feedback on the things you tried and convert that feedback into knowledge. The Experimentation Field Book by Jeanne Liedtka, Elizabeth Chen, Natalie Foley, and David Kester gives advice on how to execute high-quality experiments. Michael Schrage’s 5x5x5 experiment is another great resource.
By treating entrepreneurship as a sport and creating opportunities for practice and learning, we can dramatically improve the success rate of new ventures. With a structured approach to experimentation, feedback, and knowledge-sharing, business builders can develop the skills and intuition needed to navigate the challenges of building and scaling businesses.
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