Confessions of a Serial Entrepreneur
April / May 2008
Volume 6 Number 2
It was the best of times, it was the worst of times.
That's the first sentence in Charles Dickens's classic A Tale of Two Cities. It sums up my experience starting and growing companies. The highs and lows encountered in my entrepreneurial life have run the gamut of human emotions; they have ranged from truly exhilarating to nearly debilitating.
I am reminded of the opening scene for the old television show "Wide World of Sports" that depicted the "thrill of victory"—€”with a scene that I cannot recall—€”and the "agony of defeat" with a ski jumper tumbling off the end of the jump like a rag doll. That skier, I am certain, recovered from the fall and moved on to reach other achievements in his life, just as entrepreneurs often have to take a setback that seems devastating and move on. How many times have I been turned down by venture capitalists? 40? 50? I don't know anymore, but I have learned from those rejections and moved on, smarter and stronger (in my mind, anyway) from those experiences.
Like many entrepreneurs, I began my professional life in large companies with all of the accompanying structure, benefits, and supposed security, but ultimately found that the challenges and risks of creating companies were more alluring. The emotional rewards are also greater, in my view, with a startup.
So what led me down the path of leaving the "security" of a large corporation and attracted me to startups? Smarter people than me have studied this, and they should be consulted for an objective answer. I can only say that the frustration of feeling held back in the big companies played a big role, along with my desire to have more control over my own destiny.
I remember going into a meeting of the board of directors of Texas Instruments to present the case for additional investment in building a solar photovoltaic business based on novel technology that TI had developed. Accompanying me was the president of the division. As we waited to enter the room, his sage advice to me was simply, "Don't say anything stupid." Gosh, he really saved me with that sage wisdom!
It seems mentoring was not a strong skill of his, and thriving in such an environment was not a strong skill of mine.
I fell into my first startup when a strategic investor asked (and funded) me to find a way for him to enter the solar business. I found a manufacturing company in France that had some investors interested in selling their stake. That led to the acquisition of that company and me moving to France to run the company—€”clearly a challenge since I spoke no French at the time.
I left that company after several years when the strategic investor changed strategy and no longer wanted to support that company's growth, thus proving the fallacy of "controlling my own destiny" in a company funded by outside investors! I then founded a pure startup and entered the venture capital world as a clear novice. I learned as I went, succeeded in going through four rounds of funding, and though that company is not yet on solid footing, I feel rewarded by the accomplishments.
There is little advice I can give to someone considering the entrepreneurial path, though there are plenty of books on the topic out there that purport to be helpful. The one piece of guidance that I can offer is to follow your passion.
That passion is the foundation you can fall back on when rejected by a venture capital firm, or by a customer, or by a key employee leaving, or one of the gazillion events that can befall the leaders of a startup company. With that passion, you can push through obstacles and create a contagious enthusiasm that leads to momentum within the organization; that momentum then helps get past further obstacles, and thus the cycle of success begins!
There is one book that I highly recommend for anyone involved in any business, though I feel that it has particular relevance to a young company struggling for survival. This book is not in the business section of bookstores, and it does not deal with financial statements or how to develop customers or any one of the many tasks a company leader must master; rather, it goes to the core of start-up risks. It offers lessons for survival by studying the stories of people who have survived airplane crashes, being lost in the wilderness, the Bataan Death March, and other such real-life situations. Deep Survival, by Laurence Gonzales, will help you succeed as an entrepreneur.
How? By delving into some of the key lessons learned by real-life survivors.
In order to survive any difficult situation the book offers some important lessons, two of which I want to highlight. The first is that you must recognize the reality of a situation and accept that reality. The second key insight is that you must believe that anything is possible. The author offers many examples of people who survived terrible, unbelievable predicaments because they intuitively followed these two insights. The remarkable power of human beings to deal with adversity is perhaps best illustrated by the story of the author's own father.
His father was an air force pilot in World War II, and was so passionate about flying and defending his country that he was made squadron leader. On a bombing run over Dusseldorf he was shot down. His plane broke in two and he was unable to get out of the plane or even pull a parachute; he was in a free fall from 27,000 feet. After crashing to the ground, he awoke lying in a farmer's field still somewhat strapped into his seat, but with broken arms, broken legs, broken ribs, internal injuries, and his nose hanging sideways on his face dangling by a layer of skin.
Though in incredible pain, he was ecstatic that he had not been crushed to bits! In his mind he celebrated his good luck, and he remembers thinking what a beautiful sky he saw above him. As he was marveling at his good fortune, the farmer walked up to the pilot and pointed a pistol at him. Rather than curse the situation, the pilot could only laugh at the turn of events. The farmer was so infuriated at being laughed at that he put the pistol up to the pilot's head and pulled the trigger, but luckily for the pilot the gun misfired.
At that moment, the farmer's neighbor came to the scene. Though the neighbor was a rather frail elderly woman, her authority over the farmer was clearly evident. She folded the pilot's nose back into the proper position and had the farmer take the broken pilot into her home where she cared for him for several days. It was a remarkable turn of events that seemed, to the pilot, to signal the end of the ordeal.
Unfortunately, the enemy army came. They took the pilot from the woman's home and transported him many miles over rough dirt roads to a prison camp. It is hard to imagine the pain he endured as his broken body was hauled on those roads. At the camp, the only medical attention came from a fellow prisoner who had some medical training. Though the pilot's broken bones healed somewhat, he began to gradually wither away from lack of proper care and nutrition.
Finally, after many months and losing almost half his body weight, he was rescued by friendly forces, given proper medical attention, and ultimately brought home.
The ups and downs of this pilot's experience are very much like building a business. There are glorious moments and there are moments when the problems seem insurmountable, but by accepting the challenges of the situation and dealing with them, the problems can be solved and the company moves forward, just as the pilot's life did.
So follow your passion and believe that anything is possible.
As Dickens closed A Tale of Two Cities, perhaps one day you as an entrepreneur can say, "It is a far, far better thing that I do, than I have ever done; it is a far, far better rest that I go to than I have ever known."
The Schmit Dossier
Rusty Schmit recently resigned from the board of directors of Advent Solar, a solar cell and module manufacturer in Albuquerque that he founded in 2002. He had previously served as Advent's president and chief executive officer.
Advent's photovoltaic technology, developed at Sandia National Laboratories, is expected to cut the cost of solar-generated electricity in half.
A graduate of Arizona State University with a B.S. in mechanical engineering, Schmit worked in the photovoltaic divisions of Motorola and Texas Instruments before starting Matrix Solar Technologies with a private investor. Matrix acquired Photowatt International, a French manufacturer of wafers, solar cells and modules. Schmit was Photowatt's CEO from 1996 to 2001.
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