[Advice] Entrepreneurs Disrupted

We are at the end of about a ten to fifteen-year cycle of entrepreneurship being sexy. And now is a good time for disruption.

This is evidenced by current exits, acquisitions, and even the folding of companies. And while some VC dollars are drying up a little bit in traditional geographic locations, other dollars are moving to non-traditional geographic locations.

Like Pittsburgh.

Or Cleveland.

In those places though, where the culture of Silicon Valley (“fail fast, fail hard”) has yet to completely penetrate, two distinct phenomena are going to bump up against each other over the next few years. And this friction will occur even as breathless articles—and blog posts—will be written about the death of entrepreneurship in the major media, political, and social centers of the United States.

The first phenomena will be the mismatch between a traditional VCs perception of what the culture of investment should be, and the perception of culture in places geographically, (and culturally as well as ideologically) removed from that culture of investment. There have been a few businesses built like this in the Midwest (Basecamp, formerly 37 Signals, comes to mind) but there will be more friction in the coming years.

The second phenomena will be the mismatch between a “small business” mentality, and a “entrepreneurs” mentality. This will manifest in all kinds of ways, including work ethic, employee education level, and other localized influences. Many of these are unquestioned and “in the air” in Silicon Valley, and the mismatch is already acute outside of Silicon Valley.

Both of these mismatches can be overcome, managed, or eliminated completely through the effects of numerous, gossamer like transactions, but they all represent disruption.

That is, disruption for both the end of entrepreneurship being “sexy”, and the beginning of something else, even greater taking root in unexpected places.

[Opinion] Values as a Service

Even in a high tech, money saturated, hard charging culture, values, just like symbols, still matter.

Think of values in terms of the following metaphor: If values were the cloud, the story that we tell ourselves and others through our behaviors, language choices, and other means, would be the apps in the cloud.

The Ellen Pao case, the issues in Indiana, the arguments and disagreements over healthcare, how the government should spend money (guns vs. butter) and even the arguments and disagreements in your organization, all come down to values.

Culture comes about when people come together to form a community and abide with each other. Those people typically agree—either tacitly or openly—on the shared values their culture will demonstrate to the wider world. And what values will be reinforced with each other. If culture eats strategy for breakfast, then what does the Ellen Pao verdict say about the culture of the American judicial system, the culture of litigation in this country, and the culture of Silicon Valley VC’s?

Well, we here at HSCT believe that the verdict says three things:

  • The culture of Silicon Valley is functioning exactly as it was meant to. Which means that it is going to have to fundamentally be broken and reshaped to mirror where the business culture of America is going: Silicon Valley VC culture is not alone here. All over America this is happening, in corporate boardrooms and splashed across websites. And no, public shaming of “guilty” VC’s, a la, Brendan Eich isn’t going to change anything significantly, either.
  • The culture of litigation is overdone, overblown and over relied upon to “resolve” some of the most value driven issues in the country today: From healthcare legislation to gay rights, the courts and litigation are being relied upon to settle arguments that are about the human heart, emotions and values. But the law—which reflects and supports a dominant value system—cannot change individual hearts or values. Not even a little. Don’t believe us? Think about this: How many racists are still doing business, building companies and making money in America, post-1968?
  • The culture of the American judicial system has to change: Should issues be brought before the court? Yes, but don’t expect justice. People usually sue when their feelings are hurt (a heart based issue), when they feel as though they aren’t going to be treated fairly (a heart based issue) or they feel as though they won’t be heard (a heart based issue). This is the place where restorative justice circles, public conversation projects and other heart based, values based process need to be implemented at a wider cultural scale. Don’t believe me? Ok. How many personal stories from women who have been (or are being) sexually harassed, can the VCs at Kleiner Perkins Caufield & Byers (or other male dominated, hyper competitive VC firms), possibly hear in a room, before they change their minds and hearts? 200? 300? 1,000?

Tech oriented people, engineers, software developers, finance geniuses, and management leaders, like to operate in numbers, because numbers seem value neutral. After all, who can argue that 2+2 =4? But, when they have to deal with people, sometimes, they would rather not. Will VC’s in the Valley clam up, slowdown in hiring women, and become more closed, following the Ellen Pao verdict?

Maybe. Maybe it would be better for the culture of VC firms to model the attitude they try to foster in the culture of the start-ups they fund. But the rational hearts of the people who believe in numbers rather than values, are the ones that have to shift before the culture will.

-Peace Be With You All-

Jesan Sorrells, MA
Principal Conflict Engagement Consultant
Human Services Consulting and Training (HSCT)
Email HSCT: jsorrells@hsconsultingandtraining.com
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