Serial Entrepreneur Vs. Distracted Leader
Know the common indicators that reveal whether you’re a repeat founder ... or just a bullish wanderer.
A serial entrepreneur is a business founder who starts or acquires multiple ventures, often in a relatively short period. Common markers or characteristics of a serial entrepreneur include innovative ideas, a risk-taking personality, and, often, magnetic charisma.
Being a serial entrepreneur puts you at an advantage.
86% of "unicorn" founders have previously created other companies.
Elon Musk by James Duncan Davidson is licensed under CC BY NC 3.0
Elon Musk is a famous example of a successful serial entrepreneur. He started Tesla, SpaceX, the Boring Company, Open AI, and more. For Musk, starting new things works because his experience builds with every endeavor. He uses past learnings to inform present decision-making.
To become a true serial entrepreneur, founders must look back to see if any of their previous endeavors have been successful. If not, they may simply be distracted leaders.
By contrast, distracted leadership is marked by a sidetracked, discontented, and angsty business owner. And this preoccupation with unrelated opportunities doesn’t affect just the leader. Bain analysts have linked decisiveness to employee satisfaction. Team confusion, momentum loss, and “tremendous stress” are the result.
Adam Neumann, who led WeWork, is a good example of this pitfall. He made a string of manic acquisitions that Vox called “all over the board.” Oddly, some of the moves even seemed innovative at the time. Except, perhaps, the purchase of a massive wave-pool AI and manufacturing company.
We find another example of this discombobulated leadership in the founder of Mic.com, Chris Altchek, who unwisely pivoted to video-only, overbelieving the hype, and eventually had to lay off most of the company’s staff.
Neal Dempsey, managing partner of Bay Partners, writes that your previous endeavors are a good indication of your potential:
“You may be surprised to learn that investors, especially venture capitalists (VCs) like me, are not impressed by serial entrepreneurs. If after 10 tries you still haven't gotten it right, it's time to reconsider the entrepreneur life."
Research supports this. Professor Francis Greene, the chair of entrepreneurship and the head of the Entrepreneurship and Innovation Group at the University of Edinburgh Business School, oversaw a study of 8,400 startups. He found that, when compared to first-time founders, failed entrepreneurs were more likely to dissolve their businesses or go bankrupt the second time around.
Source: the Wall Street Journal, “Why Entrepreneurs Don't Learn From Their Mistakes ”
So start watching other founders. Look for indications of one leadership type or the other. It’s easier to assess others than yourself, so start here. Make it an ongoing observation, not a one-time research project, by subscribing to publications like First Round Review, Stratechery, and Strictly VC.
Then, be radically honest with yourself: Which type of entrepreneur do you most resemble?
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