Ask any of the founders behind Harvard Business School’s most successful startup — from clothing swap service thredUP to website optimizer CloudFlare — and they’ll all point to a single common denominator as key to getting a business off the ground. Tom Eisenmann, Harvard’s veteran entrepreneurship professor whose legendary Launching Technology Ventures course has helped legions of budding entrepreneurs find their focus and bring their ideas to fruition. Eisenmann co-chairs HBS’ Rock Center for Entrepreneurship, the campus’ nucleus for new ventures, and leads trips to Silicon Valley and New York for students eager to experience America’s innovation epicenters firsthand.
While Eisenmann looks the part of the tweed-jacketed, Ivory Tower professor, his knowledge of cutting-edge startup practices has won him a dedicated following that extends far beyond academia. But in the classroom, Eisenmann’s genuine interest in his students sets him apart. From nudging them in the right direction when their ideas are out of whack to slipping business cards to those who couldn’t get in his classes, Eisenmann is known for his open door and sage advice. In an interview with Poets&Quants, he shares his insights on entrepreneurial MBAs’ most common mistakes, the Steve Jobs effect and the worst idea he has ever heard.
What are the most common misconceptions your students have about launching startups?
I think we can talk in class about how hard it is to be an entrepreneur and the ambiguity of it all, but it’s hard for them to understand. In most jobs, somebody gives you work. But if you’re an entrepreneur, you must decide what’s going to happen or nothing will happen. It’s this notion that there’s total ambiguity, and it’s all up to you.
I think they also underestimate the emotional ups and downs and the amount of time they’re going to spend selling. Very few MBA programs, ours included, do a good job of teaching sales. And in entrepreneurship you are constantly selling to a new employee, investors, customers, and partners. But we don’t teach it very well, and people aren’t drawn to it. So when students are about to launch, they don’t realized how much selling they’re going to do and how much they are going to have to put themselves in front of people over and over again. In any kind of sales there’s a lot of rejection, so there’s a lot of emotion that comes with being told ‘no’ nine times out of 10.
We can tell students what the failure odds are, but it’s one thing for people to know the stats, and it’s another to actually feel it’s going to be you. A lot of people think they will be that one person to beat the odds, and I guess that’s good to have that confidence. Basically we need people to be a little delusional.
What are the most common mistakes that MBAs make when launching startups?
A lot of what we do in the classroom is teaching students to take an idea, turn it into a business model, break it into pieces, and figure out how to evaluate it. But an awful lot of entrepreneurs don’t do that, and they rush into their vision.
There are also a lot of young entrepreneurs who don’t want to expose their idea until it’s perfect. Or they fail because they’re too headstrong, and they keep pushing the idea when the whole world is saying no. Other students flip around too fast from idea to idea, and some never quite quit the day job because they don’t have any confidence in their idea. So there’s a zone between being headstrong and lacking resolve that students have to live in.