I come from a family of public schoolteachers in Roanoke, Virginia. My mom is an art teacher; my aunt, a math teacher; my grandmother, an English teacher; my godmother, a history teacher. I was raised by these women -- smart, determined, hard-working women. Their classroom principles have stuck with me, and I apply them to my work with entrepreneurs every single day.
First, you can solve just about any problem you set your mind to, if you're willing to study hard enough and be humble about what you don't understand. My family always emphasized the last part: It was always better to be the hardest working student in the class, for whom the material doesn't come as easily, than the know-it-all who was too big for his britches. To stay humble, you can't fake it when you don't fully capture a concept the first time. Instead, you should always ask for extra help from those who can best adjust your perspective, clarify your focus or even widen your frame. Sometimes that's from the teacher; sometimes that's from your parents; often it's from your peers.
When it comes to supporting entrepreneurs, we have found the same thing. Too often, early-stage businesses have a sole focus: "What do I need to say to raise money?" Startups are more successful when founders are most open to learning -- and not just from the investors they are trying to please. In an agriculture-focused program in Louisville last year, we watched as several of our businesses changed their plans dramatically after meeting with farmers, community groups, and other stakeholders. Some ignored what they heard, but the best entrepreneurs listened attentively, with humility. They identified customers' greatest inefficiencies, inconveniences and unsustainable practices, and they discussed how business solutions should be built -- completely based on the risks and rewards found in those everyday realities.
Because this advice from community members matters so much, we now hold customer forums with every cohort of entrepreneurs. When we return to Louisville later this year, our businesses will not pitch to a panel of investors they hope to charm, but rather to a roomful of actual customers who could buy their product.
Second, don't assume one approach will work with all problems. You've heard the phrase, "When you've got a hammer, everything looks like a nail," right? It is a natural tendency. When a student learns a formula, it's easiest to apply that method to all other questions in the problem set too. Sometimes that will work just fine. My grandmother, at 97 years young, still reminds me that anything worth saying can structured with the "introduction / three main points / conclusion" format and be said in less than a thousand words. But often, such habits stifle problem-solving.
In the classroom, the ability to contend with new ideas matters as much as being able to apply familiar concepts. It's the same for entrepreneurs -- not to mention those of us building programs to support startups. We have a tendency to conjure up solutions and then start looking for the problem to solve with them. But here is the issue: Demand may or may not exist for such a solution, or the problem they think they see might actually not be that great of an inconvenience to their target customers. Entrepreneurs (and those who support them) need to focus on the actual problem we are trying to solve.
We address this by designing our programs around problem statements, which are broad enough to solve an important, tangled-knot of a problem, but specific enough to bring a dozen similar businesses together to address its various threads. For instance, we don't look for "businesses that are going to improve Utah's economy and strengthen the community," and open ourselves up to a free-for-all. Instead, we begin a deliberative process, considering what the Salt Lake City economy and community wants and needs. With local leaders (anchored by the University of Utah's Sorenson Global Impact Investing Center), we identify assets unique to the community; in this case, we found a strong ecosystem supporting financial inclusion. As part of our nationwide SOURCE initiative, we strategize with our partners at Investors’ Circle and the Hitachi Foundation and host local roundtables. We also partner with leading private sector companies who care about similar issues. We all benefit: Their subject matter expertise adds to our program, and working with our entrepreneurs gives companies new insights about what’s next in the field.
Together, we then issue a call for "the best businesses in the United States that are focused on improving access to financial services for low-income Americans." We've developed a pipeline of hundreds of enterprises over the past month alone, and the top dozen or so will join us in Salt Lake City and Silicon Valley. But it only works because we got the problem right.
Third, once you feel like you've accomplished something, you should question whether you've really arrived yet. More important than gleaning good grades, true education requires cultivating a certain attitude of mind, one which is always resisting assumptions and revisiting facts. Your growth, not the first fruits, will matter the most. Entrepreneurship requires the same attitude of mind. It's about problem-solving: Not only solving for the central business issue at hand, but also planning for other market inefficiencies and breakdowns surrounding it.
The more you challenge your own assumptions, the better your plan will be. The more you can mitigate your risks, the better your business will be. And the more you can create the types of markets that you want to be doing business in, the better your company will be for your consumers and community.
At Village Capital, we are always learning and adapting; for more on that, our Executive Director recently wrote an in-depth analysis of how we've grown. For now, I'll just conclude with this: To my folks back in Roanoke, this essay is at 999 words, so we can all be thankful that some of your advice must have stuck with me after all.
This post is part of a series produced in partnership by the Global Innovation Summit and The Huffington Post around impact, innovation, and technology. For more information on the Summit, click here.