The new book, The Venture Mindset, is
all about how to make smarter bets and achieve extraordinary growth. The authors,
Ilya Strebulaev and Alex Dang, explain that if any company wants to
win big in competitive times, they need to think differently. They need to
think like a venture capitalist (VC).
“This book teaches you to
spot new opportunities, nurture the right talent, foster a culture of innovation,
and take calculated risks,” say Strebulaev and Dang.
In their book, the authors
share nine distinct principles inspired by the unique way VC’s think:
- Home Runs Matter, Strikeouts
Don’t - Get Outside the Four Walls
- Prepare Your Mind
- Say No 100 Times
- Bet on the Jockey
- Agree to Disagree
- Double Down or Quit
- Make the Pie Bigger
- Great Things Take Time
These nine principles drive
VC’s unique behaviors that have flourished in an ecosystem of thousands of
startups, some of which went on to disrupt or create entirely new industries, according
to the authors.
They add that “some of the
lessons offered by the Venture Mindset are easy to implement, with immediate results;
others are less so. But each lesson offers a powerful opportunity to change how
you think and act within your own organization.”
As you read the book, you
will find a Mindset Check at the end of each chapter. Use these to answer
questions about your organization and think about what you may need to do differently
to achieve a Venture Mindset.
- Some of the questions
include: - Is your organization positioned
for making many small bets with the understanding that many of those will fail? - How open are your culture
and organization to unexpected ideas coming from outsiders? - Do you regularly interact
directly with entrepreneurs, executives, and experts to deepen your insights on
developments in your industry? - Are your meetings designed
to promote debate and open to disagreements?
Some of my favorite takeaways
from among the nine principles include:
- Pick your battleground.
- Don’t get too skeptical too early.
- Reward boldness.
- Look beyond short-term gains.
- Ignore temporary swings.
Today, the authors share these
additional insights with us:
Question: Of the nine
Venture Mindset principles, which one is typically the most challenging for a
business leader and his/her organization to master, and why?
Dang & Strebulaev: We work a lot with large organizations, and the
single principle that is hardest to integrate into strategic decision-making is
the idea that home runs matter and strikeouts don't.
The risk of failure is often
exaggerated, and established organizations easily ignore missed opportunities
until the next Google or Amazon gets big enough to disrupt their business.
Too often, everything inside
a large and established organization is designed against launching new, risky
ventures, with senior executives avoiding them as minefields. This is what
makes Silicon Valley tech companies so unique — they continue to invent,
experiment, take risks, and serve as innovation factories. More importantly,
every Fortune 500 company can do the same. However, this requires a mindset
change.
Question: Are the nine
principles to be learned sequentially?
Dang & Strebulaev: No, each principle itself significantly improves the
ability of a decision-maker to find and fund innovative ideas. It's not all
about luck; there is a method to the madness.
Everyone and every
organization can improve by dialing up the risk-tolerance level but in a smart
way. However, mastering all of the Venture Mindset principles is important.
Without a large funnel of
ideas, the effort is futile. Without killing your darlings (or less successful
ventures), the organization would spread itself too thin. Without long-term
commitment, you may give up too early.
So, to truly benefit from
the Venture Mindset, adopting all nine principles is important. However, a
journey of a thousand miles begins with a single step. To rephrase one VCs.
When is the best time to start? It was yesterday!
Question: How long does
it take for a business leader and his/her organization to master the nine
principles and fully transform their entity to one operating with the Venture
Mindset?
Dang & Strebulaev: We've seen how leaders change their behavior right
after learning about some of the principles. For example, the principle of
getting outside of the four walls can be immediately implemented, allowing
leaders to discover many new ideas right away. However, seeing the benefits of
the prepared mind principle takes more time. We've noticed that both of us have
also significantly changed our behaviors. We experiment more and test our ideas
rather than debating endlessly about who is right.
Transforming an organization
to become venture-minded takes time. It may take 2-3 years to make it a part of
the DNA of the organization. The challenge? It's not just about the leaders;
it's about the leadership team and key employees who often participate in our
workshops and become a team of intrapreneurs, initiating the venture mindset
movement.
Thank you to the book’s publisher
for sending me an advance copy of the book.
