Politics Is The Opposite Of Entrepreneurship

There seems to be one main similarity between politics and entrepreneurship; they both try to create change.  However, the methodologies that they use to make change happen couldn’t be more different.

Politics may seem like the older brother of entrepreneurship, but when you inspect politics close up it seems more like that unsightly Uncle, who smells a bit odd and may have spent time in prison.

The Entrepreneurial Journey

This is a summary of pretty much every entrepreneurial autobiography I have read.  I should stop buying these books, but there’s usually a few nuggets of valuable information in each book which are quite insightful.

The classic story of the entrepreneur goes like the following.  A young (usually male) person gets exposed to a gap in the market place or a pain point in their own life.  Fuelled by ambition, a longing to create a real impact and the hope of breaking away from a life of monotony the young entrepreneur experiences what is commonly called an “Entrepreneurial Seizure”.   This is the moment where he says “Screw it!  I’m going for it!”.  At this point no matter what his family and friends say, it only adds to the fire of ambition to go for it*.

Our young protagonist then gets started on creating their product or service.  Due to a lack of funds he sells his belongings, downgrades his car, takes on more shifts at work, rents out spare rooms in his house and starts wrangling banks and family members for some money.

The entrepreneur then realises that no matter how much money they gather, they won’t be able to create the business they saw in their vision by simply gathering money.  He needs to actually create a business which generates money and allows him to re-invest in the company and grow the business with money from actual customers.

With this knowledge in mind, the entrepreneur creates a streamlined business serving a small group of customers with a very niche product.

After months and possibly up to a year of hustling for new customers, autodidactism and networking the young entrepreneur finally hits product-market fit and has several million dollars worth of business a year.

Now it’s just a case of scaling the product or service to serve as many people as possible.

Before the entrepreneur knows it they are entertaining offers to sell his company at sums needed for an early retirement.

The Political Journey

Contrast the above journey with those involved in politics.

Someone in a given organisation or society wants to make a difference by changing policy.  Usually the ideas which inform these changes are borne out of class rooms, books, meetings and gossip rather than the kind of acute pain which causes someone to start a business.

Let’s take the example of an employee who is in a large organisation that wants to work his way to the top and make change happen.  She will necessarily go through a number of jobs and work up a hierarchy.  On this journey she will discuss her thoughts with people at the coal face and have a clear idea of the type of change she wants to make.

However, as she gets nearer to the top she will realise that the system is not as simple as she thought.  All of a sudden she will have to work hard to please shareholders, board members, unions, lobbies, fringe groups and also the people who are actually doing the coal face work which she wanted to help in the first place.

Usually this person will end up doing work which is ethically questionable on the way to the top.  “I know it’s not the right thing to do.  But, if I do this I’ll be able to get to the top and make the positive difference people need.  It’s for the greater good.”.

This type of cognitive dissonance seems to be quite prevalent among politicians.

When this person finally does get to the top, the policies and change she wanted to create will also get tainted by all the different vested interests mentioned above.  The fragment of a good idea that our politician had will be deformed from the start and likely not result in much of a change at all.

Contrast

My main point with this post wasn’t to display why politics is inefficient, but it’s to show how entrepreneurship and politics are fundamentally the opposite of one another.

Entrepreneurship is bottom-up.

Politics is top-down.

This also explains why politics rarely produces change that people want and why entrepreneurship must always result in change people want.

In entrepreneurship, when you build a product or a service, you have to generate money to allow it to keep growing and spreading.  To generate cash, you must have produced something that the market has to pay for.

All entrepreneurs know that their initial idea for a business will be way off course.  In fact because of this there has been a whole movement in the last decade called “The Lean Startup” which advocates getting something out into the market place, learning and iterating your business plan.  The assumption in entrepreneurship is that the founder actually knows very little with regards to what people want.  So you may as well get something out there and see if there is any traction.

This way entrepreneurship must produce products and services that serve people’s wants and needs from the get-go.

In politics, ideas are usually made in something like a boardroom.  Ideas do not get validated by something like “The Market”.

I find it quite interesting how even if politicians want to make change, they can never do it in the way they wanted.  This is obvious if you understand that there are too many vested interests pulling you in different directions, that the world is far too complex to understand let alone predict and that the world is in continual change.

*As I’ve mentioned before, starting a business, as long as it sticks to Thalesian principles is actually the wisest decision someone could make.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s