Monica Mehta is the author of the book, “The Entrepreneurial Instinct: How Everyone has the Innate Ability to Start a Successful Small Business”
With 15 years of experience in the industry, Monica Mehta is currently a managing principal at Seventh Capital, a New York based investment firm. She also writes a regular small business column for Bloomberg Businessweek and appears on ABC News and MSNBC. She joins us in this exclusive interview on entrepreneurship and investor dynamics in a changing world.
Q: What were some of the unusual responses and reactions you got when your book was released?
Some people interpreted the book as a political statement, a conservative battle cry of some sort. The book was released in the thick of the US presidential campaign and unfortunately the topic of entrepreneurship became highly politicised. Somewhere along the way, people of a certain political views began to associate entrepreneurialism with an uncaring, wealthy class. For a country that prides itself as a land of opportunity, I found it rather surprising that there were people attacking individuals that realised those opportunities.
Q: How can companies keep alive their entrepreneurial instinct after they scale up from being small to becoming large?
What kills entrepreneurialism in a corporate environment is an intolerance of failure. If an employee feels like the repercussions of failure are too great, they will take a conventional approach to all problems; inherent in the customary way is a built in excuse if things don’t work out. If you want to encourage your people to think outside of the box and take rewarding risks, then don’t punish them when they do and it doesn’t work out.
Also as companies grow and formalise, they add layers of bureaucracy in the form meetings and committees. The prefrontal cortex which is great for planning and strategising has been known to get in the way when it comes to agility and creativity. A corporation that wants to encourage entrepreneurialism should have a flat and lean hierarchy, particularly in the parts of the organisation that need to innovate.
Q. What trends do you see in venture capital movement from mature to emerging economies?
In the US for the past two years, we are seeing mid-size venture funds diminish as investors take a flight to quality. New money is flowing into the industry resembles a barbell in favour of blue chip Sand Hill Road firms and small, laser-focused funds often steered by experienced angels. Angels steer clear of emerging markets, unless they have special knowledge of the space. As brand name funds get larger they feel pressure to write larger checks. Investments in emerging markets are steered toward larger, later stage private equity deals that offer less risk and a clear path to exit.
Q. How should entrepreneurs strike that delicate balance between ‘Stick to your vision’ and ‘Adapt to a changed world’?
An entrepreneur needs both a vision and short term goals. The Vision is a roadmap for the subconscious mind; without a vision the entrepreneur has no destination. Short term, goals are the engine that will help you motor your way there. Keeping goals short term helps you not only helps you make brain chemistry work for you (riding one release of reward pathway stimulating dopamine to the next) it also provides for flexibility. When your day to day focus is on the near term, it is easier to stay adaptable and course correct the big picture vision as needed.
Q. What is your next book going to be about?
I write primarily to satisfy my own intellectual curiosity and have no plans to write another book at the moment. As a young mother, I have been thinking a lot about how the findings of the book can be used to raise more enterprising children. What I learned about the way our brains are wired shaped my views as a parent significantly. I worry less about school success and instead focus on building character strengths (perseverance, faith, respect), improvisational thinking and a bias to action.
Q. What is your parting message to the start-ups and aspiring entrepreneurs in our audience?
Stop aspiring. Go be your own hero!
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