During the last day of the visit we moved to San Francisco and had some different workshops with local professors, organizations that support “wanna-be” entrepreneurs and “wanna-be” entrepreneurs themselves. Just to make it clear, I call “wanna-be” entrepreneurs those people who want to get to the stage to be considered entrepreneurs. Those of you who follow my posts know that I just consider “entrepreneurs” people who exercise their theoretical (or Schumpeterian) function in society of finding new – and innovative – ways of trading something. People who are still trying to get there I call them just as “business people”.

San Francisco

In San Francisco we had the opportunity to meet the businessman Brandan Wallace, co-founder of Identified.com, a tool developed to compete with LinkedIn in a more junior – and facebook-like – job market (among other things, they found out that LinkedIn’s demographics achieves much more the senior profiles). Together with Prof. Blake Winchell of IE Business School, partner of Partner Ventures, and investor in the venture, they developed together some thoughts I not only share with them but would like also to debate with you:

1) In the market, usually, most of the people think that the entrepreneur (or the “wanna-be” entrepreneur, under my perspective) is the passionate guardian of the venture while the investor is “barely” the financial-minded part of the formula. In fact, quite often, the situation is the opposite. Think about it: there are a lot of investors out there with pretty much limited resources (let’s say, few millions). If they will put their money in something, they do have to believe in it, be passionate about it.

I met an investor in Brazil once that built his initial “venture capital” by selling part of the company he helped to build throughout some 15+ years of hard work. Me (and the local market – friends, press, etc) estimated he raised some 10 to 20 million dollars in that operation. He was explaining to me that he had only about 10 “shots” in his gun. So, he wanted ideas from IE students to consider investing on them. Imagine the emotional cost for this guy in believing in those 10 ideas. What if none of them worked? His whole fortune would be gone…

2) The myth of the great idea: Most of the “wanna-be” entrepreneurs think that their key contribution to the project is the “wonderful” great idea they had. I tell you something: the idea is not as important as people think. There are A LOT of hard work, appropriate networking connections and accumulation of positive outcomes from business decisions involved before the original idea become something really hot.

With years of accumulated experience, Prof. Blake estimates that nowadays the idea is responsible for about 5% of the success of a venture while proper execution about 95%. I not only strongly agree with him but also think that the tendency is that this proportion will considerably change in favor of execution as ideas become more and more available worldwide. Ideas will only keep relevance when deeply connected to “hard” intellectual property (patents) such as those for new materials.

3) In fact, “pivot” became the magical word of the moment in California. According to the Wiktionary, the word “pivot” comes from the French and Italian word for a very specific tool, usually made of metal, that allow us “to turn something using the same point of support”, like the base that allow the arm of a LP Player to move around (and reach different ideas):

A way of seeing the "famous" pivot

According to this way of thinking, ventures can turn mediocre ideas into billion-dollar companies. To get more information about this interest trend read Eridc Ries book “The Lean Startup”. I have not read yet it sounds interesting.

I had so may other hints from this last day but I do not want to make this post too long. Let’s get back to these issues soon…

Well, after the first – already mentioned – day with visits to Google, Electronic Arts and Symantec, in the next day we had a busy day meeting other members of the Silicon Valley ecosystem. We visited Plug and Play Tech Center, an inspiring incubator-like type of place, designed to support tech ventures in their early stages, check it out.

Visiting Plug and Play Tech Center

They call themselves “Startup Accelerators” or a kind of a “Silicon Valley One Stop Shop”, providing pre-seeding support and eventual partnerships with local Venture Capitalists. In 2010 alone, more than 150 million dollars were raised for some of the 170+ start-ups sharing the space. More than 3,000 business plans apply for a spot in the place in a single year.

Although I liked a lot the whole thing, in my humble opinion – as member of the e-learning “industry”, I think they are still too brick and mortar, promoting countless face-to-face events but very few online activities (it sounds quite contradictory, don’t you think?). In the picture you can see some of the most famous companies that started at Plug and Play: Logitech, PayPal and Google.

Entrance Plug and Play Tech Center

However, the most useful exercise was to listen to some of the founders of ventures currently hosted at Plug and Play: PasswordBank, Userzoom and iCharts. Their insights were really interesting as they explained all the process they had to go through to get to the level they are now, in a positive path.

Summarizing, their hints were:

- Just move to California if you have customers, competitors, investors and would like living in the US;
- Venture Capitalists are increasingly emerging in your home country, take advantage of them and your local network;
- Hire people with experience in small companies, not in big ones;
- In the US hire Americans;
- Don’t show up only with an idea. Ideas worth nothing. Bring a product;
- Clients in the US like to ask for a POC Prove of Concept (click here).
- Start by selling your product first (or gathering users); if you have growing sales/users, that means something;
- Try to hire software engineers in your own country, in the US they are expensive and you will compete with large corporations for talent;
- Try to start B2B before B2C (even if your business is B2C);

Well, I have more notes to share soon. Just would like to show something before. I had the chance to visit the Intel Museum and found this little chip in there, one of the first (material) things that I fell in love (!) in my life: a 386. I know it sounds really geek but I was really dreaming about this little thing when I was 15 years old.

Intel 386

I decided to join the group to see this new “feature” of these programs but also to meet some friends in the Bay Area and to look for activities in the Online Education and the Online Media industries. Almost 50 people formed this nice group of students, all with that ”crazy taste” of diversity that characterize all IE groups. They had some classes on Monday and Tuesday so I joined them on Wednesday, for the first series of visits to companies and players throughout the Silicon Valley. We started by visiting the famous Google Plex (see picture), where we were received by one of the many IE alumni working in the company: Marco Marinucci (International Executive MBA, 2004).

Marco is in Google since 2006 – a long time for the industry standards – and showed us the installations and the history of the Silicon Valley. After that, we got into an important review on the latest trends on mobile advertisement, with the Head of Gomo (Go Mobile). At the end I stayed with some key sentences from this visits: “Innovation is about what’s going to be next”, “Talent + Money + Creativity = Innovation” and “you cannot plan innovation, all you can do is try hard to be in the right place and prepared”.

Newton at Google Plex

But the day was just starting. We still went to EA, previously known as EA Sports. It is an amazing company, now struggling to quickly identify small innovative players to either acquire them or work with them, all over the world. From that visit I got with the sentence: “Videogames = Math + Art”. Where “Art” is the unpredictable variable.

Unfortunately I missed the last visit at Symantec where students were going to discuss about security systems. Overall I considered this first day a great welcoming day to start feeling what was the Silicon Valley about. I confess I knew a lot about it from my previous visit to the region and from many years of studying the subject, but still, it was a great day.

Since Max Weber, I think social scientists pretty much understand already how conventions are naturally established by humans and other animals to gain effectiveness in our actions and use of our brains (we tend to sit in the same seat, follow the same way back home and these kind of things). Take a read on Berger & Luckman’s “The Social Construction of Reality (1966)” for a nice introduction to that subject.

I am talking about a theory that can gather Einstein’s suggestions and combine its consequences with every social aspect of our lives, a theory that can make us to rethink the role of any kind of “constant” social behavior and physical condition.

Let’s think about it: the Earth attracts us to it, just like the Sun attracts the Earth to it. You may not have thought about it but we also attract the Sun and the Earth to ourselves with a tiny force derived from our masses and therefore we also distort space and time by our individual existence just like the Sun or any other mass in rapid movement. I won’t enter into the question about where those gravitational forces come from because then we would get too philosophical (some people believe that gravity is the closest thing we know to God).

In any case, my weird correlation is: just like every mass interact with each other in the universe distorting each other’s physical reality in different degrees, we humans also distort each other’s perceptions on ourselves due to the relativity of all our conventions that are merely based on unreliable and imprecise social definitions and physical evidences that should not be perceived as truth ever (and I think we should have been told that when we were young).

The Persistence of Memory, 1931

Words gain meaning with time, individually to each one of us, changing according to the use we give to them and the experience we have with them over time. I can assure that the meaning of the word “love” for you is different from the meaning it has to me. Moreover, the meaning of the word “love” for you today is different from the meaning you will give to it in 5 years. And even the way the word sounds is affected by the wind and the air chemical composition (like humidity).

The values of gold or money are also just conventions that mean nothing more than some kind of physical representation of certain local social power; especially under this “social game” we have been playing called capitalism. The Incas had a completely different relationship with gold, for example. Besides, the weight of an ounce of gold also varies according to the position you are in the planet since we now know that the force of gravity is not constant around our not-so-rounded Earth.

How about the time? Besides the distortion caused by all other masses surrounding us, our planet and solar system, we now know that not every day lasts a day and not every year lasts a year, so our “sacred” seconds, minutes and hours are all mere simplistic representations of a time that is not so fixed as we wished. Consequence: don’t worry if you arrive a minute late to a meeting. Nobody knows the exact time anyway. :-)

Gosh! Everything seems to be so complex! And I am not saying that in the Parsonian sense of the expression :-) but in a social-physical angle that apparently nobody dared to merge yet. I don’t know why, but Dali’s “Persistence of Memory” came to my mind while I was writing this. Perhaps because I am living in Spain and I do think that the Mediterranean people have been facing these complexities with a pleasant sense of disdain that amuses me. Olé!

Well, I have some news for you: we all are going to die, one day or another. We end up so alienated towards death because we naturally don’t want to die, so we just forget about it. We are not capable to get use to the fact that life and death are just two sides of the same coin. I faced death 3 times in my life and I can assure that if it is quick you won’t even notice.

Today we are here, your eyeballs read these characters in your screen, written by my fingers, and tomorrow maybe your eyeballs or my fingers will be rotting like any lifeless meat would do. Who cares? Some relatives, few friends… It doesn’t really matter actually. Only few things that you did will be left behind: a document, a table, some money, a child perhaps. Still, it doesn’t matter anyway because even the Earth is temporary.

So what is life for? Again, unfortunately, nobody knows. Maybe is to appreciate death? Or maybe just to play with her? I may be sounding too pessimistic, apocalyptical or just non-sense but in fact it is precisely this brevity of life that amuses me every single day. Not like paranoia, but like a strange luck that makes me feel “hungry and foolish” everyday (like the Steve Jobs’ famous “do-what-you-love-to-do” speech, below). After all, learn how to ride a big motorcycle over roads and mountains ahead of you is amazing.

The trip itself reminds me about the countless bus trips I took during my youth, including some unforgettable ones throughout Brazil, Morocco and India. When you remember those trips after so many years, it looks like they were much more pleasant than they actually were, a phenomenon certainly caused by this weird “aging” effect I’m suffering at the age of 35 (in the recent past, I still could list every single new year’s eve I had in my life, now they are starting to get all mixed in my mind).

Well, still, I have very good memories about those trips. I like bus trips, I can almost feel the tires touching the road, and this makes me feel more connected to our apparently vast planet Earth.

In Brazil, I remember a 500km bus trip I did from Corumba to Bonito, all within a single Brazilian State called “Mato Grosso do Sul” (and this was just like a third of the State!). That was “pure” nature… During the trip you could feel the Pantanal’s warm and humid air while seeing al sorts of animals around the empty bus.

In Morocco, I remember two increadible trips: one from Madrid to Marakesh (!), a 30 hour “non-stop” bus trip that would make anyone sick (curiously, the “border” between Spain and Morocco was inside the ferry boat our bus embarked). And another 10 hour bus trip to the Sahara desert directly followed by a 6h camel ride at night simply unforgettable, with one of the clearest sky I think anyone can see in the world.

In India, the experiences were not that “easy”. I couldn’t skip the city buses of Kolkata, were chickens, passengers and inconvenient stops for refuel inside the buses (with people smoking just steps away from the gasoline) would make anyone feel like being inside a surreal Spanish movie. More shocking indeed was a 30 hour trip from Kolkata to Siliguri (in Sikkim) in a bus with rows of 5 seats packed with people and luggage enough to make the place almost airless. I swear I felt I could die that day. In fact, me and some colleagues got really sick for 2 days after that trip.

This Spanish ride is so calm and comfortable that in 10 years from now I won’t probably remember this bus trip, but I will certainly remember the peaceful period I lived in this wonderful country.

During this process, I found a Brazilian artist I liked a lot during my adolescence: Raul Seixas, an old pop icon in Brazil. For those of you who have heard of Paulo Coelho (the famous Brazilian writer), bear in mind that the they worked together creating some of the most amazing songs of that time. Just as a curiosity, I found a video of them during a trip to the US in the 70′s (that is interesting only if you’ve heard of Paulo Coelho before):

Well, the song I found more interesting to hear again and explore was this one, “Ouro de Tolo” (Fool’s Gold), one of the first musics composed by Raul Seixas, inspired by Bob Dylan, that talks about the “perfect job” promised by the Brazilian government under the dictatorship installed to assure the development of capitalism in the country during the cold war. I suggest you to listen to the song and read the lirics and its free Google translation. It is very interesting and made me think about this interesting moment of my life:

Eu devia estar contente porque eu tenho um emprego
I should be happy I have a job
Sou o dito cidadão respeitável
I’m the so called respectable citizen
E ganho quatro mil cruzeiros por mês
and I earn 4 thousand cruzeiros a month

E devia agradecer ao Senhor
And I should thank the Lord
Por ter tido sucesso na vida como artista
for having achieved success as an artist
Eu devia estar feliz porque
I should be happy because
Eu consegui comprar um corcel 73
I managed to buy a ’73 Ford

E devia estar alegre, satisfeito
And I should be happy, pleased
Por morar em Ipanema depois de ter passado fome
for living in Ipanema after having starved
Por dois anos, aqui, na cidade maravilhosa
for 2 years, here, in this marvelous city (Rio de Janeiro)

Eu devia estar sorrindo e orgulhoso
I should be smiling, proud
Por ter finalmente vencido na vida
for having finnaly succeeded
Mas eu acho isso uma grande piada
But I find it all a great joke
E um tanto quanto perigosa
a rather dangerous one

Eu devia estar contente por ter conseguido
I should be happy I got
Tudo o que eu quis, mas confesso
everything I always wanted, but I reckon
Abestalhado que eu estou decepcionado
stunned that I’m disappointed

Porque foi tão fácil conseguir
because it was so easy to get
E agora eu me pergunto, e daí?
And I ask; so what?
Eu tenho uma porção de coisas grandes pra conquistar
I have many great things to achieve
E eu não posso ficar aí parado
And I can’t stay stand

Eu devia estar feliz pelo Senhor ter me concedido
I should be happy the Lord gave me
Um domingo pra ir com a família no jardim zoológico
a Sunday to go to the zoo with my family
Dar pipoca aos macacos
give popcorn to the monkeys

Ah, mas que sujeito chato sou eu
oh, but what a bore guy I am
Que não acha nada engraçado
I can’t find fun
Macaco, praia, carro, jornal, tobogan
Monkeys, beaches, cars, newspapers, tobogan,
Eu acho tudo isso um saco
to me they just suck

É você olhar no espelho
You look at yourself on the mirror
Se sentir um grandessíssimo idiota
You feel like a great idiot
Saber que é humano, ridículo, limitado
Knowing you are human, limited
Que só usa dez por cento de sua cabeça animal
and you use just ten per cent of your animal head

E você ainda acredita que é um doutor
And you still believe you are a doctor
Padre ou policial que está contribuindo com sua parte
A priest or a policeman doing your part to contribute
Para o nosso belo quadro social
to our beatiful society

Eu é que não me sento no trono de um apartamento
I don’t sit on a couch in an apartment
Com a boca escancarada, cheia de dentes
with my mouth open, full of teeth,
Esperando a morte chegar
waiting for death to arrive

Porque longe das cercas embandeiradas
because far away form the decorated fences
Que separam os quintais
that separate yards
No cume calmo do meu olho que vê
at the calm peak of my seeing eye
Assenta a sombra sonora de um disco voador
there rests the shadow of a flying saucer.

Just for curiosity, I attach Raul’s own translation of “Ouro de Tolo”, in a version of the song in English:

And also the history of the song told – in Portuguese – by journalist Ana Maria Bahiana: http://soundcloud.com/factoide/historia-de-ouro-de-tolo-do-raul-seixas

This thing was in the table for discussion because this alumnus was considering moving with his wife to Brazil just like many other current MBA students and alumni worldwide. Why are they considering it? Obviously because of the economic boom the country is facing and foreseeing. Most of them know that whoever gets there first, have an enhanced possibility to succeed professionally in the medium or long term. My argument to question this perception is that Brazil, just like any other country in the world, won’t grow forever (especially when anyone can see that most of the assets are already priced at international levels). The issue of growing or not growing per se couldn’t be sufficient, during these times we live, to make somebody consider living in another country.

But getting back to the issue of growth itself, how people expect the world to be when everybody gets their basic things for living? Japan, Europe and the United States are already starting to face this challenge. How many more cars an American must have to feel happy? How many sofas, beds and TVs? How many more bottles of good wine or luxury bags Europeans need to be happy? When the world population starts to decline by the second half of this century, there will be far more houses than people to live in them. Water is there, food is there, roads are there, schools are there, and almost everything is basically available to large parts of the population in these so-called developed countries (although the concept of “almost everything” obviously changes from region to region and from people to people).

Venus Project: example of a town

But this is not the problem. The problem is to see that there aren’t many people studying real alternatives to this critical dead-end street we are moving toward. Initiatives like the Venus Project are exciting but in my opinion too unrealistic to be implemented in a large scale yet in this century. And we have to hurry up if we don’t want to see Karl Marx‘s predictions on “capitalism consuming itself” to happen. For me, together with Max Weber, Marx was one of the greatest people in “recent” history that really spent time to understand what capitalism was about. Whatever people did in his name afterwards (in Cuba, Russia, China, Venezuela, etc) simply did not represent his thoughts neither valid attempts to put in place improved human social, political and economic structures at all, in my opinion.

I think a more realistic approach for us to start solving this problem is not only via pressures for more sustainable development but mainly through the reconceptualization of overall governance indicators for private and public organizations. A new accounting science has to emerge soon, one that not only measures physical assets but mainly and more important things that are important for people and ecosystems to live in peace.

Reporter: What were the findings?
Newton Campos: The main conclusion was that the social context, in this case “Latino”, had more importance in the process of enterprising than the level of economic development of countries and their institutions. That is, the incentives and obstacles that innovative entrepreneurs obtain from their networks in these countries are relatively similar, regardless of the country’s level of development, when comparing entrepreneurs who started from similar social classes.

The view from my window at the hotel in Campos do Jordao where I spent about 14 weeks (in about 12 trips) in order to have the dissertation done.

Reporter: Why considering the work relevant?
Newton Campos: Because it might enrich the global knowledge about the initial process of innovative entrepreneurial success in Latin countries. That is why I decided to follow a specific methodology that enables future comparison between entrepreneurs from different countries, and wrote the dissertation in English. Thus, a Chinese, Mexican or Indian could replicate the study for their region or compare their findings with ours. A proper debate on this process in emerging and developing countries is still starting.

Reporter: What was the theoretical contribution?
Newton Campos: In addition to confirming that the “social” is more important than the “economic” also in the Brazilian and Spanish context, as previously mentioned, I think it was the opening of a new line of research, the one I’m working today. This theory argues that the obstacles to entrepreneurs may be as important as the incentives that governments around the world relentlessly try to bring down today. These governmental bodies and universities should also be identifying obstacles that will generate truly innovative entrepreneurs in their regions instead of thinking only in breaking down barriers and even erroneously encouraging the emergence of new entrepreneurs who contribute nothing to the sustainable development of the world.

Reporter: Why did you decide to join the academy?
Newton Campos: Because I was dissatisfied with the loss of focus on the intellectual journey that I was having after the MBA. The MBA is an eminently practical training, but that indirectly makes you think too much in the development of capitalism worldwide. I started reading authors each day more interesting and more complex, but could not follow an investigative line that could kill my doubts, I felt I needed guidance to facilitate my intellectual evolution and realized that the academic career would be one of the few which would value this type of questioning. So I started the doctoral program in 2006.

Reporter: What was your research question? I wanted a brief summary of your dissertation.
Newton Campos: My research was directed to the social context that surrounds the entrepreneurs during the development of their businesses in Latin countries. As “social context” one may consider the entire network of contacts established or used for business success. I need to clarify that I do not consider entrepreneur those who own small businesses or companies, these are micro or small business owners to me, which eventually may even become entrepreneurs. The research tradition that I follow considers entrepreneur only that person or group of people who innovate during the process of building a project or an organization. Plus, this innovation has to be considered socially or financially successful, otherwise we neither would be talking about an entrepreneur yet. Moreover, much of the existing literature on entrepreneurship in 2006 also put the entrepreneur in a “developed” social context, usually the U.S. or Europe, where the “rules of the game” (market rules and institutional ones) are established in a specific manner, usually very different from the rules that exist in different parts of the world. It was from this observation that I got my research question: How does the social context influences the entrepreneurs at the beginning of their enterprise in a developing country? But the claim was only one stage in the search for this response. During the search, before I even started the dissertation I made a trip to pre-earthquake Haiti (in 2007) to see if it would be possible to observe innovative entrepreneurs in a social context as politically and socially unstable as in a country like Haiti, which was already at that time among the 10 world’s poorest countries. To my surprise I found many innovative entrepreneurs, some even known throughout the Caribbean. Amazingly, the market innovation was there, present in one of the most miserable places on earth. After that, in the thesis itself, I did a comparative study between two countries relatively similar from a cultural standpoint, but different in terms of social and institutional development: Brazil and Spain.

In the next part of interview I will talk about findings and theoretical contributions of my research.