The Time for Parallel Entrepreneurs
The “parallel entrepreneur” idea has been around for a long time — since at least Edison. Even in technology, it’s been around since the beginning of the commercial Internet and even before. But it seems to be intensifying now. With betaworks, Science, Obvious, and others, some great entrepreneurs are making more than one thing at a time. They’re also investing while they build, and being flexible on the ownership and corporate structure for the products and companies they count as affiliates. Why? The obvious: finding a new product’s market keeps getting less expensive. No need to commit to a single instantiation of how your product must be if you can try dozens of meaningfully different variations and get real user data. The Lean Startup movement has only accelerated this. Now, I’m side-stepping a lot of valid questions (some discussed in this wonderful Branch thread) about how to balance focus with the create-lots-of-things-in-parallel world. Maybe less obvious:
The lines between products and companies are blurring. It used to be a product was owned by a company, and a company had one or more products — that was it. Now, with APIs, open source tools, products being launched before companies are formed, this rigid one-to-many mapping has broken, in a good way. The company itself is an old institution, it works well for many things (clarifying ownership and accountability) and less so for others (shepherding the messiness of new creation).
The professional divide between “operator” and “investor” is dissolving. Most entrepreneurs I know also invest in startups. Most full-time investors I know were previously operators. Many great talents I respect now have some-of-this-some-of-that professions (a fund that also builds startups, a side gig as a partner in a venture fund, etc.). Big venture firms now have substantial operating practices that recruit, market, design and do other day-to-day tasks once reserved for their portfolio companies. I do sometimes hear people saying “being an investor is a truly different set of skills from being an entrepreneur” — that may be true, but it is becoming less so every day.
There are natural reasons why both investing and operating is a good thing to do. Great operators allocate resources to different tasks — one of the most important resources being capital. Great investors have a deep understanding of the fabric of how stuffs get built.
Talent is getting more sophisticated, so companies can now recruit on messages other than “here’s our product vision.” A single emotionally (or financially) compelling hypothesis is still a great recruiting tool, especially for drawing the talent that likes to work on things where they feel a sense of purpose (the best talent!). But there are other recruiting tools: force of personality (or better, reputation) of an entrepreneur can really work now. And the evolving notion of a career — as a portfolio of activities vs. a succession of full-time jobs — means that talent is happy to pop in and pop out on projects in different and uncertain phases. This blurriness of professional affiliation is a real positive for parallel entrepreneurs.
The cost of specialists — and their value — keeps rising. Whether its A/B testing, acquisition marketing, SEO, not to mention software engineering — there are now phenomenally wise experts in each of these areas (and plenty of snake oil salespeople, of course). The right expert is worth it, but expensive, and may not be needed full time — so much easier to justify across multiple products. (This is a point Mike Jones of Science made in that Branch thread.)
Early-stage consumer products have become so competitive, that the “lottery” effect of finding a winner is becoming more pronounced. It’s just so hard to find a new vein that isn’t yet tapped. Early stage products, today, are a Plinko game.
That said, as with anything, true greatness may require that focus thing. I’ll leave that debate to… others, another time, something other than right now. Can’t focus enough to write that part up :)
