Leaving Safe Harbor

The wind was a steady 25 knots gusting to 30 at 10am Saturday morning. Outside the harbor break wall the waves were 8-10 feet rolling South towards our next port of call and I had a decision to make: Stay put or leave our safe harbor to engage the open water towards our next adventure.

This experience last summer during my sailing trip around Lake Huron and the North Channel is the best analogy I have to what entrepreneurs go through when they are wrestling with the decision to quit their job and pursue their venture.

Most people (and most sailors for that matter) grow comfortable in their current job or role and feel protected from the turbulent waters of startup life. Creating something from nothing is always more difficult and uncertain which causes many of us to stay moored to our dock while the beauty of the storm roles by outside our walls.

I use the word beauty purposely to describe the storm. There is something about nature’s fury and power that is amazingly beautiful to watch. The challenge it creates to survive, the mental quickness, the physical strength, the courage it demands all bring to the surface a heightened state of awareness that makes life so wonderful.

I ask entrepreneurs to weigh carefully whether or not they want to engage life at its fullest or would they rather enjoy the relative safety of “harbor life”. Yes, being an entrepreneur is exciting but it is not easy. I have found that the feeling of satisfaction, however, that one gets when accomplishing something they themselves may not have thought possible is unbeatable!

As I reflect back on those moments of leaving safe harbors I can see the entrepreneurial parallels unfold:

At 10:15am on that Saturday my family and I dawned our life jackets and checked over our vessel to ensure it was as prepared as possible for the challenges ahead. We then enlisted the help of the dockhands at the state marina to help shove us off and provide the moral support we needed for the rough journey ahead.

At 10:20am we took a deep breath and cast off our lines and engaged the auxiliary engine to guide our sailboat out of the safe harbor and pointed her towards the surging waves ahead.

At 10:25am we rounded the break wall and braced ourselves for the first 10 footer which shook the boat as if awakened from a deep sleep. I could see the fear and questioning look of my crew regarding our decision to leave our snug harbor.

At 10:30am we dug deep into our reservoir of courage, raised our sails, turned to the proper course and headed towards our next port of call.

Finally, at 10:45am we were sailing at 8 knots due South and enjoying every minute of it! The waves, although big, were actually fun and our fear turned to excitement as we rode down one wave and up onto another not sure what each new crest would bring. The wind, which sounded intimidating in the harbor, was less intense at our backs as we ran with it towards our destination. Our sense of accomplishment and triumph over our fears was intoxicating!

I’ve had the privilege of working with so many amazing entrepreneurs during my last four years as Executive Director of the Center for Entrepreneurship at the University of Michigan. I’ve seen the look of fear and excitement in the eyes of some of the most amazing individuals and have been blessed to call many of them now my friends.

As I step down from my role as Executive Director to embark on my next entrepreneurial journey I pause while I’m surveying my ship and watching the rolling waves that lay ahead and reflect on how incredible the journey has been and how humbled I am at the tremendous source of talent at the University of Michigan and the team who run the Center for Entrepreneurship.

Then I slowly untie my dock lines…. smile in anticipation of the battle ahead… and cast off.

Go Blue!

Follow me @DougNeal_MI and my new ship - Michigan eLab


Posted in Entrepreneurship | Tagged , , , , , , | 2 Comments

Can startups do battle with giants?

I’m often asked by people if a startup really can compete with a behemoth software company like Microsoft?  After all, couldn’t Microsoft just turn their attention on any startup and squash it like a bug?

In theory, possibly… but in reality, not likely!  Big companies are usually so full of bureaucracy they can’t even do small things right (or fast).

For example, I recently spent several hours wrestling with Microsoft’s Xbox LIVE billing system simply trying to purchase an Xbox LIVE Gold Account.

Hey Microsoft, want to know how to double Xbox LIVE Gold Account sales overnight? Stop making it so hard to accept our money!

Seriously, I’m sure there is a product manager somewhere inside Microsoft’s bureaucracy looking at the Xbox LIVE sales numbers and pondering what new marketing plan could move the needle on her product sales and achieve her quarterly MBO objective but that product manger is obviously not using her own product!

When I work with entrepreneurs who are looking for ways to increase their product sales I’m always surprised how few of them have taken an objective look at how their own product is purchased.  Simply watching someone try to buy your product can be tremendously enlightening.

We make assumptions every day that customers are just like us when in reality they are very seldom anything like us.

In this example, Microsoft completely blows the customer experience (way beyond usability).  No startup should ever make these mistakes:

1)   If you offer a payment option button make sure the payment option connects you to a website page that exists (really?)

2)   Once you fix this problem make sure that you can actually process the credit card when someone fills out newly created page (amazing)

3)   If you offer online chat support provide connections to people who are paid to help you and do not connect with other frustrated users (your killing me!)

4)   I liked the option to fill out a form to have a tech support agent call you back when they are free but why not enable the button so you can submit it?  (OMG!)

5)   Always good to give someone who calls the phone support directly the same “we’ll call you back” option via your automated phone system but when you do call them back don’t dump them back into the wait queue again!  (this has now become personal)

6)   When your tech support agent does finally answer the phone please don’t insist that the customer registers more secret answers to secret questions before helping them… and if you do please do not act confused when matching the secret answers to the secret questions (secretly hoping a meteor will kill me now)

7)   When your customer politely asks how your tech support agent can easily register the same credit card and the customer, despite hours of trying, could not don’t simply shrug and say – “yeah, that seems to happen a lot, is there anything else I can do for you today”?

Customer experience is critical for being a successful company and those that don’t understand this are doomed.

Seeing the problems Microsoft is having simply processing payments on their website makes me feel pretty good about doing battle with giants.

Posted in Entrepreneurship | Tagged , , , | Leave a comment

How do you know when to jump off the cliff?

One of my favorite entrepreneurial quotes is by Reid Hoffman, the founder of LinkedIn.  Reid wrote:  “The entrepreneurial journey starts with jumping off a cliff and assembling an airplane on the way down.”

This perfectly captures the essence of the fear, leap of faith, commitment and urgency that surrounds the entrepreneurial journey!  But it doesn’t answer the big question of “when to jump?”

Dave Girouard, the former President of Google Apps and founder of Upstart spoke at our Entrepreneurship Hour class last week and said that it was a really tough decision for him to leave Google and step out on his own.

“At some point you just can’t stop thinking about the idea,” Dave remarked when asked by a student how he knew it was time to leave Google?

This is, by far, one of the biggest fears and barriers most entrepreneurs will face and actually prevents many would-be-entrepreneurs from getting started.   People will carry around with them an idea for a startup for years but fail to execute on it for fear of letting go of what they have.

“I have found that if you ask people how much money they need to feel financially secure before leaving their job and their answer is always exactly 2x what they currently have in the bank,” says Jessica Ewing, a former Googler who recently moved to Ann Arbor.  “If they have 50K they tell you they need 100. If they have 10 million, they will tell you they need 20!”

Here are some techniques that people I’ve spoken with use to determine when is the best time to jump:

  • Analysis:  Spend some time weighing the pros and cons of the new opportunity against the lost opportunity you have when walking away from your current situation…  then set that aside and reflect on what is truly important to you and what type of impact you want to have on this world.
  • Carpe diem:  For some people, the opportunity to do something amazing is what finally pushes them over the edge.  Robin Williams summed it up best in Dead Poets Society when he said “Carpe diem.  Seize the days, boys.  Make your lives extraordinary.”
  • Take a shower:  “What is the idea that you think about most in the shower?” said Thomas Zurbuchen, Associate Dean of Entrepreneurship at the University of Michigan.  “When you find yourself thinking in the shower about your new idea more than the times you are thinking about your current job you know its time to leave”.

Ultimately, jumping off the entrepreneurial-cliff and starting your journey is a very personal decision.  I have been at the edge of the cliff multiple times in my career and I haven’t regretted the leaps I’ve made, the planes I’ve built or the crashes that have sometimes occurred.

For me, entrepreneurship is a way of life and I couldn’t imagine things any other way.



Posted in Entrepreneurship | Tagged , , , , , , , , , , , | 1 Comment

3 Days, 80 Scientists, 300 Customer Interviews

This week was the kick off of the University of Michigan Innovation Corps (I-Corps) summer session where 80 scientists, engineers and mentors gathered in Ann Arbor to participate in the 8-week entrepreneurial-immersion program developed by Steve Blank and the National Science Foundation (NSF).

For those not familiar with I-Corps, it is an intense entrepreneurial training program that puts researchers, entrepreneurial-leads and mentors (teams of 3) from Universities across the country through an intense simulation of a startup environment over an 8-week period.

The purpose of this program is to teach these teams the fundamentals of entrepreneurship via hands on learning using the Customer Development process and identify a potential business model that they can use to bring their technology to commercial availability.

We believe in learning by doing and the lectures were a small percentage of the time spent where a majority was reserved for “getting out of the building” data gathering via customer interviews, followed by regular team presentations and feedback sessions from the teaching team.

On day 1, the UM teaching team and the NSF both stressed that we would be pushing the teams outside their comfort zones, asking of them the impossible and, most importantly, holding them accountable.

Many of these researchers have only talked to a couple of customers prior to arriving in Ann Arbor despite having spent months, even years developing innovative and potentially disruptive technology.

By day 2, many of the teams had one-on-one conversations with more than 10 different potential customers.  Some had completed more than 20!

In all, 300 distinct customer one-on-one interviews were conducted in just 3 days and it was absolutely amazing to see the amount of data gathered, insights learned and, in many cases, assumptions shattered over such a short period of time.

The teams started early at 7:30 am each day and worked late into the night.  Office hours were scheduled to be held by the teaching team in the lobby of the Ann Arbor Sheraton hotel from 9-11pm but continued until 1:30am for some.

Speed and tempo ruled the day (and night).

As I mentioned, each team presented the results of their efforts each day in front of their peers and the teaching team.  The questions were fast and probing and observations were rapidly pointed out to the group on where each team was getting stuck, making break a through or floundering.

That said, this is only week 1 of the 8-week program each of these teams “volunteered” for.  Next week the pressure will continue and the teams will again be making 10 or more customer visits to test new hypothesis and discover new insights as they continue their search for the right business model for their unique technological innovation.

I can’t wait for August!


Posted in Entrepreneurship | Tagged , , , , , , , , | Leave a comment

How would an entrepreneur apply for a job?

First of all, the title of this blog doesn’t make sense.  Entrepreneurs don’t typically apply for jobs – they create them!   That said, I wanted to use this subject to illustrate something we talk about a lot at the University of Michigan – the entrepreneurial mindset.

Too often I hear from people who are frustrated in their job search and it is amazing to me that they don’t approach getting a job in a more entrepreneurial way.

Typically, people who are looking for a new job will look at the available opportunities, identify several that look interesting and then apply through the provided application mechanism for that opportunity.  After that, they usually complain that they never hear back from the employer and then eventually move on to the next opportunity.

I’m sure that many of you who embrace an entrepreneurial way of thinking would read that last paragraph and scratch their head.  It just doesn’t make sense.

Someone with an entrepreneurial mindset would identify what type of job they believe is a good match for their passion and skillset; Select a company that appears to be the best match and then create the opportunity to join them.

How would you create an opportunity like that?  Here are some suggestions:

1)   Learn everything you can about the company.  What is their history?  What value do they provide?  Where are their challenges?  Where are they going long term?

2)   Use business networks like linkedin.com (or social networks) to connect with people who are in the company you are targeting and create a connection with them.

3)   If you can’t find someone directly connected start creating connections via the same network… if you make a good case for a connection such as “I’m very interested in your company and want to learn more” you can get a connection.

4)   If the company exhibits at a tradeshow go to that tradeshow and attend.  Meet the people, who work for the company, talk to them.  Find out how you can get involved.

5)   Find out when key executives are going to be at a trade show and walk up and say “Hi, you don’t know me but I’ll give you 10 reasons why you need to hire me!”.

Will this work 100% of the time?  Absolutely not, but that isn’t what matters.  You’ll still get rejections and it will require a lot of work but it may lead to some surprising opportunities.

What people don’t realize is that employers are looking for people who show initiative, think creatively and are passionate about the same things they are passionate about.

Employers are looking for people with an entrepreneurial mindset!


Posted in Entrepreneurship | Tagged , , , | Leave a comment

An Entrepreneurial Tsunami in A2 is Coming

Its not often scientists get to witness seismic events in our Earth’s crust that produce tidal waves.  Although our science is getting better they are still hard to measure and even harder to see up close and personal.

I, however, had the distinct pleasure of personally witnessing a seismic event in the entrepreneurial ecosystem of Ann Arbor today at MPowered’s inaugural 1000 Pitches 21e Summit event held at the University of Michigan’s TechArb facility in downtown Ann Arbor.

About 200 students and more than a dozen entrepreneurs and mentors from the A2 entrepreneurial ecosystem descended upon TechArb for the first 1000 Pitches 21e Summit event — an opportunity for finalists and participants in the 1000 Pitches Video Idea Pitch competition to network and participate in workshops to help take their ideas forward.

At first I didn’t notice the seismic shift, it was subtle.

The event itself was amazing.  Here, in the center of Ann Arbor, on a cold early December Saturday almost 200 students were attending workshops and skill building events to perfect their ideas.  Very cool!

Here’s the amazing part and why I’m sounding the Entrepreneurial Tsunami warning bell for A2…

The growth in entrepreneurial activity at UM has been significant during the last several years and over that time a pipeline of entrepreneurial activity and talent has emerged that we have embraced.   1000 Pitches and Entrepreneurship Hour, for example, are two important feeder programs for the start of this talent supply chain and contribute roughly 4,000-5000 students / year.  This fall, for example 1000 Pitches collected 3,303 video pitches… a new world record!

The seismic event I noticed was not that we had collected a new world record worth of video pitch ideas… the event was that 200 entrepreneurial students (the semi finalists and other contributors) were actively investing significant time on moving their pitched ideas forward!

Sure, many of these ideas are very raw and may not hold up through the journey but that is not the point.  The point is that the number of active entrepreneurial student engagements due to one of the largest entrepreneurial feeder programs the University of Michigan holds just shifted its conversion metrics upwards – significantly!

Its unclear how this energy and activity will materialize itself in the coming months and years but you can count on this having a tidal wave effect in follow on participation in other entrepreneurial events, classes and programs on campus.

Congratulations to the MPowered students!  Everyone else — either prepare to head for higher ground or start getting ready to scale your entrepreneurial programs… a big wave is coming!






Posted in Entrepreneurship | Tagged , , , , , , , , | Leave a comment

Observe Trends When Scaling Up Good Ideas

When I co-founded Mobile Automation in 1997 we had developed an idea (and some technology) to allow IT Administrators to send large files to mobile employees with laptops when they were away from the corporate office.

Back then, high speed Internet access outside of your office ethernet connection was very rare and the few employees who were starting to carry laptops had to depend on slow, unreliable dial-up Internet connections.  Getting large application updates or installations was very difficult and we saw a huge opportunity to fix that problem.

As we started to ponder the future direction of our company and product line we did some soul searching on what trends were happening in the industry and asked ourselves some very basic questions:

What if the speed at which mobile users could connect to the Internet increases dramatically?  If it does, what would happen to our market?  What would our target customers do?  What would our company’s value need to be in order to remain compelling?

This exercise was very helpful for us as it forced us to take our initial “good idea” and think about it in the context of time and technology always improving.

It was during this brainstorming session that we determined that two major things would most likely happen:

  1. If users could connect to the Internet at near-office-like-speeds then they would most likely be comfortable spending longer times away from the office (mobility would increase).
  2. If employees are spending longer times away from the office they will have less access to IT support resources and may have more difficulty solving problems with their laptops (remote support needs would increase).

Our basic value proposition was good for today’s environment but we knew it wouldn’t last forever.  We needed to find a way to embrace these likely changes in technology and the market.

We decided to focus on a different world than the one that existed in front of us in 1997.  We decided to assume that eventually a majority of users in any given company would be mobile a majority of the time and connecting at high speeds.  Very quickly, we decided to round out our product offering with features that would help take advantage of a more mobile work force and assist users in keeping their laptops functioning smoothly even if IT support resources were not sitting down the hall.

Ultimately, these changes proved extremely valuable as our competitors were limited in their approach and not prepared for the disruptive change in mobility that occurred in the early part of 2001-2003.

What we did wasn’t that significant to us at the time.  We simply observed where the trends were in the market and what was likely to become a reality.  Instead of fearing the future and keeping focused on the pain of today we simply observed logical trends and planned for the unavoidable.  We ended up taking a pretty good idea and helped shape it into something really great!




Posted in Entrepreneurship | Tagged , , , , , , , | Leave a comment

Why we need to unplug for 30 minutes

Last week, the homework assignment for one of my entrepreneurship classes was for each student to think about and write down what the value of the Internet is to them.

The purpose of this assignment was to teach the students the difference between describing how they use something and its true value.  As entrepreneurs, we often fail to do this and get caught up in the thing we are doing and forget to step back and recognize what the core value is of our product or service.

Additionally, I wanted the students to focus on trying to channel truly creative thinking by removing anything that might distract them.

To achieve this, I added to the assignment the following parameters:

After you write down your initial thoughts on the value of the Internet you must then unplug completely for 30 minutes and reflect on this further.  Walk away from your phone, iPod, computer and TV and sit somewhere and reflect.  Then, after 30 minutes are up come back to your original notes and modify them with what you have thought about.

The results were…. surprising.

These students did a great job, as I expected, in identifying the value of the Internet to them and wrote excellent insights to how it has helped shape their thinking, extended their knowledge and connect them to others.

What was surprising, however, was how difficult they felt it was to unplug for 30 minutes!

Many wrote about being hesitant to walk away from their smart phones and in some cases had their room mates take them away physically and hide them.  Some could not sit still and started tidying up their rooms and pacing.  One student couldn’t do it and decide to give up on the assignment all together.

After about 10-15 minutes many students wrote about a growing sense of themselves falling behind the rest of the world and not knowing what was happening and how stressful this made them feel. (amazing, eh?  yes, this was only a 30 minute activity).

During the final 10-15 minutes a lot of the students started getting into deeper thoughts about their assignment and managed to develop some very strong and meaningful insights.  Many also started to identify a little sadness or longing for times when life wasn’t so busy and they could read a book for fun, play cards or enjoy simpler things.

I couldn’t agree more.

We all are moving extremely fast in this busy world trying to pack just a few more things into our day and accomplish just one more task (or respond to just one more email).  This leaves very little time for truly creative and deep thinking and without that reflective time I believe we will miss some truly amazing and disruptive ideas.

I think we all could benefiting from unplugging for 30 minutes… don’t you?




Posted in Entrepreneurship | Tagged , , , , , , , | 2 Comments

Chance Favors the Connected Mind

Great progress has been made in developing processes and tools to help entrepreneurs take an idea and search for the right business model and turn it into a new venture.

Not a lot, however, has been done to develop processes around taking an interesting idea and evolving it into something truly amazing and disruptive.

Imposible?  No.  You first need to look at where good ideas come from… Steven Johnson has done a lot of work on this topic and has a great video about it here.

My favorite quote from Steven comes at the end of his video … “Chance favors the connected mind”.

At the University of Michigan we have a tremendous opportunity to generate really good ideas given the deep research, faculty expertise and amazing student talent.  The challenge, as one would expect, is to create opportunities to connect people and ideas in ways that generate truly disruptive and great ideas.

At the Center for Entrepreneurship we are experimenting with ways to develop a process that is efficient at doing just this.  Many of our programs at the Center are designed to include opportunities for connections to be made and ideas to ignite.

Ultimately, I see these experiments turning into accepted processes that can help connect, create and generate truly disruptive ideas.  I’ve never been a fan of leaving things up to “chance”.



Posted in Entrepreneurship | Tagged , , , , , , , , , | Leave a comment

Testing Ideas with Customers

I’ve sat through approximately 50 pitches in the last 2-3 weeks and many times I hear a common example of how the teams have tested their ideas with customers…

“We went out and showed our prototype to a bunch of people and everyone we showed it to said yes, they would buy it!”.

The problem is that is not validation.

First of all, people like to be nice to other people.  Its human nature.  People will smile and say your idea is great but honestly it doesn’t prove anything.

Secondly, people may say “they like something” but it doesn’t mean that they are necessarily willing to pay cash for something.

Lastly, this is the wrong question to ask.

When you are testing your ideas with potential customers the first thing you need to do is ask them what their challenges are and why.  There is a whole discussion that needs to take place to get inside their heads.

If you are working on a new venture and interested in gathering some customer data start by just having a simple conversation with them about what they are doing and why.  You’ll be surprised at what you will learn!



Posted in Entrepreneurship | Tagged , , , , , , , , , , | Leave a comment