Desh Deshpande is speaking to the Founder’s Journey class at MIT and I am blogging live. He is being interviewed by Prof. Tom Magnanti who was Dean of Engineering at MIT until 2007. He is one of 14 faculty members to carry the title "Institute Professor", the highest honor that MIT can offer. It was under Prof. Magnanti’s leadership as Dean that Desh Despande was inspired to create MIT's Deshpande Center for Technological Innovation. Many people, after being named Institute Professor and after retiring as Dean, would take a break and rest. Not Tom Magnanti. He has just taken on the task of creating a new university in Singapore, described in this press release:
With two of the most respected people at MIT on the stage before me, we are in for an incredible evening densely packed with pearls of wisdom.
The conversation kicked off with “when do you know you should persevere, and when to give up?”. The class came up with lots of interesting suggestions, including “if it’s VC money, keep on spending, if it’s personal debt, quit!” :D
Desh’s advice on this topic was as follows:
- Distinguish between what you can control and what you cannot control
- Trust your gut
- Set milestones and timelines: when you don’t meet a milestone or the expected results aren’t there, read the writing on the wall and move on.
On the topic of tensions between entrepreneurs and VCs, Desh made the following points:
- It’s not possible to achieve a big vision purely through bootstrapping. VC money is necessary.
- If the entrepreneur hits every milestone as promised, VCs will respect the entrepreneur both for their ability to set realistic milestones as well as their ability to execute.
On how he got into entrepreneurship after a PhD:
Met Peter Brackett who was working on a start-up. Joined him at his invitation. The start-up was acquired by Motorola soon after. The business eventually grew to 100s of millions of dollars. If he could do this for Motorola, why not independently? Thus the seed of entrepreneurship was sowed.
Tom Magnanti is doing a fantastic job of guiding the conversation, and seems to be a natural at this. He’s asking all the questions that are on the top of the audience’s minds as we hear Desh speak.
On the topic of luck in entrepreneurial success:
- Analogy of kids playing soccer. The kids have fun kicking the ball around. Parents get upset because the kids are not kicking the ball a certain way. Entrepreneurship is like that. When you are having fun doing what you do and are passionate about it, you will play to have fun. How many goals you shoot is a bit dependent on luck. Chances of having a huge exit as an entrepreneur is like shooting a goal. If you are not playing for the fun of it, you are going to be very unhappy like the parents who are onlookers.
How to identify big ideas:
- Big ideas are the usually the result of a shift in the market. They are very simple ideas in hind sight.
- Pick a small simple idea that’s easy to bootstrap. The bootstrapping allows for much easier course correction. Once you build credibility by tackling the simple problems successfully, you will be better prepared to tackle the big problems.
On how to build the ideal team:
- Once you get a few good people, it snowballs
- Develop an eye for good people; learn to see each individual’s strengths
- Best people to hire are the people who have the potential but haven’t achieved the peak yet
- When you hire people, you never know whether they are going to work out or not. If you made a mistake, fire them quickly.
If you make a mistake, admitting to a mistake and correcting it as a very important trait.
Qualities of an entrepreneur:
- Wildly optimistic
- Don’t get hung up on why the world is fair/unfair.
- The mentality that “I am giving up so much to play this game” - the sacrificing mentality, instead of “I love playing this game!” is fatal. An entrepreneur should do it for the opportunity and fun of doing it, instead of getting hung up on the outcome.
Entrepreneurship is about taking the leap to jump in and solve a problem. Don’t get hung up on whether you’re rewarded for it or not. Judge the quality of an opportunity by assessing the ability to make a difference. Make a bigger difference in whatever you do. You will be the CEO of your life, your family, your career - cultivating this attitude will make a difference.
Prof. Magnanti just wrapped up the conversation by asking the audience to call out the key lessons they took away from the conversation. It’s clear that the audience recognizes the privilege they have been offered, and between the 75 odd people in the room, the lessons get cemented into memory and is capped off by thundering applause.