Scott H Young

Guy Kawasaki has an interesting formula to value a start-up: “For every full-time engineer, add $500 000.  For every full-time MBA, subtract $250 000.” The statement raises an interesting point, do the highly analytical skills offered through an MBA actually hinder the creative process needed for entrepreneurship?

And an even broader question: does reading about something make you worse at actually doing it?

I can’t say how having an MBA impacts your entrepreneurial ability.  I believe it would depend more on your goals and personality than your education.  But I think the broader question is worth a good look.  Analysis and action are two completely different things, and I think there are circumstances where learning too much can actually hurt you.

From Boxless Thinking to Doctrine

When you have few opinions about a subject, you also don’t have any wrong opinions.  The fresh perspective of a beginner does have an advantage: it doesn’t come with the baggage of bad advice.

Rob Warren, a professor I have for an entrepreneurship class, made an off-hand comment that our studying probably hinders our ability to be great entrepreneurs.  “You come in here with an open perspective, and we push you into a narrower set of thinking.”

Some areas of life, theoretical knowledge is extremely useful.  I’d rather trust an electrical engineer’s description of how a circuit board works than my own assumptions based on using electricity.  These tend to be areas of life that are highly general, and where obtaining a large enough set of experiences is difficult.  Science usually fits both of these criteria.

But there are some areas where experience trumps theories.  I’d rather listen to my own experiences running a business, than an MBA student who has never worked in my industry.  This is because what works for me might not work for you, randomness is everywhere and ideas are often too complicated to put into a big theory.

In the latter case, spending a lot of time learning theories, without practical experience can be deadly.  Why?  Because for every nine or ten correct ideas you learn, you pick up one or two false ones.  They may not be false for everyone, but in your case they are dead wrong.

At first glance, this may not seem like a problem.  One error for every several pieces of good advice isn’t that bad.  However, any programmer will tell you that if you introduce one bug for every 10 lines of code, you shouldn’t be allowed near a computer.  It’s far harder to unlearn a wrong idea than it is to learn one.

    One Book per One Hundred Hours of Practice

I think there is a way you can prevent this: always have your experience match your reading.  That is,  you should have roughly one hundred hours of real experience for every book you read on the topic.

This is a completely made-up rule, but I think the numbers are in the right ballpark.

Keeping theory balanced with experience keeps you from introducing buggy ideas into your brain.  I do enough writing that when I see a bad idea about writing style, I can safely ignore it.  Even if I didn’t ignore it, the idea would quickly reveal flaws when I started practicing it in my writing.  I’m far from the best writer, but I do get a lot of practice.

What does this rule apply to?  Anything that fits the second category of skill I mentioned earlier: where experience trumps theory.  The more specific, subjective, random and complex the topic, the less useful theories are.  Here are a few that would make my list:

• Writing
• Entrepreneurship
• Design
• Music
• Dating
• Self-Improvement
• Leadership
• Productivity

There are also even more areas that fall in the gray zone between science and intuition.  Exercising has some simple and highly general rules that should be followed.  However, building the discipline to exercise regularly and enjoy it is highly specific and needs experience.  Most of life is a bit of both.

Should You Read Less?

Unless you spend 15 hours of your day locked in your room reading, I’d say the answer is no.  Most people don’t read enough, not too much.  Change what you read, not the volume.  Even for creative fields, books can be useful, as long as they are matched with some real-world insights.

If you read a lot about a topic, but aren’t spending at least 3x that much time actually practicing it, you should stop reading that topic.  If you’re spending three hours a day reading dating advice columns on the internet, you should be spending at least nine hours a day meeting people to justify that.  If you’re library is filled with self-help books, but you haven’t written down any goals and invested several hours a week to accomplish them, you need to stop buying more of those books.

Reading also can make you feel like you’re making improvements.  However, unless it’s applied intelligently, it’s just procrastinating.  Nothing is stopping you from meeting people, starting a business, writing a short story, building software, networking or setting goals, don’t let books and blogs get in the way.

Almost everyone is an artist.  If you create something original, you’re an artist.  Whether that medium is music or software, it doesn’t matter.  A big question for a creator of any kind is whether to keep a passion as a hobby, or try to use it to make an income.

It didn’t used to be this way.  There was a clear dividing line between hobbies and work.  Technology has made it possible for small-time artists to blur this line.  Bloggers, amateur designers and basement programmers have been able to make a decent living pursuing a hobby, the question is: should you do it?

It’s Your Choice

I’m not going to discuss the problem of whether artists should be allowed to make money off their work.  I think the answer is a definite yes.  Anyone who has spent hundreds of hours working on a project can attest that money certainly isn’t everything, or even the most important thing.  However, by putting in all of that work, you should be able to choose your reward for success, whether it is money, praise or change in the world.

Ultimately, the decision to go pro needs to be made on an individual basis.  Some people can really enjoy turning a pastime into a business.  For other people, it will just be an overhead nightmare, sucking the joy out of an activity you once loved.

Making Money and Creating Art Aren’t The Same Thing

Typically, successful independent software developers don’t spend most their time developing software.  Profitable developers often spend only about 30-40% of their time actually writing code.  Some of the most successful developers spend less than 10%.  For this website, only about 30% of my time is spent writing.

As soon as you start trying to make money, you introduce overhead.  I’ve found that the most successful micro-entrepreneurs, spend the largest chunk of their time on marketing.  Generally, you don’t spend time on marketing if you aren’t trying to make money.

If you don’t like the business activities, don’t try to make money.  With few exceptions, making money isn’t just a process you can slap onto a hobby.  It takes serious consideration, and often occupies more of your time than the actual creating.

The flip side of this is, of course, by turning a hobby into a money maker, you might be able to quit your job.  This can end up giving you more time to create because, while you’ve added overhead, the extra income means you don’t need to spend time working somewhere else.

I enjoy doing the overhead work and business-creation at least as much as I enjoy writing.  But this is my preference, not everyone’s.

Money Can Kill The Joy

I stopped freelance writing in August.  Although I enjoyed writing for direct payment more than any other job I’ve had, it wasn’t as fun as writing for free, or writing for this website.  I enjoy writing a lot more when I know that I’m not going to be paid a cent for finishing an article or book.

When you directly exchange your time or efforts for money, it’s easy to lose some of the joy.  Now, instead of being a fun, voluntary activity, it becomes work.  I’ve found that working indirectly for money by building a business (instead of per article or per deliverable) helps this problem.

Some Hobbies Aren’t Good for Making Money

Just because you like your paintings, that doesn’t mean people want to buy them.  A hard lesson to learn for any micro-entrepreneur is that people don’t want what you’re selling.  If your reason to go pro is the dream of watching thousand dollar payments roll in while you sit back and relax, stop fantasizing.

Why Making Money is Good

I’ve just presented a few arguments for why any amateurs should think hard before starting to earn money.  But, there are also many reasons to go pro other than greed.

More Professional Projects

When you’re limited to your own volunteer activities, and the help of whoever you can trick into working for free, you’re weaknesses will always show up in the final result.  If you’re a great programmer, but lousy interface designer, your software will be hard to use.

Earning money from a project can give you the resources to make it better.  Instead of having to do everything yourself, you can focus on your strengths and hire people to do what you can’t.  Revenues can allow you to improve what you have to offer to the world.

Work on a Bigger Challenge

Earning money gives a very specific, measurable goal.  When your goal is more abstract, it can be harder to focus on it.  Earning money for me is a huge motivator, not because I really desire the extra cash, but because it turns a vague, open-ended task into a concrete and challenging goal.

Quit Your Day Job

I’ve never understood how some people live double-lives.  They spend the majority of their day working jobs they either tolerate or actively dislike, to spend their off-hours working on satisfying projects to give away for free.  There are valid reasons for this, and I mentioned a few of them above.

However, why does their need to be a split?  Why should the activity that gives you meaning and passion in life be separated off from the activity that earns you money.  It would be like eating all your food in two different meals: one which has no nutrients, but flavor and another that fills you up, but tastes like cardboard.

All or Nothing

I’m of the opinion that pursuits to earn money should be an all-or-nothing approach.  Either you keep it an amateur effort, free of overhead and customer service, or you work to build it into something meaningful.  There are two big reasons for this:

Most micro-businesses take a lot of work to reach decent income levels.  I probably earn about $50 per hour based on my monthly income and earnings per month (although it varies considerably).  When I started, it was probably about $0.04 per hour.  Although you don’t need to start at such a low level, exponential scaling is important.  Putting in half the effort might only give a tenth of the results.

Second, the potentially corrupting factors of money occur no matter how much is involved.  Hobbies become work whether you’re paid $0.10 per hour or $1000.  The business overhead of earning money tends to be all-or-nothing.

What are your thoughts: make money or keep it a hobby?