In the summer of 2016, Elon Musk, CEO of electric-car maker Tesla, unveiled his vision of the future, called “Master Plan, Part Deux.”
Not content to just concentrate on building a sexy, safe, and desirous electric car, Musk already had a lot on his plate: building a massive electric battery plant in Nevada, buying the solar-panel company SolarCity and, oh by the way, running SpaceX, the rocket-launch company. In his master plan, Musk set his sights on developing electric-powered trucks, autonomous buses and a ride-sharing program.
Musk, a true entrepreneurial visionary, is a prime example of the type of entrepreneur I call a “challenge junkie.” When looking at what motivates entrepreneurs, I’ve identified the “Four C’s.” Challenge, cash, creativity, control. Typically, challenge beats out all the others (yes, even cash…).
Download “The Four Cs” worksheet for your class, excerpted from our new 2nd edition of Entrepreneurship: A Real-World Approach
Why? Entrepreneurs often get their business ideas by seeing a problem: a need that isn’t being met, an existing product or service done poorly. That’s the challenge they want to solve (and make money, too).
But here’s the rub, and where many entrepreneurs and small-business owners go wrong. Once the challenge has been met, they lose motivation. They’re not really interested in the day-to-day details of execution. Shipping? Personnel? Managing a website? Boring.
In fact, in running their own future businesses, your students may become challenge junkies like Elon Musk. They may look for the next challenge rather than execute a vision they’ve already started.
“Build one business at a time.” That was one of “Kleiner’s Laws” from legendary venture capitalist Eugene Kleiner, founder of Kleiner Perkins Caufield Byers, who helped create some of America’s greatest companies. He warned entrepreneurs about distractions. Your students should take note.
- They only have so much time. Everyone — even Elon Musk — only has 24 hours in a day. No matter how smart your students are or how little they sleep, that’s an immutable fact. Even if they’re amazing at delegating with the ability to attract great people, only they can make many of the decisions and deals at their future companies. And they still have to answer their key people’s emails.
- They only have so much attention. To build a truly great company, they need to give it more than 25% or 50% or 75% of their attention — it takes 110%. That’s why founders and key employees in start-ups often have trouble maintaining family and personal relationships. Even while running a small business, they have to keep their focus, and trying to build too many products, too many services, too many distribution channels can keep them from success.
- They only have so much money. Tesla may have hundreds of millions of dollars, but even its investors get restless. Small businesses and start-ups have far more limited funds. If your entrepreneur-students spread their financial resources too thin, they run out of the funds they need to make their vision a reality.
- Others have only so much patience. People want to see results. Whether it’s investors, customers, employees or your students’ families, after a while, even their staunchest supporters want to know that they can deliver what they promise, can make their vision a reality.
To be sure, Musk’s challenge may be much more important and pressing than an entrepreneur trying to create the next social media app. He’s driven to create an ecosystem of sustainable energy to combat climate change.
But right now, Tesla has 400,000 reservations for its $35,000 Model 3 electric car, due out this year. Delivering on those, building a hugely successful Tesla may be the most important thing Musk can accomplish to help achieve his vision of a future built on renewable energy.
As a challenge junkie, Musk needs to reframe his challenge. His challenge is to build a great electric car company, not just a great car.
Your students, too, if they become entrepreneurial challenge junkies, will need to reframe their task: It’s not enough to just create a product or service to solve a problem; challenge them to build a great, sustainable company.