Heart, Smart, Guts, and Luck

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The Heart of a Business

An Excerpt from the Book

Of our four business-building traits of Heart, Smarts, Guts, and Luck, the Heart is perhaps the most challenging to define. To both new and experienced business-builders, the Heart risks coming across as ephemeral and soft. Which is ironic, as it may be the most critical and distinguishing feature of people who have successfully started companies. Three things characterize the Heart-driven individual:
  1. Purpose (and the passion that comes with it):
    You cannot plan to have Heart, a company’s foundation lies in its authentic purpose. The great Heart-driven entrepreneurs drive their decision-making and leadership style from a central purpose. For them, as a colleague correctly describes, purpose comes before product and profit.
  2. Sacrifice and agape:
    The maternal-like sacrifice that comes with creating and building a business – this is what the Greeks called agape. Most of us are familiar with the first two types of love described in ancient Greek times – philia is fraternal love as in Philadelphia and eros speaks to lust and eroticism. But agape speaks to the love of sacrifice that is evident amongst Heart-driven individuals.
  3. Nuance:
    The third dimension of Heart lies in nuance. The subtleties and thousand points of light that emanate and coalesce to ultimately differentiate a business from its competitors are never obvious but yet so clearly felt. It is only with Heart that one can realize the full potential and power of nuance. There are stages in a business life-cycle or function where sweating the details is actually worth it.

Heart is perhaps most evident in small and medium-sized businesses. These people and their businesses form the backbone of American commerce and entrepreneurship. It is because of the Heart that instigates these ideas from a source of authentic passion that these small businesses can become large and successful. In our research it was discovered that of the people that had an opportunity to exit their businesses, 70 percent did not start with a formal business plan. Think about that – a majority of our business owners and operators who had experienced success started with something inside of themselves rather than something on paper. Despite what the B-school’s say, a business plan as important as it is eventually is, is not the most important thing to launch a business.

Consider people like Doris Christopher, the founder of Pampered Chef, who created the modern-day equivalent of concept of a “Tupperware” party for kitchen goods (and then sold a large majority of her business to Warren Buffet), or Sara Blakely of Spanx who invented a new category of women’s apparel (a 20th century girdle and undergarment business that now is estimated to be worth more than $1B), and then there is another one of Buffett’s favorite case studies—Rose Blumkin, the founder of Nebraska Furniture Mart, who started her business with a $500 loan and the motto “Sell Cheap and Tell the Truth.” Each of these founders brought – and continues to bring today - a passion, purpose, and a deep love affair to their enterprises.

The drive, movement, and contagiousness of a business derive from its purpose and passion, which are typically a reflection of the founder’s Heart. Before doing anything else, at the onset of company creation, founders need to generate widespread energy and inspiration. You want people who can start by leading with Heart, before they manage too early with their Smarts.

Mark Dwight is the founder of Rickshaw Bags in San Francisco – a made in the USA messenger bag company. Take a tour of Mark’s facility in San Francisco and you cannot help but get energized by his enthusiasm and pride for artisanal craftsmanship. He speaks of his Rickshaw bags as creations with personalities, as individual hand-crafted works that will live on to have a personal relationship with the eventual owner. See his video at www.hsgl.com.

As Tsun-Yan our colleague and co-author says, Heart, and its quality of agape, mean simply that we care enough to put aside other things to devote ourselves indefinitely to our dream. Nothing motivates us more, or compels us to work harder, than a compelling or infectious idea. In our experience, few individuals wish to disrupt the status quo, whereas the greatest business-builders want nothing more than to bust open whatever ceilings stand in their way. Heart drives both distance—the endurance and hard work over time that success requires—as well as those bursts of productivity, which we dub height. Heart, and the hard work it requires, is thus characteristic of both the marathoner and the sprinter, often within the same race. If we approach an idea or business with Heart, hard work not only becomes tolerable, it turns into a fierce exercise in headlong joy.

In the case of one of our venture firm’s own portfolio investments—Epic Burger, a natural burger chain—we have watched over the years as founder David Friedman maniacally focused on the smallest details and nuances, his goal being to create the most perfect and “mindful” burger in the world. How might the bun-to-meat ratio (in terms of size) improve? Which pickles, and in what shape and size, delivered the optimal “flavor profile” for his burger? Which potato gave the best flavor for the hand-cut fries, and did they complement the taste of the burger? What kind of ketchup? What kind of salt? How should the environment enhance the food experience; what décor should be changed? Should he alter the line locations to speed up order taking? Should he add another register? What about the menu design? Could it be made simpler? The list goes on. For any entity that has its eye on large-scale success, perfecting the offering at the smallest level first before scaling is critical.

Founders—the Ultimate Torchbearers of Heart

Of all the different types and stages of business-builders, it comes as no surprise to learn that founders are the most Heart-driven people out there. It doesn’t take long to figure out who might be a great entrepreneurial founder. You know a true founder when you see it. (In fact, you feel it.) Entrepreneurial ardor—the fire in the belly—is both exhilarating and contagious. Founders are highly biased toward being Heart-dominant, and at the core of Heart-driven individuals is deep passion. By extension, high-Heart individuals tend to be most fired up either at the start of businesses or at restart points (i.e., when growth has stalled). Fueled by purpose and hunger, founders with strong Heart characteristics are compelled not only to build a business but to share their mission and vision with the rest of the world.

Some years ago, a short clip of Kevin Spacey from the television series Inside the Actors Studio went viral. Speaking to host James Lipton, the actor said, “There is no prize out there. The only prize is this one—what you feel and what you accomplish. To be ambitious and to want to be successful is not enough. That is just desire. To know what you want, to understand why you are doing it, to dedicate every breath in your body to achieve—if you feel you have something to give, if you feel that your particular talent is worth developing and is worth caring for, then there is nothing you can’t achieve.”

It is perhaps one of the best summaries that we have seen of the meaning of Heart.

Whether you are an artisan seeking to perfect a craft, a musician working toward capturing every note’s nuance, an athlete dedicated to an intense daily training regimen, a founding team member building a business from the ground up, or an executive leader engaged in corporate business-building, unless you inject and impose a higher sense of purpose, your efforts will lack soul and be less likely to succeed. Purpose and passion are the foundations of Heart, and in some respects, the foundation of a business.

With purpose, Heart is persevering and passionate; it gives out and back to the world. To have purpose means giving individuals a product or service that is worth caring for and that has a clear why, or reason for being. As we have said, purpose need not be overly lofty or social, but should instead focus on being clear and reflective of underlying values. And while money will often flow to a business that delivers on its purpose, the purpose has to be something other than “making money.” Among the purpose-driven questions we like are: How might this make for happier consumers? More engaged learners? Smarter diets? Better decision making?

To trust what you are feeling, to know it makes up the real Heart of you and your business, you need an unbreakable connection and consistency between what you do and your underlying principles and values. Ask yourself, how strong is the linkage between your behavior and your values? Doing what we say and saying what we do, and basing both on our principles and beliefs, creates a confidence and trust that is the greatest leverage for improved leadership, impact, and business-building potential.

If you watched one hundred Hollywood films in a row, you would be left with a recurrent theme: Follow your heart. Heart has become more or less synonymous with fuzzy goal-seeking and perceived to be absent of rigor or critical intelligence. But from our perspective, Heart is anything but indistinct. Its three identifiable and defining characteristics—purpose with passion, sacrifice, and nuance—are unmistakable. In a skeptical era, many of us are wary of “believing” headlong in anything. Which is yet another reason why entrepreneurs and businesses with an authentic Heart have increased impact and possibility in the way we see and live in this world.

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