Lesson 57: Respect
When I was in high school, I had excellent English teachers. On the first day of class, the syllabus would outline the papers we would write. However, I did not like writing. I felt confident on math and science assignments, but writing felt daunting and unappealing. I grew to respect writing my senior year when we were assigned a personal narrative. It was a breakthrough moment because I used my personal narrative to write my applications to college. My respect for writing grew because I saw the value it created in my life as I aimed for higher education.
As I aim to acquire a small business, I must respect each point in the process: 1) Fundraising 2) Search and Acquisition 3) Operation 4) Exit. I feel confident about steps 1,2, and 4 because of my background in finance, but step 3 is my largest area of growth; I have never worked in operations. Operating a business is all about creating value so the company is worth more than when you acquired it.
The chief responsibility of the entrepreneur is to create value in the business. Brian Wolfe and his colleagues discuss this in their paper, “What Exactly Search Fund Investors Do—and Don’t Do—for Entrepreneurs.” They point out most investors offer their capital, network, and advice over the lifetime of the investment. They then point out, “Entrepreneurs are compensated to fully engage in operations through their annual salary, bonus, and a third of their equity rewards.” My incentive to sharpen my skills for operations (or gain some in the first place) are clear. Thankfully, I am enrolled in business school where we are surrounded by resources to close our skills gaps.
My values are to act with love, humility, and wisdom. It is wise for me to address my skills gap while I have the opportunity. I am taking a course called Operations Management: Business Process Fundamentals which will school me in the skills I need to create value in a business. At first I felt operations was daunting and possibly unappealing, but similar to writing, I see this is where you create true value as an entrepreneur. I plan to acquire a trade school, where I want students to respect even the skills that seem intimidating or unappealing to learn. We all have something we want to accomplish and seeing the value of each step helps us respect the process.
This is Lesson 57: Respect. Next week is Lesson 58: Patterns.
P.S. I realize the irony in my reluctance to write given that I write this newsletter, but I respect the skill of communication and want to improve.
