The Importance of Hope (or, Barack Obama on Entrepreneurship)

March 1st, 2008

Alternative title for this post: Barack Obama explains the difference between entrepreneurs in the US and Canada.

Dave, my brother, asked me the following question the other day: what’s the biggest difference between entrepreneurs you’ve met in Canada and entrepreneurs you’ve met in the States?

My intial response - “one’s the majors the other’s the minors” - left me unsatisfied. That explanation covers entrepreneurship but fails to explain entrepreneurs.

The biggest difference in entrepreneurs?

The answer lies with Barack.

Recently I was talking to an old friend. The US election, a favourite topic of mine, came up. I asked her how the US could put its faith in a man who’s running predominantly on a platform of hope and change for the future. The answer, so simple and clear, is still ringing my head: “only when a nation shares a collective hope can real change occur.”

Which brings us back to the biggest difference between entrepreneurs in Canada and the US:

Entrepreneurs in the States have a level of hope that’s unmatched in Canada. They dream bigger. Visions and ideas are bolder.

When your aspirations are on an entirely different level, so too are the things that you realize.

This is, of course, a product of the constraints imposed by the differing start-up ecosystems in the two countries and not a comment about entrepreneurs themselves (ask my friend Leigh for her story of dreaming beyond the Canadian start-up ecosystem; talk to David about the challenges that exist in simply getting the deal done).

There are great entrepreneurs in both countries. The difference in the magnitude of their dreams is explained by turning to The Stockdale Paradox, which is outlined in Jim Collins’ book Good to Great: “You must never confuse faith that you will prevail in the end — which you can never afford to lose — with the discipline to confront the most brutal facts of your current reality, whatever they might be.”

The US start-up ecosystem supports bolder dreams and faced with this fact US entrepreneurs dream bigger than their Canadian counterparts.

When your aspirations are on an entirely different level, so too are the things that you realize.

Viewing 13 Comments

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    I've read your post through several times now, and I've concluded you cannot extrapolate from the politics of Barack Obama and then draw conclusions about free enterprise in the US. You start with at least one completely erroneous statement: "... how the US could put its faith in a man who’s running predominantly on a platform of hope and change for the future." At best, and at the present, only a quarter of the US is putting its faith in Senator Obama. Another quarter is counting on Senator Clinton. And about half believes that neither is best for this country. That is hardly a resounding endorsement of either the man or his beliefs. You then state, "Entrepreneurs in the States have a level of hope that’s unmatched in Canada. They dream bigger. Visions and ideas are bolder." I sincerely doubt this is true. It is human nature to hope and dream, regardless of where you live or what your background is. I would argue the primary difference here is the ability to act on those hopes and dreams. Access to capital is probably a more important consideration in realizing entrepreneurial dreams. (Well, that and strong trademark and copyright laws.) And ironically, at least in the context of your post, Senator Obama is proposing to make access to capital far more restrictive. Not much hope there for future dreamers. Hoping and dreaming only gets you so far. The freedom to act on those hopes and dreams is what's important. I'm confident that as long as free enterprise continues to be the standard by which we pursue our goals, the US will continue to be the place to accomplish them, politics notwithstanding.
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    @ Interested Observ... I think when Fraser asks "how could the US put it's failth" he's asking a forward looking question akin to "why would they elect him on that platform?". He's clearly not stating that the entire US population supports him... an impossibility in a democratic society. It gets off the point, but your statement that "...only a quarter of the US is putting its faith in Senator Obama.." is rather misleading given that those numbers would jump to 50% (for arguments sake) if Clinton drops out of the race. That being said, I'm not convinced either as to the validity of the rest of Fraser's comments. I don't see the applicability of the Stockdale Paradox, which speaks of holding tight to the inevitability of success in the face of overwhelming obstacles, to the size of an entrepreneur's dream. The line he’s tried to draw between entrepreneurship and entrepreneurs feels artificial. I'm still partial to the Majors / Minors analogy. It can be “chicken and egg”, but which came first is now moot. The US has achieved a critical mass of entrepreneurs, which attracts further funding, which attracts entrepreneurs (internationally) and enables entrepreneurs (domestically), etc.
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    Thanks for reading through the post a few times. I think you should read through it a few more though.
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    @Ken, thanks for clearing up a few things for Interested Observer. The Stockdale Paradox is all about maintaining faith that you'll ultimately succeed while remaining grounded in the facts/reality. For Canadian entrepreneurs the biggest fact/reality (that is: constraint) is that the start-up ecosystem in Canada can only support certain types and sizes of start-ups. Great Canadian entrepreneurs realize this and dream accordingly. This is why I make the differentiation between entrepreneurship and entrepreneurs. Entrepreneurs in both countries are equally talented. The US system simply allows for (supports? enables?) grander entrepreneurship and thus the unbalance.
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    majors and minors is probably the most accurate way of describing it (although that would send some Canadians reeling...). everyone of course has grand hopes/aspirations, but realizing them is very dependent on environment or country, so it becomes a semantics debate about when hopes meet reality. Dr. Barber wrote a great paper studying this, "In the Greenhouse", where he interviewed CEOs of Canada's growth companies. The results, "many plan to sell or expect to be bought before reaching $300 million per year", and few growth companies expect to remain in Canada. Most actually plan on selling before reaching large scale. (http://www.impactg.com/index.php?descript=Publica... you can have all the hopes to make it to the big leagues, but if you actually want to play, it is worth noting the Expos now play in DC.
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    DK, don't you think that Dr. Barber's findings reinforce the thought that Canadian entrepreneurs adjust their hopes and dreams based on the realities faced in Canada? Surely their unconstrained aspirations are to build companies beyond $300M / year or to build a growth business that isn't purchased by a US firm.
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    "Unmatched in Canada" Have you ever been to Waterloo, Ontario? It's chilling the entrepreneurial spirit in this town. It's the town that started RIM, and only two blocks away from RIM and my house, another chart topping growth story, Sandvine. It's one reason I moved here. Surely you haven't been to every city in Canada, nor every city in the US. Per capita, entrepreneurial spirit has to be a a function of the education, wealth, resources, and many more factors, which are as diverse as the local subsets then just country. If you wanted to say New Yorkers dream bigger than Floridians, that argument might stand (Of course, I have no idea), but you're blatantly walking around with your eyes closed if you attempt to stereotype two countries as diverse as Canada & the US. I hope you don't mind, a random reader disagreeing. All the best to you Fraser, and thanks for sharing your opinion with the blog-go-sphere.
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    Hi McLarty, thanks for stopping by and commenting. Always great to have a fellow Canadian entrepreneur share some thoughts. I think it's easy to stereotype the entrepreneurial spirit that exists between the two countries. In fact, the difference between the stereotypes is a pressing issue. One that's regularly discussed in parliament, covered in the press, and articulated at start-up conferences throughout the country. I am very familiar with Waterloo - I was born and raised in Hamilton and worked for a early-stage investment firm in the Golden Horseshoe area before making the move to NYC. We worked with a number of entities in the K-W region and they're building a wonderful start-up community. Certainly UW, Communitech and other organizations are providing terrific support to the ecosystem within the region. And you definitely reference the major start-up success story (RIM) and there are other (less successful stories), such as Open Text, that exist. But isn't it saying something when there's a single success story that we can reference? I think that's telling.
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    You (Ken) said, much more clearly and concisely, what I tried, or wanted, to say. The line between the politics of any one politician and entrepreneurship is very obscure indeed. I agree, after this coming Tuesday, the Democratic primary may well be decided and the 25% percentage I mentioned will be 50%. Still, Fraser tried to apply a very single-minded approach (even if it is as simplistic as "hope") to the mindset of millions of people (entrepreneurs). It simply doesn't work in any context. The major/minors analogy is far more relevant to both entrepreneurs and entrepreneurship, and is more applicable to a large population of people. Think players and teams. The players have their own approach to success, while the teams or management have a separate one. Neither is completely separate from the other, but both have a common goal. A final note to Fraser: reading through your post a few more times doesn't help. We'll have to agree to disagree here.
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    Reading through what I wrote doesn't make sense in a major/minors context. But the point is, there is a collective approach to success and an individual approach to success. Neither have to be mutually exclusive. And both require more than just hoping it will happen.
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    I think you have to count Sandvine, as the second success story to come from Waterloo. The company took sales from $500K 13 quarters ago to >$20M per quarter, and they show no signs of stopping. They almost hit $1B market cap last summer. (SVC.TO) Anyway...I'm proud to be part of Waterloo and realize there is a lack of shine in other geographic regions of the country. I guess I'm geographically the metaphoric smart blonde lumped in with other people who maybe (or maybe not) have earned a less positive stereotype. I just have to believe Waterloo does a good job of coming close to "matching", per capita at least. I mean, it's a town of ~100,000. That is, if success x entrepreneurial spirit had a unit of measure, that could be divided per capita, hopefully you can see where I'm coming from. I love good blog debates... BTW...I knew you were from Hamilton, I forget how I knew that...so it confused me when you wanted to stereotype all of Canada. -Jeff M
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    I'm proud to be Canadian. I wear my love for Hamilton on my sleeve. I'm thrilled with the changes that are occurring in the city, the province, and the country that will create real impact on entrepreneurship for years to come. That's future tense though. We're not there yet. But we're on the right path. Growing a company with $20M revenue is tough. Growing from $20 - $100 is even more difficult. But the hardest is to continue to grow beyond $100M / year in revenue. It will be interesting to watch Sandvine over the coming year - they're at a difficult junction for any company. And a junction, that unfortunately, Canadian companies have never been good at transcending. For all it's entrepreneurial spirit Waterloo has not matched the output of other areas. Again, I believe this will change thanks to the foundation and support networks that many have built in the region.
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    Had to check the website ... an interesting and spirited discussion happening on Disruptive Thoughts? Who woulda thunk it. :) @McLarty Actually I am a Wunderloo alumni (waaaay back 2 decades ago) and I do follow the great things that are happening there (my retirement account thanks you RIM!). I think that it is in part the support that Communitech provides that enables / attracts entrepreneurs in the area. Prior successes facilitate future successes. It is the reason that the group I work with are committed to nurturing innovated ideas in our region. We feel it will lead to a stronger, more fertile breeding ground for additional new ideas. This area could be a recognized "team" in the "big leagues" @Fraser I'd offer that entrepreneurial spirit is taking an idea and growing it to say $20M revenue, not the process of scaling it beyond. Being bought should be an entrepreneur's goal... a large company is likely to crush that spirit.
 
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