Andy Palmer has started at least five companies by my count–and I’d guess he has invested in dozens of others. Based on that experience, I’d consider him an expert when it comes to deciding whether you have what it takes to be an entrepreneur.
After graduating from Bowdoin with a major in English, History, and Computer Science, the passionate Rugby player was injured and decided to become serious about a career. So he got an MBA from Dartmouth’s Tuck School.
From there, Palmer went on to be part of the founding team of five start-ups: Austin’s Trilogy; pcOrder.com, a Trilogy spinoff for buying PCs and software online, that was spun back in; Bowstreet, a “portal-based tool provider,” that IBM acquired in 2006, Infinity Pharmaceuticals, a cancer drug developer that went public 2000; and Vertica Systems, a database company that Hewlett Packard bought in 2011.
Now Palmer spends half his time on life sciences and half on tech start-ups. He has invested an average of $75,000 in some 30 ventures; is a founding board member for six companies; and works on more altruistic projects–such as collaborating with MIT’s Broad Institute to help develop a genomics information system.
Here are five thoughts Palmer offered on what he would tell a young person considering whether to become an entrepreneur.
1. Look hard at your true entrepreneurial potential
Palmer pointed out that potential entrepreneurs must know where they are on the “bell curve.” As he said, “Some people like Steve Jobs or Bill Gates are destined to be entrepreneurs and nothing will stop them. Others are one standard deviation out of the bell curve. They could be entrepreneurs under the right circumstances. But most people are just average when it comes to their entrepreneurial potential.”
This self-assessment has important implications. If you are destined to be an entrepreneur, there is no need to ask anyone else’s opinion. You will start companies. If you are one standard deviation out, then you need to find the right circumstances–meaning you must pick the right opportunity to target and figure out which key entrepreneurial talent you bring to the party and partner to find your missing piece.
2. Find a partner who excels where you don’t
This brings us to Palmer’s idea that the idea of the hero entrepreneur–Larry Ellison against the world–is outmoded. He looks at Google as a model which is run by a troika of Larry Page, Sergey Brin, and Eric Schmidt. Each of them have different strengths and they are willing to work together to apply those strengths to helping the company grow and adapt to change.
For most technology start-ups, there are two skills needed at the beginning, business (which includes sales, marketing, and handling capital raising and accounting) and technology development. If you are excellent at one or the other of these skills, you should find a partner who excels at the other skill.
For example, when Palmer started Vertica, he was in charge of the business side and he partnered with a database expert, Michael Stonebraker.
3. Pick a partner who shares your values
How does the business person know which technology person to partner with and vice versa? Palmer believes that values make all the difference. He argued, “It is a big responsibility to be developing a new product for a customer. As a business person, I want to make sure that potential customers do not get an overly optimistic view of where we are in our development process.”