by Erin Martin
On Thursday, February 22nd, the Martin Trust Center for MIT Entrepreneurship hosted Bill Gurley, partner at Benchmark Ventures, for a fireside chat. As an early investor in companies like Uber, OpenTable, Stitch Fix, and Zillow, Gurley has demonstrated an exceptional ability to anticipate where economic opportunity lies then backing companies best suited to reap the benefits of where the market is heading.
The Trust Center seeks to put thought leaders like Gurley in front of the MIT community as part of our “inspire” initiative, with the goal of encouraging more students to explore their entrepreneurial spirit. Throughout the discussion between Gurley and Trust Center managing director Bill Aulet, students heard advice for how to stay relevant and on top of market trends, as well as his opinion on what skills are needed to be a successful entrepreneur.
His best advice for aspiring entrepreneurs or venture funders was to stay engaged. Gurley says he utilizes Twitter (@bgurley) to follow what thought leaders are circulating as important ideas, believing that watching what people are sharing allows him to see where there is room for innovation. Additionally, Gurley explained that podcasts are an incredible tool for what types of ideas are gaining attention and what people are doing to address the problems of today. Podcasts are unique in that they allow listeners to digest a lot of information and effortlessly learn from other’s perspectives.
Beyond his tactical advice on how best to immerse oneself in the entrepreneurial ecosystem, Gurley declared that founders can greatly benefit from earning an MBA. “Winners don’t have the idea first; they figure out how to beat the competition by navigating the market and grow big first”, he argued. Founders need to understand the foundation of how a business runs and how markets work. Without prompting from the Martin Trust Center team, Gurley reinforced our philosophy that entrepreneurship is a craft that can be taught and requires much more than just a big idea.
So how does earning an MBA really help founders be more successful? Gurley feels that entrepreneurs with a business degree are better prepared to share the same language as investors, portraying their company’s vision in familiar terms. Furthermore, those with MBAs often are better prepared to face the variety of roles within small ventures from financials to marketing and scaling.
Throughout the conversation Gurley emphasized that short-term cash flows can be distracting for entrepreneurs who need to be strategic in their decision making to best navigate and capture the market. He argued the individuals that “win” the game are the ones who make long-term decisions and believes startups should aim to IPO sooner rather than later as a forcing mechanism for the company to focus on a strategy for long-term cash flow. Many founders fear going public too early will give competitors the chance to replicate their secret sauce; to challenge this assumption Gurley used the analogy of a professional athlete refusing to compete because the other teams would be able scout their performance and find ways to defeat them. A professional athlete would never do that. Similarly, an entrepreneur should be in the game and ready to compete because they have the best team and the best product.
Thank you to Bill Gurley for the wisdom and perspective he shared with out MIT community! Please check out our next speaker David Maddocks, CMO of Cole Haan, to explore how innovation can be a turn-around strategy for larger corporations.