Rob Kornblum on ‘Give Your Kids the Gift of Entrepreneurship’

Dec 18

In: Entrepreneurship, Family life, Guest posts

I’m always on the look out for helpful advice on parenting. So, when Rob Kornblum told me he was writing about the topic, I was really excited. He is an Internet entrepreneur and a former venture capitalist. Rob has a blog called StartLaunchGrow and is about to publish a book, “It’s Never Too Late,” which is about mid-life entrepreneurship.

Here is Rob’s guest post. 

You can hear it, right?

The ripping and tearing of wrapping paper and the squeals of delight. The sounds of Christmas morning or Chanukah gift opening. But do the kids really need more STUFF?

This holiday season, in addition to all the toys and trinkets you will get for your kids, you might be able to give them a gift that will last a lifetime- the tools to become successful entrepreneurs.

Maybe you dream of your kid becoming the next Mark Zuckerberg. Or maybe you realize that the era of “go to college, find a good job, settle down” is long gone. We are in an era of multiple career changes, distributed work forces and free agency.

Are my kids going to grow up and start great companies? I’m not really sure. But even if they don’t, I’m convinced this is a good gift, because they will almost certainly need to think entrepreneurially to manage their own career.  At some point, they’ll probably be an independent contractor or a freelancer.

So what are some concrete steps that you can take to help your kids learn to be entrepreneurial?

Grit

One thing we know as entrepreneurs is that things rarely go as planned. One of THE most important skills we can teach our kids is perseverance and grit. Unfortunately, most kids today are not developing this crucial skill. How can a kid learn to persevere and push themselves when “everyone gets a trophy”?

There are a number of ways to help bolster your kid’s grit.

Put a challenge in front of them that you know they might struggle with. Help them learn to set goals toward that challenge, and also how to use systems to achieve those goals.  By that I mean regular practice, even as little as 5-10 minutes a day, can produce new habits and extraordinary results.  Let them see how small efforts and small increments add up to improvement over time.

Praise their effort and perseverance, rather than their intelligence or smarts or grades. Research has shown that praising children’s effort produces a “growth” mindset in which children thrive on challenges. Rather than saying “You did really well on these problems,” try saying “You must have worked really hard on these problems.”

This can help them see that failure is not something to be afraid of, but that we all get up from our failures and move on.

One really interesting and fun way to promote perseverance is to teach your children more about your family. Don’t just teach them any family facts, but particularly ones that help your kids to see themselves as part of something bigger.  According to research from Dr. Marshall Duke (New York Times, Bruce Feiler, March 13, 2013,) kids who know more about their family history can handle stress and show more perseverance than those who do not.  “The answers have to do with a child’s sense of being part of a larger family,” said Duke.

My wife and I have had fun teaching our kids about when our grandparents came to this country, where our parents went to school, how we met and ultimately married, and other family stories. And not just the history but the traditions and the context. All of these can help kids overcome hardship because it gives them a framework and a context for their own struggles.

“The most healthful narrative,” according to Duke, “is… called the oscillating family narrative: ‘Dear, let me tell you, we’ve had ups and downs in our family. We built a family business. Your grandfather was a pillar of the community. Your mother was on the board of the hospital. But we also had setbacks. You had an uncle who was once arrested. We had a house burn down. Your father lost a job. But no matter what happened, we always stuck together as a family.’ ”

Financial Basics

Even if you’re not an expert, helping your kids learn the basics of personal finance is a great way to get started. Most people believe that a child should get an allowance and many experts suggest that kids have their own bank account. Learning how to budget, how to save for something they want, and allocating some money toward charity are great life lessons for every child.

If your kids are a little older, help them to learn the basic financial terminology of business. Lemonade stands are great fun, but imagine using the lemonade stand to help your kids learn about revenue, expenses, and profits. It’s really easy to run a lemonade stand if Mom gives you the lemonade and the cookies, but imagine if they had to buy those things, or even buy the stand. If you’re really unsure about these concepts, you can learn it with them at a free web site like kidsfinance.com or khanacademy.com.

Curiosity

Entrepreneurs are always discovering new ways to do things and also finding things that they are dissatisfied with and finding better ways to approach them. So many great startups, including eBay, Facebook, and Uber, were created to solve a founder’s “problem.”

Curiosity and lifelong learning is something that you can spark in your kids through reading, science, building with Legos and many other ways.

One way to bolster your kids’ curiosity is to help them think about what could be improved when they find things that “stink.” The next time you or your kids are complaining about something, ask them “What could be better about that?” and maybe the “better” version could be a company solving that problem for lots of people.

Technical Skills

Technology skills are crucial in today’s society and workforce. Kids obviously take pretty natively to mobile and gaming, and it’s not much of a stretch for them to take that comfort and familiarity to learn programming and game design. There are so many good sites and applications for helping kids learn to code such as Scratch, being a Mod in Minecraft (if you don’t know, ask your kids), or online classes.

Even if your kids aren’t into coding, you can help them learn other technical basics like how to set up a web site, how to use Google analytics, or how to run a blog, or wiki. These are pretty easy for kids to learn and will advance their ability to test their own ideas.

One thing that I am doing right now is learning alongside one of my kids. Like a lot of bloggers, I needed to beef up my knowledge of HTML for my blog. So I’m talking a Udemy.com class and decided to do it with my teenager. He’s excited to learn and already asking me when we can sit down and go through the next module.

Planning

One of the things I have seen my kids and most young entrepreneurs struggle with is planning.  Because their school learning is so structured, kids follow a structured plan or syllabus for almost all of their class work.  When I mentor entrepreneurs, even college age founders, they struggle with basic planning skills like goal setting and breaking down goals into subtasks. Teaching your kids how to plan may be one of the most important skills they need as an entrepreneur.

There are two ways I have tried to help my kids learn how to plan. The first is short-term and medium-term goal setting. I ask “Where do you want to be in two weeks?” and “what are you going to do, and when are you going to do it, to get there?” The second way is to encourage regular habits of practice. I ask them to work on something for 10 minutes a day, with a calendar and a red pen to ‘X’ out the days. This is especially powerful where the goals are harder to quantify.

Involve Them in Your Efforts

Most of us learn through experience, and your kids are probably no exception. If you’re an entrepreneur, let your kids see what you do in your business.  You can help open their eyes to the world of entrepreneurship, not just the meetings and e-mails, but the cool parts like your company’s mission. Show them the stuff that moves you, the stuff you’re passionate about. How you help customers. I have some friends who even take their kids on business trips.

There’s a funny thing about startups with multiple family members.  After they get past the life-and-death startup phase, they become “family owned businesses,” like Wal-Mart and Fidelity, one of the biggest categories of employers in the U.S.

You might think being an entrepreneur is risky- you might not want to subject your kids to that kind of risk. But isn’t it risky for them to try to navigate corporate America? College, grad school?

Think about it this holiday season as you wander the aisles or eCommerce sites looking for gifts. Give your kids some real tools for their future. Maybe they will become a startup CEO, maybe not. But it will help them navigate their path… isn’t that better than a bunch of new stuff for the holidays?

Our Night Out

Dec 14

In: Personal

Last night, my wife and I went to a fun holiday party. We go each year. It is one of my favorite social events.

There were ice sculptures on each table, massive bars made of ice, beautiful candles, tons of great food, and a DJ. There was a cool snow machine, and upon leaving the party, you were invited to don cheesy hats and accessories and have photos taken in a photo booth. We got home at midnight, which is super-late for us, as it was such a fun night out.

At the party, we meet up each year with the same other couples. It is a great time to hang out together and be merry. There’s always a lot of laughter, and everyone is at ease. These friendships have been a huge plus in my life. It is really fun to go out for a special evening and hang out with these particular friends.

I want to note a particular conversation thread, whereby a friend and I talked about ways to be more detached from material possessions. As for me, I think my next car will be used. Perhaps, a pick-up truck for the fly fishing I’m hoping to do. I think doing that would help wean me from consumerism.

It was great to see you Jim, Katherine, Andy, Lisa, Merrill and Paul!  Jim and Diane, we missed you!

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My Version of Paradise

Dec 13

In: Family life, Fly fishing, Personal

The Boston area suddenly has transitioned to the winter holiday season.

This Saturday, the store parking lots are jammed, as people prepare for Christmas and Hanukkah. Many cars have Christmas trees lashed on top. There’s been some snow, and walkways at times have patches of black ice. Outside, there’s a near-constant smell of smoke from invisible fireplaces in the neighborhood. The air is chilly.

We bought our tree this afternoon, and so, the house is redolent with the scent of pine. Some of our children are singing Christmas carols.

Even though it’s cold, about an hour’s drive away, there’s a secret river spot for me. I can fish and get home without too much ado. And, there, in the middle of thick woods and snow-covered trails, is my version of paradise in a winter wonderland.

A good weekend to you all….

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#TBT: David Miller and ‘The Little Prince’

Dec 11

In: Books, Personal

As I was readying to leave the house this morning, I spotted a book, a copy of The Little Prince. Some members of our family recently saw a play based on the book, and one of them must be reading the text for fun.

I picked up the book and opened it. I saw this:

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It is from a high school classmate’s mother. Her son, David Miller, was unique. Incredibly smart and a gentle soul with a sense for fun. He had bleached blonde and spiky hair, like Billy Idol. For some reason, I still remember his cursive handwriting: lots of loopy letters, a bit sloppy, but written with a confident hand.

He was co-editor of the school yearbook. Our school had a literary journal and his writing pieces were often featured. I think I am a decent writer, but David’s prose was a great deal more lyrical and insightful.

He was much admired and well-liked. Every young lady seemed to have a crush on him. David was unfailingly polite and funny with all classmates, which was hard to do given the social cliques that fissured a very large grade.

In our senior year, David was driving some friends down a windy road on a slick road. The car skidded and hit a tree. Everyone else was ok, but David was badly hurt. He faded into a coma.

Many of us wrote heartfelt notes to David, which his mother read out loud to him. His mother, a single parent, had to make the hard decision to remove life support from her only child.

I will never forget the time in AP U.S. History, when the school principal interrupted classes to announce to the school over the PA that David had died.

Every few years, I think of David. I remember how strong his mother was amidst all the uncertainty. A few of us in his class even just recently referenced him in a Facebook message thread. David was a great individual, and I have many good memories of him.

I have tried to track down Cheryl A. Miller. If anyone can help me, I’d greatly appreciate it. I just wanted to say hello to her and to wish to her my best.

When Your VC Financing Is a ‘Busted Auction’

Dec 10

In: Entrepreneurship, Technology and VC

Auctions are curious things. Moreover, the mere perception of being in an auction is more than enough to inject fear into a discussion.

I’m writing this because of two things. First, I connected recently with another VC, who commented that his firm was about to invest in its first [insert here name of famous incubator] company. But, he said they normally don’t invest in companies out of incubators because they’re concerned about over-paying and the “winner’s curse.” If I heard him right, the supposition is that those companies are shopped around heavily. In other words, they feared the pricing impact of an auction.

Second, the Red Sox were not able to re-sign Jon Lester, who was one of their star pitchers.  They last year supposedly offered to him $70 million, perceived as a low-ball number (no pun intended), with the hopes of ending up around $115 million. They probably feared being in an auction, but also calculated that Lester himself didn’t want the uncertainty of where he would live next and thereby would take a “hometown discount” (like other baseball players often do).

Since Lester was still under contract and could not negotiate with other teams, the Red Sox presumably had leverage. But, here’s the rub. Lester’s agents declined to counter-offer, as the offer was so low. They suspended the talks. They instead guided Lester to hit free agency, or the auction, once his existing contract expired.

Today, Lester has signed with the Chicago Cubs for $155 million. The Red Sox’s had upped their offer to $135 million but lost out. So, their strategy of pre-empting the auction didn’t work.

As a VC, you’re always mindful of The Auction. You always want to be the first person on whom the entrepreneur calls for a financing. You never want to be one of dozens of VCs, or worse, be at the bottom of the list, whereby the entrepreneur has called on all other VCs, who passed, and now comes to you. This is what VCs call a “busted auction.”

That’s the perception.

But, I wonder what the reality is? IMO, I think every financing is effectively auctioned these days. With social media, blogs and more accessible VCs, the entrepreneur can reach out to anyone pretty quickly.

But, with human nature the way it is, if you’ve been fundraising for months or years, the VC is likely to know. Just be up front and have good and honest answers about why. Reasonable and good reasons I’ve heard include the following: the company has done a pivot, there’s more “traction” now, you called on VCs who aren’t really experts in your space, you’re new to fundraising and it took time to get good at it, etc.

I think the worse thing to do is to ignore the elephant in the room. Auctions are real, as are perceptions of them, and the entrepreneur should consider how he/she manages the VC’s views of them.

I think two of the most powerful human emotions are fear and greed. VCs want to make money, but they fear that they’re the “sucker in the crowd” if everyone else has seen a financing and passed. Many entrepreneurs focus on the VC’s greed, but IMO, not enough focus on the VC’s fear.