The word "entrepreneur" comes with a ton of baggage. So, let's talk about it.
What is Rework?
A podcast by Basecamp about the better way to work and run your business. In Season 2, we're going through Rework (the book) chapter by chapter and talking with authors, Jason Fried and David Heinemeier Hansson, about what's changed in the world of business over the last eleven years since the book was published.
David: [00:00:00] We're just talking about like the chapter, Jason, is super short in like the vintage style of how many short posts we used to have on Signal v. Noise. Where we’d just take a highly controversial opinion, basically just drop the mic after five paragraphs and that's it.
Jason: [00:00:13] Yeah. I like, though, the two paragraph ones.
David: [00:00:19] Yeah, exactly, that too. This one has one, two, three. There's three paragraphs in this essay, so.
Jason: [00:00:25] Fantastic.
David: [00:00:27] That's, yeah, that's pretty, pretty good. All right, you want to roll.
Shaun: [00:00:30] We're already rolling.
[00:00:31] Broken By Design by Clipart plays.
Shaun: [00:00:32] Welcome to Rework a podcast by Basecamp about the better way to work and run your business. I'm your host, Shaun Hildner. This week, we're going deep on the word “entrepreneur”. It's a big fancy term, and one that comes with a lot of baggage. It makes folks starting a business seem like a special rarity or members of an exclusive clique.
[00:00:52] In the book Rework, Jason and David provide an alternative in the word “starter”, but not sure if that really caught on.
[00:01:01] Here to talk about all that and more our Rework’s authors and the founders of Basecamp, David Heinemeier Hansson, how are you?
David: [00:01:06] I am good, Shaun.
Shaun: [00:01:07] And Jason Fried. How are you?
Jason: [00:01:10] Good, Shaun, how are you?
Shaun: [00:01:10] Can't complain. When you think of the word entrepreneur, you say that it comes with a lot of baggage. What are the sort of things that pop into your head when you hear that word?
Jason: [00:01:20] I'm trying to remember what it was like when we wrote the chapter. I remember having the thought that like, there's no reason to have this big fancy word. It's not that fancy, but it's still like “entrepreneur”, like what? And we’re just like, why don’t you, you’re just starting a business? It’s just starter. You’re just a starter.
[00:01:38] It just kind of one of these like, it just sounds grander than it is. And I think that was kind of the main pushback, is like you don't you don't need to be this fancy thing. You're just starting something up. So I don't know, it doesn't really bother me anymore. Actually, I think it used to bother me more than it did. But it still seems like an unnecessary word that just adds this grandeur to something that is actually not the, we've talked a bit about this before, it's not the hard part of it. Starting something is not the hard part of it. Staying around is the hard part of it. So like, why do we have this fancy word for something essentially, anyone can do, which is like just to try to start something. If we're gonna have a fancy word, it might be nice to for those who've been in business for 10 years to get the fancy word medal or something like that.
David: [00:02:18] I think the other problem here is just that the word has been loaded up with baggage by all the people who've claimed it proudly, and all the articles that have been written about what type of a person an entrepreneur is. So I think beyond just the fanciness of the word, I think there's also the fanciness, or the exclusivity of the definition. That the definition of entrepreneur is not actually helpful for someone who just wants to start a business. And much of the gatekeeping, if you will, that lays in that word comes from that definition that oh, an entrepreneur is someone who works 80 hour weeks. It's someone who takes a ton of risk. It's someone who gambles with a lot of capital.
[00:03:02] And then you think like, oh, that's not me, so maybe I shouldn't start a business. Well, we clearly showed that there was a different path where A, we weren't working 80 hour weeks, and B, we weren't raising a bunch of capital and all these other things that have been associated with the word entrepreneur.
[00:03:20] But you know, what, if I was gonna rant on this word again, now I’d rant on serial entrepreneur. Because that seemed like that was the, like, version two, or the next episode of entrepreneur.
[00:03:30] It was like, entrepreneur was cool. But you know, what's really cool, a serial entrepreneur? Oh, yeah. And I thought, like, ugh, no. And that, again, has just seeped into the definition of it, where I'll talk to someone, perhaps on another podcast, and they'll go like, so what's next?
Shaun: [00:03:51] Right.
David: [00:03:51] As the assumption being that everyone wants to be a serial entrepreneur, as everyone wants to like, well, this is just a temporary thing and then you want to go on. Which may or may not be the case. But couldn't you also just like, hey, I'm also good right now, or I'm happy with where I am. Like this whole thing that it's about the next thing? I'd write a rant around about that.
Shaun: [00:04:15] Yeah, I used to work for a man who described himself as a serial entrepreneur here in Chicago. And it always seemed like the kind of person that flips houses. Like it's this idea that somehow you can be good at this one thing and that one thing is starting and selling businesses as quickly and as profitably as possible.
Jason: [00:04:34] I think that's like an okay path, by the way, like, if that's what you want to do. Because you basically in that case, you have one customer. You have like, who's gonna buy the business, but you're not really starting a business. Or you're not really starting companies in that case? You're creating like a financial instrument.
Shaun: [00:04:48] The business is the product?
Jason: [00:04:49] Yeah, I mean, again, like, look, it's fine. It’s a fine thing to do, if that's what you want to do, but it's not really actually entrepreneurship, I don't think. Or really kind of building something that's going to last it's a financial transaction. Again, it's fine. It's just not really our interest, I would say. It hasn't been our interest. It's something you can do. That's a choice you can make. You can go down that road. But building a business and building products and hiring people and training people and building something together takes time.
[00:05:21] And if you're just in it to flip it, what you end up seeing is like, you just take a lot of shortcuts, and there's a lot of rough edges that you just pass on to someone else. And again, if that's the kind of person you are, that's fine, it's just not really that interesting to us. I think that's why we put that, or that's why we've been doing this for a long time.
David: [00:05:41] I always associate this with the kind of people who are like car executives, who can't talk about what their company makes in terms of cars, they have to talk about product, right? Like it's a category of thing, they could just as well be selling milk, or they could be selling marble, or they could be selling SUVs, they don't really give a fuck, right? Even in the presentation of it, it's just like, eh, whatever this thing is, the thing that people pay us for. And I just I have an aversion to that somewhere deep down, which as Jason said, perhaps the healthier approach would just be like eh, there are different people and they can like different things.
[00:06:20] But I don't know, I haven't become that loose with it or overcome that aversion myself. Because exactly that sense of someone who doesn't care about what they're actually, where it is just a financial instrument. That seems shallow, in a way, to me, that isn't appealing.
[00:06:42] And I also think it shows, I think it shows in the product. I think it shows in the company. I think it shows in the approach that someone takes to a business like that, when that is the sole outcome of it. You're not going to have someone like that think, you know what, we should go the extra mile in a way the customers don't even see, for the satisfaction of doing it.
[00:07:01] I often come back to, even though it's a trite example, the Steve Jobs, Wozniak thing where they talk about laying out the circuit board inside the original Apple. And Wozniak is like, no, no, no, we're gonna lay it out this way because the circuit board looks better. And you're like, but no one's gonna see it. Well, I'll know.
[00:07:19] And that's the kind of stuff where I'd go like, you know what? That feels like my kind of people. Which again, is fine. There's room for different kinds of people. But when someone just goes like, yeah, I don't give a, why would we do that? Just throw it in there, just so, I don't care, we need it out yesterday, that was the deadline, there's not time to do it right, there's not time to do it well, there's just time to do it enough. Which leads to this other thing we talked about car executives is like the Fight Club. If the cost of a recall is more than the rate of the explosion of the car, minus whatever it is, then we don't do one, right? That everything boils down to a financial calculation. Ugh.
[00:07:57] If the world was just full of that? Ugh.
Jason: [00:08:01] You guys brought it up a bit earlier with the houses, flipping houses, I think when you walk into a house that was designed by a developer simply to sell it quickly, you can see the quality is just not there. And the thing is, someone has to live in this house. So the person who built the house, they don't give a shit about who's gonna live there. They just want to make it as cheaply and look as fake nice as they can to generate as much profit on it then move on. But what they're leaving in their wake are problems for somebody else. And I think that's kind of what happens when you're just sort of quick flipping things and moving through things and building things to sell things, you don't really give a damn, you don't really care about the quality. You don't care who's left over. You don't care who's still there when you're gone. You just kind of keep moving on and you leave. It's not destruction in your wake, that's not true. But you leave poor quality and you leave the world, I think, worse off than better off.
[00:08:53] And then you just you just shove the problems on somebody else.
Shaun: [00:08:54] Yeah.
Jason: [00:08:55] So I think that's kind of the mentality that we're pushing back against here.
David: [00:08:59] And I think if you look at the, let's take the car example again, and let's take whatever, the ‘80s. American cars, right, they were total shit in terms of quality, just terrible, terrible vehicles that had all sorts of trouble all the time, right? And I think a lot of it came from that philosophy. Well, it doesn’t matter. And what are they going to do?
[00:09:20] Well, they're going to buy a bunch of Japanese cars, because they're now available, and they're so much better. Why are they so much better? Is it just because the Japanese were better business people? Well, maybe there was some of that. But it was also about how they approached the quality of things. The whole Agile software movement essentially came out of the Toyota manufacturing approach. That anyone, for example, on the assembly line could stop the assembly line, if they noticed that something was wrong in production and you go like, that's an approach to building something of quality. That is just inherently different.
[00:09:53] And that's of course, the other conceit here is that when you're trying to be this big B business person or big E entrepreneur and you go like, well, this is just a financial instrument or whatever. I don't actually think it pans out. Well, I want to believe that long term, it does not actually pan out, that it doesn't actually work to cut those corners. And over the long haul, you're going to create a reputation for yourself that doesn't end up being net positive.
[00:10:21] Because you look again, you take the Toyota example, Toyota has some of the cars that last the longest in the industry. That has created a brand, it’s created a allegiance from the customers of that who are just like, well, I just only buy Toyota cars because I know they last and they don't break down for silly reasons. And when they do break down, they don't cost a million to fix.
[00:10:42] And do you know what? That reputation, not just reputation, right? Because that could be faked. That reality of how they approach their business clearly paid off. Toyota is not some sort of tiny little shop doing an artisan thing. No, they're one of the biggest manufacturers of cars in the world. And it came from that. It is possible to do good business at high scale, with the values that go beyond it's just a product.
[00:11:10] Which is also this other thing. Sorry for staying in the car thing, but—
Jason: [00:11:13] David, do you like cars?
David: [00:11:15] Like, the CEO of Toyota, for the longest time, he would race at the Nürburgring 24 Hours. He would be part of the whole thing and like, a car guy through and through, which there were also some of those people on the American side. Let's not forget.
[00:11:32] But who was in charge of the American side? It seemed like whenever you’d read a story about Iacocca or any of the others, like it was just a temporary glitter. There was someone who cared about the product. And then they put out some great cars for a few years. And then that person got replaced by another big, B business person who went back to just caring about the short term, the next quarter, whatever. And then, bleh.
Shaun: [00:11:53] So how do you two define yourselves as business owners? Would you describe yourself as an entrepreneur? Or did you ever? Did you ever describe yourself as a starter?
Jason: [00:12:04] I've just always thought like, we own the business. We own a business. It's kind of how I would always sort of, I mean, I probably if you, someone wants to call me out, I'm sure I've used the word entrepreneur to describe myself. Whatever. Like, yeah. But I don't know. It's not a badge for me.
Shaun: [00:12:19] You don’t have a business card with that on it.
Jason: [00:12:21] No, but that'd be pretty amazing. No, I just, yeah, I own a business or, I run a business or something like that. That's all I've really kind of branded myself as. But again, I'm sure there's some statement out there where I'm saying something otherwise. But that's how I think about it.
[00:12:37] Entrepreneur is not really a point of pride, specifically. That's just like the mechanics of it.
Shaun: [00:12:42] Sure.
Jason: [00:12:42] You know, I think that the things that we make, how we make the things that we make, the people we work with, how we work with the people we work with, that's the more interesting side of it to me than the fact that technically, there's a label for the fact that someone owns shares in a business or owns the majority share. Whatever it is, I don't know, doesn't matter to me.
David: [00:12:58] This is also a story that it's very hard to change the vocabulary.
Jason: [00:13:02] Yep.
Shaun: [00:13:02] Yeah.
David: [00:13:02] We threw out this word starter, it didn't take off. No one calls themselves a starter, that's just not a thing, right? Like some way might read this chapter and go like, well, I can share your opposition to this word entrepreneur and the baggage and so on. But they didn't pick up the other term, because it's very hard to change language like that.
Shaun: [00:13:19] Sure.
David: [00:13:19] Particularly clearly, because entrepreneur has pull, still. It's the same reason that startup is one of those words I don't actually think we should give up on, because there's just so much interesting, positive, attractive energy in that. And if you recede from that and go, alright, startups, we don't talk to startups anymore, right? You give up on essentially a whole generation, or a whole ecosystem of people that you could influence with, in our humble opinion, better ideas than the ones that are currently being served to them.
[00:13:52] So I think sometimes you also just have to accept that's the word. We don't have the power to change the word. Let's load it up with some more positive connotations, or let's just or try to yank it in a different direction and say, it doesn't have to stand just for this, you can totally fight over the definition.
[00:14:10] But starter wasn't the winning move, clearly.
Shaun: [00:14:13] You talk about a group of people that don't consider themselves entrepreneurs, or maybe don't even consider themselves business owners. Who are these people that are that are making stuff, just doing what they love and not defining themselves? And would you put yourselves in that category?
Jason: [00:14:26] I just think about like this gardener who we use, a landscaper. Runs a small landscaping operation. It's got a few people. I've never heard him once refer to himself as an entrepreneur, or as a business. He's just like, this is what he loves to do. He loves to, he likes landscaping. He likes landscape design. Like that's just kind of what he likes to do. And if you want to make a living, you need to structure a business around it and the whole thing, but that's not the primary thing. I think you'll see a lot of people coming out of school or I'll go speak at a business school and everyone in the audience, everyone in the class wants to be an entrepreneur.
Shaun: [00:15:04] Yeah.
Jason: [00:15:04] I think this person wanted to work on landscape design. And they just have to have a business to, you got to call it something, you got to have a separate business account. It's a second order thing.
[00:15:15] So when I think of that, I know a number of people like that, who just do something that they like to do. For example, I'm about to start taking guitar lessons again. I used to take a long time ago, and to pick it up again. The guy I'm going to take lessons from like, it's his business, it’s just him. But he doesn't say I'm an entrepreneur. He's like, no, I teach guitar. I'm a musician.
Shaun: [00:15:37] Right.
Jason: [00:15:37] I happen to also have to like, take a payment. So let me set that stuff up. I think that's primarily.
[00:15:44] And then I'm using like small examples, because those are sort of perhaps easier examples to relate to. But I don’t know, I still don't really think of myself as an entrepreneur, either, really. I just like, we make some products, and—
Shaun: [00:15:56] Yeah.
David: [00:15:56] I think it works at a larger scale, too. For example, you can be a watchmaker, right? I make watches. I run a watch company. And there's a huge watch companies that’s been around for hundreds of years. And then there's some watch companies that started like a decade ago. And there's all of these people, I think, define themselves by watches first, hopefully, not by product.
[00:16:20] And that's one thing that's actually interesting is that when you look at cultures around the world, and certain cultures seem to have, watches, for example, it's a Swiss thing. It's not the same thing. This obsession with product, this obsession with being a business person is not evenly distributed across the globe. There's not as many people in, say, Switzerland, I think, who think of themselves in that way.
[00:16:41] I’m, just using the example from watches, right,. Just listening to interviews with CEOs of watch companies, they don't talk about themselves in the same terms as a product person in the US would talk about products. And I think that that's just more, it's more interesting, it's more revealing that these are people who are where they are because they actually also know a damn, about what they're doing.
[00:17:07] And this is, again, this idea. I remember reading this old book, I think it was called The E Myth or something about like, hey, the worst person to run a bakery is a baker, for example. And they turned all the advantages of knowing something about what you make against that person. This is why you shouldn't be a business person, because you'll care too much about the quality of the flour. And did you know if you could save a little money on the flour that could you could pour that into profits, and then you could open another five bakeries and blah, blah, blah, blah, blah, right?
[00:17:36] And I remember reading the book at the time thinking like, yeah, yeah. I just came out of business school at the time, right, so of course I went, yeah, yeah. Because I learned all these generic approaches to like any business, and I thought, like, yeah, you should just have some executives in charge of everything. And now I think back on that, with just horror. No, absolutely fucking not. If you want to run a great bakery, you should have a goddamn baker in charge of it not a fucking executive.
Shaun: [00:18:03] Yeah, it seems like the big difference in terms here is that the baker or the dude that owns a landscaping company is actually out there pulling weeds and baking bread. And you two are doing programming and designing. Your full time job isn't CEO and CTO.
David: [00:18:19] Which, I think that shouldn't be the dividing line, because there are people whose full time job is to be executive who still aren't big executives, right? Like, they're not just like, hey, I could just as well run a milk company as a baking enterprise as a car company, but are a little more specific than that. And because they care about the specifics of what they build. Now, I think this is where we come into, we are defined by what we came up with. And there’s some myopia in that. I think it is fair to say that there is also craft to do the business of it. It's just, it seems to me so often, at least the appearance of it is that you see these archetypes of it, and you just go like, ugh. Versus I see an archetype of someone who really cares about what they build, and I go, like, I'm inspired by that.
[00:19:08] It's pretty rare, I'd say that I'm listening to someone who's like, just a business person who could be a business person, wherever. And I just go like, wow. It does happen, though, right? They're excellent people in all fields. It just seemed like, I don't know if it's universally distributed, in likeability perhaps. But that's perhaps also one of those other things where you just go like, do you know what, out of the millions of businesses in the world are you going to have people who are just like, oh so, ever so passionate about everything? Someone also has to make and sell, I don't know, fucking diapers. I don’t know, maybe there's someone who's really excited about making diapers. There probably is, but maybe there's not enough of them for us to sort of supply the world's supply of diapers here. And some people just have to make the freaking trains run.
Shaun: [00:19:49] Sure.
Jason: [00:19:50] And by the way, someone might someone might say the same thing about what we do, right? Like, someone has to make fucking, I don't know productivity software.
David: [00:19:56] Totally, totally. Yes.
Jason: [00:19:58] It’s all perspective and where you're coming from, but I just don't want us to sound like we've chosen the special path. It’s like, no, this is just kind of how we're doing it and our opinion about it, obviously. But there's nothing particularly special about software. Any more special than diapers, like, you can make good ones, and you can make bad ones. And there's different approaches, I'm sure, and you can cut corners, or you can do it the right way and the whole thing.
[00:20:23] One of the things I love is I love buying products from companies run by enthusiasts .And maybe David, this is kind of a little bit what you're getting at.
David: [00:20:30] Yes, that's exactly. That is a good way of framing it.
Jason: [00:20:33] Yeah, like so I own this coffee grinder. This is a guy out of Seattle.
Shaun: [00:20:39] Interesting, a coffee guy out of Seattle.
Jason: [00:20:41] Yeah, of course.
David: [00:20:43] This is like watchmakers out of Switzerland.
Jason: [00:20:45] Yeah, exactly.
Shaun: [00:20:46] Yeah, exactly.
Jason: [00:20:47] So I own this coffee machine, or this grinder called the Monolith. It's completely overbuilt, and completely ridiculously incredible. Like, it weighs 15 pounds. It looks like a microscope, it's the most incredibly made thing that can only come from an enthusiast. There is no reason for anyone to build a grinder this good. Like, there's just no reason for it. There's no commercial viability, in a sense, there aren't enough customers to buy something like this mass market where like a company like Braun, or you know, Breville might make it. They just wouldn't make something like this. It's unnecessary.
[00:21:22] But I love it because this guy gives a damn, clearly. And his built it to the level that just satisfies him. And he wouldn't take anything less. And it's like, I like to support businesses like that. I like to support products like that. They're ridiculously over done. But I like that.
[00:21:37]And so I think you get a sense, and to David's point about watchmakers and watchmaking, especially with independents, you get a sense that there's an enthusiast behind the scenes that wants something to exist that doesn't exist in the world. And they know no one else is going to make it unless they make it. It's fun to support businesses like that.
Shaun: [00:21:54] Yeah.
Jason: [00:21:55] They're not the only ones. To David's point, too you need someone to make diapers, and you don't necessarily need a diaper enthusiast. But there are lots of products out there where like, you go, ah, someone behind the scenes really gives a damn about this. And I can tell because I give a damn, too, and our giving a damn lines up. And you go, ah, impressive. Someone's out there like me or someone’s out there that I can be impressed with. Or I didn't even know someone could make a grinder this good. That's exciting to me.
[00:22:20] I think you see it too in brands like Leica. You can have larger brands who clearly, they give a damn about what they make. Apple gives a damn about what they make. There’s companies like that that give a damn what they make. And it's fun to buy things from people like that.
David: [00:22:31] I think actually, I mean, again, apologies for using the trite example but, Steve Jobs is a good example of actually a business person who had that kind of enthusiasm, even if he was not the one himself building the thing. Right, like he was actually a business person in terms of the contributions that he made. He didn't do any of the programming. He didn't do any of the industrial design, molding, or whatever. He was a serious enthusiast about the products that were built. That literally turned that company into the biggest company in the world.
[00:23:04] So I think that's an important counterpoint to it's a bunch of individual enthusiasts who sit in their own workshop and do the thing. That enthusiasm can absolutely also scale up to trillions of dollars in terms of the market that runs it.
[00:23:21] Jason, the other example I think you pointed it to me was there's this guy making Saddleback.
Jason: [00:23:26] Oh, yeah, Saddleback, yeah yeah. Saddleback Leather.
David: [00:23:28] And he has this wonderful YouTube channel where he's like, hey, here's how to make a crappy saddlebag. And he goes over all the corners you can cut and how they usually are cut. And of course, this is like, well, this because I'm not cutting them. It's one of those things, too, where you don't actually have to be an enthusiastic about the thing itself to be a consumer of that and be really inspired, where I'm like, just, man, this is fascinating. I did not know that you could care this much about saddlebags. But it's infectious. And I'm like, I kind of want a saddlebag that's over engineered and will last for a million years.
[00:24:02] Which, and I'm going to absolutely put in another car example here. This is what people used to say about Mercedes, that the cars were overbuilt, that they were overengineered. And in fact, this is exactly what then happened to Mercedes in their dark errors in the mid-2000s, where they made some of the crappiest cars that brand has ever put out. They were both the worst in terms of design, reliability, and whatever. Because someone came in and said, do you know what, engineers have been running this place for too long. Why are we overbuilding these cars? Most people keep their cars on a lease for two years. Who cares if it works for 20 years? Use worse components, less redundancy, less testing, and then they put out a bunch of products and the bean counters thought, like, nobody will notice. And fucking everyone noticed. They went like oh, no, this is not good enough. I want that overbuilt German tank again, bring it back.
Shaun: [00:24:58] Well, I think this is a great place to stop. We’ve fulfilled our legal mandate to, for every business podcast we have to mention Steve Jobs, luxury watches, and luxury cars. So this is perfect.
[00:25:11] What a fantastic place to end.
Jason: [00:25:11] Let’s rename this podcast, The Rework Elite Podcast.
Shaun: [00:25:15] Yeah, exactly.
[00:25:17] This one's gonna be in our subscribers only feed.
[00:25:20] Next week we are talking about the chapter “Make a Dent in the Universe.” So I will see both of you next week. Thank you once again, David Heinemeier Hansson.
David: [00:25:30] All right, thanks.
Shaun: [00:25:30] And thank you, Jason Fried.
Jason: [00:25:32] Thank you, Shaun.
David: [00:25:33] Oh, let me just plug it in. Cars, cars, cars, cars, cars, cars, cars, cars.
Shaun and Jason: [00:25:38] [Laugh]
[00:25:39] Broken By Design by Clipart plays.
Shaun: [00:25:44] Rework is a production of Basecamp. Our theme music is by Clipart. You can find us on the rework.fm and on Twitter at @reworkpodcast.
[00:25:54] If you're following along with our little book club, next week, we'll be discussing the chapter “Make a Dent in the Universe.”
[00:26:00] Oh, and one more thing. I'd love to hear from you, the listener. If you have any comments about the show or questions for Jason or David, leave us a voicemail at 708-628-7850.
[00:26:13] Or better yet, record a voice memo on your phone and email it to email@example.com.
Fight Club Clip: [00:26:31] Narrator: Take the number of vehicles in the field A, multiply it by the probable rate of failure, B. Then multiply the result by the average out of court settlement, C. A times B times C equals X. If X is less than the cost of a recall, we don't do one.
[00:26:51] Woman on plane: Are there are a lot of these kinds of accidents?
[00:26:54] Narrator: You wouldn't believe.