Startup Story: Entrepreneurship as a Love Affair
Questioner Namaste Acharya Ji. So today we have a special session with students from the University of California at Berkeley. They have been wanting to have an interaction with you for quite some time. So right now we have thousands of students, faculty and also other participants who have joined the session.
Questioner Hi, I'm Padma Jay. I'm a master's student in global studies here at UC Berkeley, currently in my second year. I have been following Acharya Ji for a while now. I'm really excited for this conversation.
My first question to you, Acharya Ji is that your teachings have emphasized rationality and practicality which have deeply impacted the way I approach my life and decisions. As I nearly graduate from Berkeley in just about 3 months, I've been reflecting on the path forward. In many ways, entrepreneurship seems to be an answer which could be potentially the career that I choose going forward. However, it does feel like a huge leap into the unknown. It's undeniably risky and despite wanting to rely on logic and reason, I often find myself needing to trust in something beyond pure analysis. How can uh according to you someone striving to achieve big, um uncertain dreams uh like building a business balance uh the need for rational decision-making with the faith required to sort of take on those bold leap forward.
Acharya Prashant: No, there need not be a balance. To begin with, there has to be a certainty and certainties are not balanced. When you talk of a balance, you're talking of probabilities. In the external world obviously things are probabilistic. The outcomes are not in your control. But in the inner world there can be a certainty and that's where one has to start from. Be it entrepreneurship or be it any worthwhile one wants to undertake in life.
So one starts from there. One knows what one is getting into is definitely worth doing. It is something one can give herself to, irrespective of what comes out of it, that kind of certainty and then comes the rational planning and decision making part. So I'm into something that deserves to be done and then I apply my intellect all the accumulated knowledge and my skills I have gathered over my MBA or other programs and I come up with a plan, a road map that looks into the future and obviously there you cannot have certainty there you will have scenarios and all scenarios are probabilistic and you look into them and you want to obviously maximize the probability of your success, success in terms of numbers, attainments, break evens and such things.
But then those are all probabilities, things can any day go wrong. What will uphold you then is the fundamental certainty you started from and that itself is faith. To get into what is right without worrying too much about the outcome. To be sure that the effort and the process itself is worth it even if nothing or very little tangible comes out of it. That is faith.
If you want to have everything neatly planned out and set in stone and then it does not require any faith and then there is no thrill in it either. And somehow the nature of the right work, the right endeavor is always such that you can never be sure of the outcome. Reason being it is never the beaten track when it comes to the right endeavor. You can be sure of things when let's say you are entering an industry. Then you can look at the data of the startups over the last 10 years in that particular segment and you could say well there seems to be a success rate of 48.4%. For that you need others who have taken the same path and you are just following the trail but that's not really the nature of the right work.
When you'll get into something really worthwhile you might find that you are probably the first one going in that direction or very few have gone in that direction. So you will not have data to compare yourself with or the right metrics to base your projections on. So then you'll have to simply say well we do not know what's going to come upon us tomorrow. But what's definite is that the effort and the journey are going to be worth it. And this in no way excludes rationality. It includes everything that you have learned at your uh university. It includes application of your IQ. It includes meeting experts. It includes doing industry analysis. Everything that can be done. But first of all it is about starting from the right place. You start from the right place and then let intellect be the tool to achieve the end that you have in sight or if there is no particular end in sight then let intellect be the tool to help you navigate the path you have chosen even if that path has no clear destination.
So this is what I'm talking of is not at all uh just mystical or irrational this involves the application of all the rationality you can summon but rationality is not the point you can start from. Because at your core, you and I and each one of us are people seeking purpose. Purpose and fulfillment. Now, fulfillment has no rational answer. It's like love. Rationality assumes a secondary position there. We are not saying you need to be irrational there but that comes later. So as a young person setting out in life you must ask yourself I have like 40 years to work what would I want to invest this single precious life I have in?
It's not about emulating others seeing where the maximum chances of financial success are. Not that those calculations need not be done. I'm reiterating again and again. Those calculations obviously need to be done but they come later. The first dialogue is with oneself. I have a long life to live and I have 40 years to work. What is it that I can turn up for daily? You'll have to show up every morning. No. And if you're talking of entrepreneurship the mornings never really end. You show up and then you show up and then you show up and you figure out it's midnight and you still have to show up for something. So, it's a thing of the heart and you have to be very clear there.
You see, I have seen a lot of startups, my batchmates and others and have mentored a few of them. In fact, we often talk of the dismal success rate of startups. But we do not research deeper into it and figure out where exactly did the decision to down the shutters come from. It is usually not coming from an inherently flawed business plan. You all are smart people and similar in India we have smart people who come up with really good business plans. It's just that that entire plan is for the sake of a financial end result. At which point people want to come up with an IPO and then make an exit and then enjoy the fruits of their smartness. So people don't quit because success is not forthcoming at all. People quit because their expectations, their financial expectations are not really being met. They find that the numbers that they targeted may take three times more effort and more duration to come at.
And then if you really have your conviction and your heart into it then you will try to find different ways you will say I'm not going to quit you say if if this thing is not working out I'll try it this way I'll try it that way I'll try it that way because quitting is not an option but quitting is a very very lucrative option when you want to gather riches in the fourth year itself. And that's the reason some of the very good ideas and feasible projects are brought to a quick and untimely closure. Had those people persisted, probably they would have reached somewhere maybe not the place that they targeted but some other decent place then there was no conviction in the project itself. The eye was very focused on using the project to reach a particular place in the shortest time possible and that's what results in the so-called failure and closure and these things. There is no way you can fail if you never stop trying, no?
Failure in something like a startup is only when you decide that you have failed. Right? If you say I've not yet failed, I'll give it another go. But then when you have already raised a huge cost structure then you want commensurate revenues as well because the revenues were anyway always for the sake of affording the cost. Yeah. And a lot of that cost is simply personal fantasies. Now I have raised funds so I can spend them this way, that way, lavish office, personal expenses, so much more. And now that this cost structure is there, it demands a particular level of revenue and if that doesn't seem in sight, one says I'm hanging up the boots. Don't let that happen. First of all, that internal dialogue should be very clear and then one really fails.
Questioner Acharya Ji, on the internal dialogue that you're mentioning. A lot of times when we are having that first internal dialogue with ourselves, there's a lot of self-doubt that comes with it because when you're starting off, especially when you're young, you're not too sure of yourself as an individual too. Like how do we navigate that in that process?
Acharya Prashant: You see this self-doubt is usually in the context of others. So we call it self-doubt. But it has less to do with self and more to do with others. Are others taking this same beaten path? What will others think of me? How does this compare with all the case studies I have poured my nights into? This doesn't look like any of them. So, it's all about the influence of others of skating your vision.
I'm not saying that those case studies and the management principles and the financial analysis, they are no good. They obviously are but they have to be kept aside when it comes to determining the purpose of a young person's life. Keep all that aside. We'll pick that up when we need to use the tools to navigate the way. No, there are tools. They cannot be our masters. They are tools.
Some management experts might have given a fabulous theory. That's fine. Great sir. Thank you so much. But I have my own life to live. I'll use your theory. I'll not allow your theory to use me. Huh?
So the thing will be mine and the operational aspects of it I'm glad to learn from anywhere. Right? Operations I can learn, strategies I can learn, but purpose, I'm not going to pick from anywhere the purpose will be fully mine. So from there comes that self assurance right? Next time when you have a bout of self-doubt ask yourself is it me or is it others?
We need to look look nice and smart and if you want to raise funds you will be presenting your ideas and a nice PPT and you have these gray old men sitting in front of you and they say you know 48 successful ventures we have seen in our life and this young woman has come and she's coming up with this very eccentric idea and they look at each other and smirk and that totally saps the confidence out of you let that not happen right?
Let them have their wisdom, experience everything and we want to use that. We want to use experience and we want to use your funds but the purpose will be mine. The purpose will be mine.
Questioner Acharya Ji, one more thing on the fact that you brought up the right part to take and you know finding your own purpose. Especially at a young age it's very difficult for people to know what their purpose is and as you said it's very influenced by what people around them are doing. Right?
So I just wanted to ask how do you know you go about finding your own purpose? Are there practices that you should do so that you can eventually find your own purpose? And more so on the quitting part as well. I mean we always speak about how you should know the right time to quit and not be boggled down by one idea for long. And as you suggested, don't quit, go on as long as you can. So I just wanted to understand the dynamics of this contradiction as well.
Acharya Prashant: Yes. Yes. Wonderful. First, how to determine the purpose. It's actually so simple that we miss it. Let's say you are not to determine your purpose for a purpose. Right now you want to determine your purpose so that you can translate the purpose into a business idea. Now you'll be stuck. Even determining your purpose, be a little purposeless. How? Ask yourself, if I were not considering a business venture, entrepreneurship at this point, what do I see as important in the world today? A freewheeling list, purposeless list.
I do not know what I'll do with this list. I'm not yet to judge that all the items on the list are actually very difficult business ideas to practically execute. I'm not yet to go into that. I'm looking at my condition, at the condition of my people on this planet like an alien. Someone who has no stakes in anything. Very impersonally, neutrally, very dispassionately. I look at everything and then I say, you know, here's the list and it's not difficult at all. If this were an assignment in a course, you would finish it off in like 30 minutes flat or if you can't do it on your own, just ask Chat GPT.
What is it that deserves to be taken up in the world today if I were not to consider the difficulty in bringing the venture to profitability. We'll consider that difficulty later, no? We are equipped with our education and our smartness and all those things. We'll tackle that later. First of all, let me figure out the right challenge to engage with and that's not difficult. That's a matter of general knowledge. So, these are the things I need to get into. Just that we don't take this approach because we already already have a center to start from and that center is how soon will I be profitable.
The problem with that is it's a shared center. It's a center that everybody is carrying which basically means that the calculations you are so busy with are the calculations to be found on everybody's calculator or excel sheets or or those basic software. Everybody's getting into it. So it appears easy, it appears repeatable, it appears secure, but if everybody is doing that, you know of the term crowding out, don't you? You also know that even if there is a great opportunity it won't last for long. In the language of finance, we call it arbitrage. Arbitrage is something that you can avail of only for a fleeting second or a day. A supernormal kind of profit because if it is there then everybody would rush into it, no?
And since everybody would rush into it, nobody would get it. The pi would be divided into so many portions. All you would get is a few molecules maybe, right? And when it comes to the unknown path, obviously when you will do the maths, you might find, well it doesn't look feasible. But remember, you'll benefit from the fact that you are charting out new territory that there is not much competition there. That you don't need to compare yourself against the established giants. In some way, you are planning out a monopoly, a very difficult monopoly, I understand. But then it's not easy on the other side either right?
Postgrads, smart people all, I don't think I need to speak too much on how to do it. You guys are much smarter uh than I am or I was. The problem often is in the starting point itself, the place you start out from. If that can be taken care of.
Questioner A further question about purpose. My name is Isha. I'm a data science and public policy major at Berkeley. And I've been really struggling with this idea of like purpose and balancing like getting a job. You know, my dad kind of tells me, he always tells me you know, in your first right after undergrad, you know, get a job and then for a couple years, 10, 20 years, and then you'll have the money to do the what you want with your life, your purpose. But it feels like I'm waiting for that to happen.
It feels like I have to have money and power to be able to do that. And like at the point where I'll be able to use that, at that point, it's too late cuz I've already missed my peak to do my purpose and fulfill the things I actually want to fulfill. And it's kind of difficult because I understand and I really appreciate your words and that you know we should work towards something and do the things that we're interested in. But it's really hard to manage that when everyone around you is also you know working and making money and they have more power than you because of that. And like how do you have a stake in making an impact if you don't play at the same field and play that same game?
Acharya Prashant: You see we are missing the principle of the dynamic self. If you are to decide that you will work today for the next 10- 20 years and then having amassed enough wealth you will then proceed in the direction of your purpose. You are assuming that the self thinking of these smart things today would remain the same after 20 years. Right? Let's say, you are 25 or 30. Is yourself, the very center of identity today, the same as it was 10 years back? Then why do you suppose that 20 years later you would be the same girl, the same woman? What you get into changes you totally? The self is not one thing. The self is very vulnerable to the environment. It keeps changing. Therefore, one has to be cautious of the surroundings, the company, and the environment one gives to herself.
These mostly remain pipe dreams. I'm getting into something. I wanted to be a writer. I wanted to write something. And I'll do that once I retire. And I'll retire with so much money. I'll buy an island, an entire island for myself and that would be just the right and tranquil place to write a novel at. That's never going to happen. Those are the thoughts of the 25 year old. Those thoughts won't sustain even for a year because you're changing all the time and you are not randomly changing. You have a choice over the way you change.
Once you enter a place, let's say a workplace,it's not just your bank balance that's going to change. Your very self is going to change and we disregard that. We think oh no, you know, we are entering that place, that company, that organization and we know our purpose. We are here to gather some experience, get a few points on the CV, make some money and then I'll exit and then I'll do something else. When the interaction is two-way just as you have your agenda with respect to that company, that company too is going to exert a reciprocal influence on you. You won't remain the same person 6 months into that job. But we think no, we are smart and we'll do as we please and it's our playground. No, no, no. It's a two-way street.
Questioner: How do we know which because if our mind is always changing, how do we know which purposes we're feeling right now to act on without that risk of you get into something that doesn't work out? And how do you balance that rational thought versus exploring? Like we were talking about entrepreneurship.
Acharya Prashant: You surely must be having provision of optional courses in your college, right? Optional, you pick them up. We pick them up for several reasons. At least that's how it used to happen in my time. Mostly we say, you know, this is what would look good on the CV and then we pick it up. Ask yourself if the choice of the course were not to matter on the CV at all, which course would you pick? And that will tell you of your inclination.
And at places like yours, you have a great diversity of options. You can pick up stuff from literature, from arts, from history, from communication, from strategy, everything, you know, everything under the sun. I hope I'm right. Right. That's the way it's at your place. Right. Yeah. That's what we used to admire about the top US institutions when I was doing my MBA. The range of optionals that we had was much smaller compared to what you have.
Now ask yourself now this is the entire basket. Had there been no pressure of any kind, what is it I would have put my finger on and probably that's where our heart beats and it's very important. I'm not coming to you, I repeat with some kind of impractical mystical lecture. I'm all for application of everything that you have learned and you must be very deep, very smart with management principles applications tools everything but that comes later mind you that comes later.
Success is determined less by your proficiency in a particular field of specialization than by your commitment to your conviction. You need to know things for sure, internal things, external things one can never be too sure of. You need to know things with as much surety as possible and then one needs to commit oneself to it. And then all these tools will come handy, then you'll say I'm empowered to now execute my vision. These things are for your empowerment. By these things I mean the education, the courses, the networking everything- all these things are there to empower you to do what you must. These things are not there to dictate to you what you must do and that's a very crucial difference.
You said when everybody around you is doing so well and making money and minting stuff, how does one then stick to what one has thought of? If you are doing really the right thing, it would absorb you so fully. You won't have time to look at others. For many long years you might find you have no interest in what others are doing because what you are doing, your own baby has absorbed and demanded every bit of your time, your energy.
In fact you might find that the others instead are doing some kind of a snoop job. What is she into? Why doesn't she respond to the groups? What exactly has she found? And occasionally you might receive phone calls asking, "So how much are you making?" And you would smile at the very irrelevance of the question. Irrelevant not because you're not making anything, but because that should never be the first question to ask to anybody or the central question.
This is not fiction. I've been through it. I'm coming from there. And then if you happen to achieve material success as well, happen to achieve because that's not your first priority. If you happen to achieve material success as well, all these people whose opinions you are so concerned with today, you might find them lined up to meet you. Because you are, you're doubly ahead of them now. No, you are always ahead of them because you started out from the right place and you're not doubly ahead because you not only started out from the right place but also achieved material success.
And they'll be walking over each other to come to you and talk to you and ask you know how is it? What have you been doing all these years? Where were you? Can we replicate your model?
Questioner: Thank you sir for your response. I think it was very enlightening, especially as a young person. It's hard to hear that sometimes, but I like that there's a sense of hope.
