Today’s Guest post is from Saksham Kapoor, the UNSW founder of Recommuso a new music platform which launches soon, signup here to get an invite for the beta program.

If you have a passion for startups and a story or lesson to share, google.

Happy new year to everyone! I hope you enjoyed your break, and are now energised for the year ahead.

In my last post on Startup Passion, I discussed the importance of passion for anyone considering working in the startup sector.

It was my first ever written piece, and I was blown away by the response – it’s great to see that the community understands what’s needed to succeed in the hard life we’ve chosen. Now on to the second order of business.

I’ve already talked about how entrepreneurship is fast becoming the next frontier – startups are becoming the norm, and people are seeking to disrupt seemingly unmovable business models. Not everyone can follow that drive though – commitments come in the way, funding becomes an issue, and people have a mortgage to pay.

That’s where intrapreneurship comes in. Compared to Entrepreneurship, which focusses on developing new technologies or products to disrupt industries, Intrapreneurship is the practice of seeking to disrupt and innovate the internal processes of one’s workplace – through the development of new solutions, streamlining existing processes, or simply challenging the status quo.

Fixing these deficiencies helps the company become more efficient, and ultimately, more profitable.

For a large number of people, coming up with ideas isn’t a problem in itself. Everyone has noticed issues with the way they’re working, ways they’re being inefficient, or plainly, one of the ‘dumbest things’ they’re doing within their firm, and intrapreneurship is an excellent way to work together to solve these issues. It’s the ability to act upon these shortcomings, and develop new and innovative ways of fixing them that set the visionaries apart from the rest of the team.

Lots of companies nowadays deploy some form of an Intrapreneurship program – the most famous example most people would be familiar with would be Google’s 20% time.

Allowing employees to explore their own creativity resulted in the creation of Gmail, AdSense and Google News, which went on to become huge money-spinners for Google.

They were so successful, in fact, that other companies now offer similar programs (Apple’s Blue Sky and LinkedIn’s inCubator come to mind), and they’ve become a key component of tech culture.

Hackathons have also become a viable way for companies to essentially crowdsource innovation ideas (Facebook Hackathons, Deloitte’s HackTheDot), along with dedicated innovation zones (Microsoft’s The Garage, Ericsson’s IdeaBoxes).

With all these opportunities abound, people with great ideas have a fertile ground where they can thrive and explore their creativity. If you have proven experience in a given industry, it’s very likely that larger companies will jump at the opportunity to hire you – employees who are passionate about the company, and skilled enough to implement their passion, are an invaluable asset, and will be far more useful to a company than those who simply show up to work to complete the bare minimum of what’s required of them.

To those who have a burning passion to help make the world a better place, along with the perks of a stable career, intrapreneurship is definitely the way to move forward. Not only will you make kick-ass solutions which could help millions of people all over the world, but you’ll get rewarded internally for it, too!

Leave your comments below on how viable you think Intrapreneurship is and whether it counts as “selling out” compared to the “true entrepreneurs”, and feel free to reach out to me at [email protected] for queries about anything I’ve raised in this post.

Please sign up to Recommuso so we can notify you when we launch.

Ed: This week we will be featuring a number of guest posts from undergraduate students from University of New South Wales who are building real businesses while still studying.

Today’s post is from Luke Marshall, the UNSW founder of Sunapse a Solar Energy Optimisation Software and an active member of the UNSW entrepreneur community.

Luke Marshall winning the Pearcy Awards Student Pitch

Introduction

These days accelerators are a dime a dozen, but it all started with Y Combinator.

You know the story – take a large number of sketchy startups with huge dreams, invest just enough money to keep the founders fed and housed for a few months, and take a small percentage of equity.

Most will fail but one or two will hit it big, and your small percentage of equity will be worth potentially billions. It’s great for everyone – founders get a reasonable deal when equity is expensive and cash is scarce, while investors get the chance to diversify their interests in the startup community and have a small slice of every pie in town.

But what do you do when there are more quality startups than accelerator places? What do you do if your city simply doesn’t have any accelerators, or you are working on a project that doesn’t really fit with what the big players are looking for?

For many, the simple, secretive and slightly embarrassing answer is social welfare.

Let’s get a few things straight first. Legally, you should not be working on a startup if you are on social welfare – in fact, in many parts of the world you can’t even get social benefits if you are the director of a company, no matter how small that company is.

But that doesn’t really stop anyone. I personally have known many startup founders who wouldn’t be where they are today if it wasn’t for government assistance in the early days of their companies.

You may be balking at this. Is an ostensibly pro-business commentator from the startup scene really going to lecture us on the greatness of social welfare?

Yes, he is.

Social welfare is the Y Combinator of the masses.

Think about it this way. Y Combinator, the world’s most famous and successful startup accelerator, works by taking hundreds of entrepreneurs and giving them just enough money to eat and live while they develop their idea. Most of them fail, but a tiny few will go on to do amazing things. This is exactly the role that social welfare plays in the life of many startups – thousands of people following their own risky dreams across the country.

Many in the startup scene glorify the earn-or-starve scenario, arguing that the threat of financial ruin is a brilliant motivator. I don’t doubt it. But the threat of starvation is also a huge disincentive to anyone with a good idea and half a brain.

I would argue that the number of people who miss out on pursuing their ideas out of starvation-avoidance greatly outweighs the small boost a tiny proportion of companies get from the desperate need to prosper immediately or perish. In this sense, we don’t necessarily need welfare to be awarded to founders while they are pursuing their dreams, but just the option in case everything goes pear-shaped. Everyone needs an exit strategy, even those who are dreaming big.

But welfare also plays a critical practical role in the lives of many startups by supporting founders while they find their feet. I would argue that this is a critical factor in boosting serious innovation among entrepreneurs. If you have a situation where startups need to be financially successful in the very short-term or cease immediately, how can any company that requires solid R & D survive, especially in an investment-starved context?

Such an environment incentivises gimmicky startups that do very little innovation, slightly tweaking existing business models to earn a guaranteed buck in the short-term. Good things take time. Cheesy get-rich-quick schemes are not ground-breaking innovation.

In this way welfare can also act as a balancing force in times of economic downturn. If startup funding dries up in a given city, entrepreneurs would be left high and dry without the ability to survive for a short amount of time on welfare. I’m not saying welfare should be comfortable, but I am saying it should be available to everyone, preferably with few strings attached.

When we look at the benefits of welfare for the business startup scene, we see that in many Western countries, our approach to the social safety net is seriously skewed towards traditional careers and employee-employer relationships. Whatever your views on welfare, we have decided as a society to help people who are trying to get a job or an education by providing financial support.

Yet entrepreneurs stand alone in the face of extreme challenges, despite the fact that their actions create jobs and deliver exponentially larger economic benefits. It makes no sense at all.

If what I am arguing is true, it’s reasonable to ask why the US seems to be the spiritual home of entrepreneurship and not, say, Sweden, Denmark, or Norway, the archetypal trio of Scandinavian welfare states? The numbers are in and they don’t look great for small government.

In a NationMaster (http://www.nationmaster.com/country-info/stats/Economy/New-businesses-registered/Number/Per-capita) ranking of countries in terms of the number of new businesses started, these high-taxing, big-government welfare states ranked significantly higher than the US when adjusted for population.

Without a welfare system that can back entrepreneurs, the startup scene will be an inherently bourgeois pursuit, a flippant game of excitement and gimmickry in the lives of the reasonably wealthy on their way to gaining further wealth. That’s not disruptive, that’s not society-changing – that’s a generation of innovators who will be looked over because they simply don’t have the means to begin following their dreams. To me, that’s not right.

It makes sense that if starting a business is less risky, more people will do it. And that means economic and social benefits for everyone. Yes, the welfare system does support people who simply take the money and put it up their nose or down the slot machines.

But that’s not the point. No VC expects all their investments to bear fruit. Y Combinator takes in hundreds of startups every year, with only a few really big success stories. But it’s still worth their while. Without taking a chance, seeding hundreds of people with hundreds of dreams, we wouldn’t have the Apples, the Microsoft’s, the Google’s, the AirBnB’s or the Uber’s of this world. We’d all be worse off.

Let society invest in people who want to make a difference – not every investment pays off, but the odd brilliant success will make it all worthwhile…

You can connect with Luke via his Linkedin Profile

Ed: I believe in a social welfare net for those that lose their jobs or or are generally unable to provide for themselves, however it always struck me how screwed up it was that a millions of our citizens could get various social welfare allowances when they couldn’t find work or while they completed courses at University or TAFE but if you wanted to start a new business you were absolutely on your own.

Its my opinion that there should be an Entrepreneurs allowance equal to either the dole or the AusStudy allowance for 1-2 years to enable entrepreneurs to get a foothold and work out how to build a business. Simply give them enough to pay for a roof over their head and noodles.

In my opinion it would go a lot further than any of the current commercialisation programs in encouraging entrepreneurship across a broad spectrum of the economy and yes it would have failure and yes there would be people who rort the system, but I would argue that those likely to rort the program already know how to do this and they are doing it on existing programs.

It seems to me that neither side of politics is committed to helping people become entrepreneurs, entrepreneurship is missing from our schools despite the continuing trend of decreased full time permanent jobs and increase in part time or casual contract work among western economies.

Photo by Sebastiaan ter Burg

Ed: This week we will be featuring a number of guest posts from undergraduate students from University of New South Wales who are building real businesses while still studying.

Today’s post is from Saksham Kapoor, the UNSW founder of Recommuso

Introduction

You probably know one of them. They could be your brother, your sister, your best friend, your neighbour. Who am I talking about? People who think ‘gosh, I should really start a startup!’ of course.

Having a startup seems to be the ‘in’ thing these days – and with recent exits like WhatsApp ($19bn), Twitch ($1.1bn) and Instagram ($1bn), along with sky-high valuations like Uber ($18bn), Dropbox ($10bn) and Spotify ($4bn), it’s not hard to see why.

To all those people, I say: slow down.

Slow Down

Having a startup isn’t an easy decision. Having worked with two, and having had my own for over a year (Recommuso), I have learnt what sets the true entrepreneurs apart from the ‘wantrepreneurs’.

Coming up with a problem statement, i.e. the pain point you’re trying to solve, is not an easy task, and requires passion for the field/sector you’re targeting. In order to develop the drive for the product, you’ll have to feel strongly about the problem customers are facing, and have a strong desire to solve it.

You want to do as much research as you can (again, you’ll want to be really interested in the sector, otherwise you’ll burn out), looking for anyone else who’s addressing the issue you’re trying to solve. The only two times you should be following through with the idea is if

• No one else is in the space you’re in, or
• There are people in the space you want to play in, but you believe you can do better than them

Next up comes the research and validation. This is one of the hardest parts of the process, requiring you to poke holes in your own hypothesis and solution. Through self-correction and validation, along with the feedback you get from people, you’ll arrive at a conclusion about whether you should be continuing with the project or not.

As you talk to people, you’ll inevitably find that parts you felt were awesome, really aren’t what your customers are looking for.

On the flip side, it may be that something you were intending to drop is exactly what the market wants – keep an open mind. The most important part at this stage is to talk to as many people as you can, and get a good overview of what the market is after.

Most importantly, validate that what you’re trying to solve is a problem in the first place (or, hey, don’t – the iPad single-handedly started the tablet revolution).

And finally, when you’ve got an awesome game plan of what your startup is going to do, comes crunch time: implementation.

Implementation

Implementation is when you get to test whether all your research, networking and hunch are actually what people want, and whether they are willing to pay for it. One of the oldest adages within the sector: the first dollar is the hardest. People will tell you it’s great, it’s revolutionary etc., but until they’re willing to invest in you, it’s not complete validation.

When you’ve got that initial bit of funding, you’ll know you’re on to something. It’s at this stage that you’ll find out whether your passion works out or not, and whether your vision translates into reality.

If the above sounds too difficult, maybe the startup life isn’t for you.

There are lots of online courses (the latest being the excellent How to Start a Startup course by YCombinator) that try to teach you what to expect.

While they may give you the basic knowhow, they can’t instil the one differentiating factor, which sets the successes from the failures: passion.

Passion

That’s got to come from your own drive, and willingness to go above and beyond what is required for success. For people who are unable to commit to the difficulties associated with founding, or being part of a startup, a corporate career may be just as, and possibly more fulfilling.

Taking a startup all the way will require many sacrifices, with the first being quitting your day job in order to free up your own resources for the project. You’ll fail often along the way, and have to be prepared to face the disappointment that what you wanted to create just isn’t working.

For the vast majority of people, that is simply not an option. In my next post, I’ll discuss how those with awesome ideas can use them within a corporate environment, and the pros and cons of doing so.

To clarify: I’m definitely not dissuading anyone reading this from starting their own startup. With my personal experience in the sector, I can say it is one of the most rewarding things you can do.

All I implore is that those who are considering it, to weigh up the pros and cons of going down this path, and ensure that they are willing to commit 100% to their goal. If you feel you’re able to do that, then your passion will help you take your idea to the next stage.

To those of you reading this: feel free to reach out to me at [email protected] for queries about anything I’ve raised in this post and signup to Recommuso so we can notify you when we launch.

Photo by Robert Scoble

James Altucher

James Altucher is an entrepreneur and bestselling author who has founded over 20 companies, failed with most of them but managed some big wins including founding and selling StockPickr and Reset, each selling for approximately $10 million.

James is an Angel investor and was one of the first seed investors in Buddy Media which sold to Salesforce for $745 million and managed to get angel investments in Bit.ly, Ticketfly, CTera, Acebucks, Cancer Genetics and Optimal.

He has published 11 books includingChoose Yourself, 40 Alternatives to College, How to Be The Luckiest Person Alive and is a frequent contributor to publications including The Financial Times, TheStreet.com, TechCrunch and The Huffington Post.

James blogs at The Altucher Confidential, we recommend you sign up for his Insiders List here

When AD broke up with me and cheated on me I thought I would die. I couldn’t breathe. I couldn’t have ideas. I cut loose my friendships. The vault in my chest sealed shut.

Which, of course, brings me to the earthquake of 1906. 10,000 buildings collapsed and fires started to spread all over San Francisco, killing the entire city.

AP Giannini

Amadeo Giannini walked 17 miles from his home in San Mateo to the center of San Francisco. Everyone else was fleeing the other way, trying to outrun the fires and buildings collapsing.

Why would he do that?

He had to reach his business, The Bank of Italy. The first bank dedicated to serving poor immigrants rather than just the needs of the wealthy.

Giannini reached his business, got all the cash and gold and silver and ledgers, put them on his cart, and walked 17 miles to his home.

Then he hid it all and covered it with garbage so nobody could rob him.

He then announced that The Bank of Italy was open for business, the same day as the earthquake. Everyone who was panicking went to him for help. They deposited money.

He then lent out money to anyone who was devoted to rebuilding San Francisco.

What about all the other banks? They thought they did the smart thing. As soon as the earthquake hit they put everything in their vaults.

The vaults then heated up because of the fires. Problem: once you open the doors the hot oxygen would rush inside and set everything on fire: cash, bank ledgers, everything.

So those banks remained closed for at least three weeks.

The only bank open was the Bank of Italy because it’s owner was willing to walk 17 miles back and forth, hide the gold, and take chances on everyone willing to rebuild.

Later, the Bank of Italy was the first bank to risk funding a young man named Walt Disney when he had the idea of a full length animated film, Snow White.

But before that, Amadeo Giannini decided to rename the bank for what it really was – Bank of America, which it’s still called to this day.

Peter Thiel said something that I won’t forget in my interview with him:

You can’t be 10 or 20% better than your competition. You have to be 1000% better.

“If you’re just 20% better, nobody can really tell. They can only tell when you are ten times better. Else nobody will notice you.”

Amadeo Gianinni was 1000% better than everyone else in the aftermath of an earthquake.

When my heart is broken, or I fail at a business, I get afraid to open that vault and let in all of the oxygen, I might go on fire and die!

This is why writing ten ideas a day down is so important. That is why only being with people you love is important. And people who love you.

So you’ll know exactly the moment you need to walk 17 miles when the earthquake hits. So you know not to lock everything in the vault. So you know to be the first to help people. So you know how to help the most people. This is a superhero.

This is how abundance is created.

I want to be the guy who walks the other way when the whole world is falling apart and lighting on fire.

The past doesn’t matter in those moments. It’s been utterly destroyed, desolate and forgotten. Like it is every morning when you wake up. And the future has yet to be rebuilt out of the ashes.

Rebuilt by you.

And, if you let me…by you and me.

James blogs at The Altucher Confidential, we recommend you sign up for his Insiders List here