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Punishing Failure, Stifling Innovation: How Culture Affects Who Goes into Entrepreneurship

I wrote a post last week about some of challenges facing Chilean would-be entrepreneurs because of the culture.  Overall, Chilean culture punishes failure, which stifles innovation.

It got me thinking and I realized that it seems to me that a fixed percentage of people in the world are entrepreneurial.  I’m not sure what the exact number is but if I had to guess, it’s probably around 10% and I’d be willing to bet that percentage is fairly static across the world.  I believe that these 10% have the skills, desire and entrepreneurial spirit to start a business and succeed.  10% of Americans, Saudis, Chileans, Spaniards and South Africans all have the desire to start businesses, so why do some places have lots of entrepreneurship and others don’t?

Why does the US have a higher percentage of entrepreneurs than Chile, Saudi Arabia or other places around the world.  And in the US why do Silicon Valley, NYC, Austin, Boulder and Boston have a higher percentage of entrepreneurs compared to Des Moines, Tallahassee and Phoenix?

I believe that certain cultural values free up the entrepreneurial 10% to actually start businesses and succeed.  For example, in the United States, we reward risk taking, business ownership and making money.  On average, we also love innovation, learning and trying new things.  We love rags to riches stories, even if they are only partly true.  If someone’s business fails, it’s seen as experience, not a black mark.  In the US, these values are stronger in San Francisco and Austin than in Cleveland and Memphis.

In other parts of the world, there are many different cultural pressures that stifle innovation: punishing failure, punishing innovation, closed culture.  Some places even look down on successful people.

In Silicon Valley, I bet 20% of the people are entrepreneurs in some way shape or form.  In Austin, maybe 8%.  In Chile it’s .01%.  I believe that all cultures start out with the same 10% who can start businesses, but some cultures push people who may not have started businesses to do it, while others push people who would have otherwise started a business to shy away.  The most important thing entrepreneurs, government and academics can do is to try to free the people who would start a business, but don’t because of cultural pressures.

I’ve seen it first hand in Madison.  When I was 19 and just starting with ExchangeHut, there were not many young entrepreneurs.  I only knew 4-5 students and recent grads who were starting businesses.  After JellyFish sold to Microsoft, Networked Insights started to have some success and young entrepreneurs like those in the Burrill Business Plan Competition started to get press in national publications and have some success, other people started to see that they too could start a business.  Capital Entrepreneurs has accelerated the process, along with all sorts of cool initiatives from the startup community like barcamp, forward tech festival, high tech happy hour and more.  I think Madison went from a 1% to a 3% city in the last five years.  We still have a long way to go, but by unlocking the pent up entrepreneurial talent, we’ve seen an explosion in entrepreneurship.  Just wait until we see what Madison looks like at 5%!

In Chile, I’d estimate that we’re at .1%: for every 1000 people who are entrepreneurs at heart, only 1 starts a business.  That’s 1/1000!  In Silicon Valley, it’s probably 200/1000, Austin 80/1000 and so on.

Part of Start-Up Chile‘s mission is to introduce entrepreneurs from all over the world into Chile’s culture to try to break the cultural pressures that punish failure and stifle innovation.  I believe that we should be focusing on the other 9.9% of Chileans who might start a business if they were not afraid of being punished for their failure.  If we can double the amount of entrepreneurs who start businesses, it will be a huge win for Chile.  I see similar parallels to Madison and the entrepreneurial community is starting to take shape.  People just need the entrepreneurial push!

What do you think?  Are entrepreneurs distributed equally across the world or are more entrepreneurs born in one country compared to another?  What can you do to help free up the rest of the entrepreneurs who are scared to make the leap?

Russia, Qatar Show FIFA’s Corruption

Sepp Blatter: Bond Villain Look Alike
Nobody should be surprised by FIFA’s selection of Russia and Qatar as the next two hosts for the World Cup.  FIFA, along with the International Olympic Committee are among the most corrupt organizations in the world (see Jack Warner).  It’s clear that England was by far the best host for 2018 in terms of attendance, overall revenue and atmosphere.  A world cup in England would have rivaled Germany in 2006, but it’s clear that’s not what FIFA wants.

I don’t buy FIFA’s insistence that they’re trying to spread the game around the world.  All they are about is pulling off a decent tournament and getting rich themselves.  Before the final vote, FIFA president and Bond villain lookalike Sepp Blatter spoke of the “evils of the media,” referring to a British press investigation that caused 6 delegates to resign amid corruption charges.  According to the head of England’s bid delegation:

Robertson said: “One of the rumours sweeping Zurich last night was that there are 22 Fifa exco delegates as you know, and the rumour was that only three of them bothered to call for the technical reports and two of those bothered to call for those technical reports so they could release them to their own bid teams. If you have 22 exco members and they’re not bothering to read the technical reports, I think that probably tells you it’s not a football-based decision.”

At a news conference in Zurich Anson, asked if England should bid to host the tournament again, said: “I would say right now, ‘Don’t bother until you know that the process is going to change to allow bids like ours [a chance] to win. When you have the best technical bid, fantastic inspection visits, the best economic report, and, from what people told us, the best presentation, it’s quite hard to stomach that all that seemed to count for absolutely nothing.

“Having only 22 guys only voting gives them too much influence. Running two bids together was clearly a huge mistake. Everyone who had a vote and a bid clearly wanted to trade that vote for something that helped them get over the line in that campaign. Australia had a very good bid and they got one vote, we had a very good bid and we got two, the USA had an unbelievably strong technical bid and got three. Six votes in the first round between those three, there’s something not quite right.

“You have to open it up to all member associations and have transparency and open voting so everyone knows who voted for whom. With 22 guys having so much power it becomes very, very difficult.”

Wikileaks recently revealed a cable calling Russia a mafia state, so it’s no stretch that their government/oligarchs/mafia found a way to funnel into FIFA’s welcoming hands.  I actually think Russia will host a fairly good tournament, just like South Africa did, especially if they do the grouping so that you don’t have to travel huge distances.  Russia has good night life and the climate will be great for a summer tournament, but I think FIFA took personal gain over the potential to have one of the best tournaments ever.

Qatar is another story.  They have oil money and want to get on the world stage.  Again, it’s no stretch that they were able to funnel some into FIFA’s open arms.  I just don’t see how Qatar will be able to host a decent tournament in June and July.  I know they’ll have air conditioned stadiums, but the best part of the tournament is seeing the country and hanging out with people from all over the world.  With temperatures peaking at 50C, I can’t see it being very fun.  A Qatar travel site says “anyone who can leave Qatar in the summer does.”  Add in the fact that it’s close to terrorist hotspots and doesn’t allow Israelis to enter, I can’t see Qatar being able to pull off a really fun World Cup.  I understand why the US didn’t get it since we just hosted in 1994, but Australia would have been a really good choice, too.

FIFA delegates may not have accepted bribes (I think they did, but I don’t have evidence), but FIFA has other reasons for picking developing countries. In South Africa, FIFA basically rented the country out for 6 weeks.  They got the government to change laws and make new ones to restrict advertising.  They got South Africa to allow “blue lights” to drive as fast as they wanted and ignore traffic laws, and even got the police and organizing committee to sweep all sorts of misdeeds under the rug.  See my post about FIFA’s corruption from July for more details.

The last World Cups have been held in South Africa, Brazil, Russia and Qatar, all developing countries without extremely strong rule of law.  All four are willing to sacrifice rule of law for the chance to be on the world stage.  I’m not sure that I blame them either.  I just don’t think we’re likely to see a World Cup or Olympics in a developed country any time soon.  Sepp Blatter FIFA would rather take money and make their own rules, far away from the prying eyes of the British or American press.

Travelogue Cape Town: Five Days During the 2010 World Cup

Note: This is the fourth in a series of posts about my experiences at the 2010 FIFA World Cup in South Africa. You can read the first post, Twenty Days in South Africa for the World Cup, to get an overview of what we did while we were there and the second post is about the soccer and the third post about is five days in Durban, the fourth post is about my safari in Madikwe Nature Reserve.   This post is about five days in Cape Town.  I realized that I had written a post about my trip to Cape Town, but somehow didn’t put it live until now.  Oops.

We flew into Cape Town the day after the US beat Algeria on a last second goal in Pretoria and on a huge high.  The flight into the Cape Town airport is beautiful.  It was a clear day and we were able to see Table Mountain with Cape Town spilling downhill toward the clear blue ocean.  We got our bags and drove toward the city.  In Pretoria, the woman who owned the bed and breakfast referred us to her friend who runs a guest house in Cape Town.  As we got closer, we realized that we were staying at the foot of Table Mountain, with amazing views of the city.

Cape Town Harbor, Table Mountain in Background

The first night, we drove down to the harbor and took in the scene.  The Netherlands were playing Cameroon and the entire harbor was orange.  Many white South Africans have Dutch ancestry and were supporting the Oranje, so it was a really fun scene.  We watched Italy lose to Slovakia in a packed restaurant with amazing harbor/table mountain views and then I walked over toward the stadium to buy a ticket.  I ended up getting a ticket right on the midfield stripe for face value.  Green Point stadium was beautiful and the game, although meaningless, was really fun.

The next day, I went to an Internet cafe and tried to find out how much it would cost me to fly to Rustenburg to see the USA vs. Ghana round of 16 match and found a cheap flight/car rental.  It was too good to pass up, so I made plans to leave Andy and Katie later that night and flew to Joburg with my sleeping bag, USA gear and enough money to buy a ticket at one of the bars.

Before I left, we climbed Cape Town’s iconic Table Mountain.  It was a tougher hike than I thought it would be, but completely worth it.  Although it was a little cloudy when we got to the top, you could see Cape Town on one side and the Cape of Good Hope on the other.  We could see the huge waves crashing into the Cape from both sides of the Atlantic and Indian oceans even though we were miles away and a few thousand feet up.

Top of Table Mountain, Overlooking Cape Town

In the airport, I met two other Americans who had the same plan.  We ended up hanging out the entire time and it was a great time and completely worth it, even though the US lost in extra time.  I flew back to Cape Town the next day and Andy and Katie were waiting for me with a picnic they had prepared from a local farmers market.  We decided to drive around the Cape, while taking a break for lunch to watch the Germany/England match.

We drove to Camps Bay, Hout Bay, Simon Town, Kalk Bay and all of the little towns along the coast.  Each had a different feel and different geography.  It was a beautiful drive, highlighted by penguins and an amazing sunset over Hout Bay.  We went back to our apartment and walked down to a neighborhood bar to watch the night game, ending an awesome day.

Penguins!

The next day, we went out to wine country.  Cape Town and the surrounding areas, including Stellenbosch, produce some of the best wines in the world and we spent the day going from winery to winery sampling the best.  Cape Town’s wine country is beautiful and very close together.  We went to 5-6 wineries and then ended the night in Stellenbosch, which seemed like it was South Africa’s version of Madison.

Wine Tasting

Our last day in Cape Town, it pored.  We went to Bo-Kaap, which is a high area overlooking the city.  It is hope to mostly Cape Malays, which are the descendants of Dutch imported Indonesian slaves in from the 1600-1800s.  We had a great meal overlooking the city and then explored a spice shop where we bought some awesome curry spices to bring back to the US.  My favorite was “mother in law curry” which was their hottest.  I’ve cooked with it a bunch of times since I’ve been back and it’s one of the better curry blends I’ve tasted.  Bo-Kaap is also home to the iconic multicolored houses that Cape Town is famous for.  After our trip to the Bo-Kaap, we drove to the airport to start our 34 our journey home via Dubai and New York.  Cape Town was one of the highlights of our trip and I’d love to come back some day.

Sunset, Looking South

Travelogue: Safari at Madikwe Nature Reserve

Note: This is the fourth in a series of posts about my experiences at the 2010 FIFA World Cup in South Africa. You can read the first post, Twenty Days in South Africa for the World Cup, to get an overview of what we did while we were there and the second post is about the soccer and the third post about is five days in Durban. This post is about my safari in Madikwe Nature Reserve.

Between USA/Slovenia and USA/Algeria, we drove up to Madikwe Nature Reserve for a three day safari.  We booked online just before we left, so we didn’t really know what to expect, but all three of us were excited to see some animals.  We were happy that we’d gotten a discount from the official rates and it was about a 4 hour drive from Pretoria, so we left fairly early in the morning and drove northwest, via Rustenburg.

We arrived at Madikwe, which is about 15k from Gaborone, the capital of Botswana and entered the park.  There are three types of reserves in South Africa and three different types of safaris.  There are national parks like the famous Kruger National Park or the newer Pilanesberg, which allow anyone to drive around the reserve in their own cars in search of animals.  There are also private reserves that are generally much smaller and are owned by companies that feel that they can make a profit from safaris.  Madikwe is a public/private combination of the two, in that the land is owned by the government, but private companies were allowed to build accommodations in small areas of the park.  You also must be accompanied by a guide at all times in Madiwke, so there is much less traffic than in Kruger or Pilanesburg.

Elephants at Bush House Watering Hole

We got to the park and made our way to The Bush House, a few km inside the park, just off the main road.  We really didn’t know what to expect, but we were greeted by friendly staff and luxury accommodations.  The first day, the three of us were the only people staying at The Bush House out of a possible 12, so we basically had a private, luxury safari for a day.  The Bush House is in the wild, surrounded by electric fence to keep the animals out and guests safe.  In addition to luxury accommodation, they have a watering hole that is right outside the fence, where you can watch animals come take a drink when you’re not out in the park.

Each day, we would get up at 7am and do a 3.5 hour safari with our guide, Jason.  After about 2 hours, we would stop for coffee and tea and then cruise around for awhile longer.  When we got back, breakfast would be ready for us outside in the breezeway.  We had the next few hours to ourselves, then had “afternoon tea” which was really like a lunch at 230, before another 3.5 hour safari that included drinks at sundown and 30 minutes or so of night safari.  When we got back, dinner was ready for us.  We were there for three full days and the entire experience was completely worth it.

It is winter in South Africa, so it gets really cold at night.  During the day, it was comfortable to walk around in shorts and a tshirt, but as soon as the sun went down the temperature would drop from about 70 to about 40 in twenty minutes.  We made sure to bundle up for the morning and night safaris because it was frigid, but it was completely worth it.

Giraffe on Safari

Our first game drive started out slowly our first afternoon, but it was fun to be in the bush, looking around hoping to see the big 5 (lion, elephant, buffalo, rhino and leopard).  We saw a bunch of antelope and wildebeest and continued to drive around.  Our guide got a call on his radio that there had been a sighting in another part of the park, so we drove that way.  He pulled off one of the dirt tracks and all of the sudden, we were 10 feet from two sleeping lions.  The guides use radios to share sightings between each other, but Madikwe has a cool rule that only allows 3 vehicles to be at a sighting at once.  Other parks have no limit and cars crowd around the animals, which doesn’t seem fun or safe for the animals.

20 feet from a lion

I was continually suprised at how close we could get to the animals without them running off or us being in danger.  Our guide told us that the animals view the vehicle as one big blob, which looks dangerous to them, so they do not want to attack or show interest.  He also told us that as far as he knew, there has never been a case of a lion grabbing a human off of a vehicle before.  We never really felt in any danger, but was a little disconcerting to be 30 yards from three rhinos who continued to stare us down.

Sundowner drinks/snacks in Madiwke with our vehicle

Speaking of rhinos, they look like they are from a different time and place.  They look prehistoric and you can really tell they’ve been on earth for a really long time.  They’re also incredibly wide.  I’ve seen rhinos in the zoo before, but they’re always just sitting around in their enclosure.  Seeing these huge creatures in the wild was completely different.  They are the ones in control, not you.  We also learned that the guides do not talk about rhinos over the radio because poachers have been very active in killing rhinos for their horns.  There are only about 6000 rhino left in South Africa and over 125 had been killed already in 2010.  A full grown rhino horn is worth close to $1m because mostly Asian cultures want them for either rhino horn knives, which are used in coming of age ceremonies, or to be ground up and snorted or eaten as an aphrodisiac.  On our second to last day in South Africa, there was a story in the Cape Town paper about a rhino that was brutally attacked with a chainsaw for it horn.  It’s an incredibly sad and unfortunately growing problem, even on the nature reserves.  Madikwe has not had any poacher problems yet, but they are constantly vigilant to prevent rhinos from being hunted to extinction.

Three rhino

After seeing the rhinos, we got back to the Bush House and dinner was waiting for us in front of a roaring fire.  It felt great to get out of the freezing cold and the meal didn’t disappoint.  We had ostrich steak and lamb chops, accompanied by potato and leak soup, which were both really good.

The next morning, we got up for another game drive.  We drove into a more mountainous region of the park and ran into a group of 8 giraffe.  Giraffe are under appreciated animals, but I think they might be my favorite.  They’re huge, but we were able to get within 10 yards of them.  I didn’t realize that they have cones on the top of their heads that they use to fight and defend themselves.  Our guide told us that the males have much bigger cones and the older ones generally have broken cones from all of the fighting they do.  During mating season, the males fight to show dominance and apparently a giraffe fight is really brutal, with the loser dying of concussions or a broken jaw from time to time.  The males also get darker as they age, mostly to show dominance.  Again, seeing giraffes in the wild is a completely different experience from seeing them in a zoo where they just sort of stand around.

Right after the giraffes, we spotted one elephant on the side of the mountain.  After stopping to take some photos, we realized that there were a ton more coming down from the hills.  Elephant go up into the hills at night and then come down to eat when the sun comes up.  We quickly found ourselves in the middle of a group of 50-60 elephant, including a bunch of babies.  The babies are pretty funny, because they can’t use their trunks yet.  They try, but they sort of just dangle there, useless.  Elephants learn to use their trunks after 6-12 months, but have trouble until then.

These elephants were huge.  They were so much bigger than the mostly Asian elephants I’d see in zoos.  We were close enough to smell them and hear their vocalizations.  The younger males, 10-12 years old, are sort of like human teenagers.  They think they’re invincible and are really interested in the opposite sex.  They start to cause trouble and then a senior male, usually 45-55 years old, disciplines them.  Once the young male learns his lesson, the older male mentors the young one, teaching him how to interact with females, other animals and how to behave.  We were told that in areas with lots of poaching, the young males miss out on this mentoring and then don’t know how to interact with females or other animals and cause trouble, many times leading to them having to be put down.  Elephants live into their 60s and their lives parallel humans.  It’s amazing how far the parallels actually go.

View from the room, the bush house

That night, more people came, so our private safari was over, but it was still really fun.  They didn’t believe us that it got cold at night, so they froze the first night.  We ended up finding a large pride of lion, with over 10 lions in it.  After watching them for awhile, we noticed the younger cubs wandering off, so we went to find them.  On the other side of the hill, we saw all four of them getting the last of the afternoon sun in what looks like a staged picture, but I can assure you is not.  After dark, we saw two lions hunting and heard the shrieks of antelopes, but the lions didn’t catch them.  The lions were huge and slinking through the tall grass.

The next day, we saw a ton of zebra and went in search of wild dog, but didn’t find them.  Instead, we stumbled on a herd of 250+ buffalo.  They were huge and their horns looked like they could do some serious damage.  Our guide told us that buffalo are the most dangerous of the big five because they are so smart.  He said that he’s heard stories of buffalo that are shot by hunters that double back and attack the hunter from the rear to kill them.  Later that day, we saw the only cheetah on the reserve.  There used to be 60 cheetah, but the lions killed them all.  The park is trying to move 15-20 of the lions and then reintroduce more cheetah.  Our guide had been in the park for 6 months or so and had never seen the cheetah, so we were fortunate.  We were also fortunate to see two male lions eating a freshly killed wildebeest from really close up.

It was amazing how much all of the animals blended into the landscape, especially the lions and cheetah.  I had always thought of lions are yellowish and probably had a bad picture of cheetahs in my mind because of the cheetos guy, but both are almost light brown and really hard to see.  I could easily imagine walking right up onto a lion without even knowing it.

I really enjoyed the three days on safari.  Besides the matches, it was the highlight of my trip to South Africa.  Seeing these huge animals in the wild is a completely different experience than seeing them in the zoo.  If you go to Africa, you must go on safari.  It’s really not that expensive.  If you do choose to do a safari, I really recommend Madikwe and the Bush House based on value for money and all of the animals we saw.