The media like to write about the Next Big Thing, compile top visionaries of the year lists and celebrate the leaders of cutting-edge companies as if they can somehow see far into the future. Certainly, innovation is worth recognizing. But the notion of a person coming up with a Big Idea that he or she then turns into a booming business is deserving of another label: The Big Myth. For the most part, that’s just not the way it happens.
Often people are deemed visionaries and businesses revolutionary with little regard to the back story. Pick apart most big successes and you’ll find that no grand vision ever existed. And if it did, the ultimate product or business probably doesn’t resemble it. So if you think you need to find that Big Idea before you set off to build your business, you’ll likely end up doing nothing at all.
Take action, even small steps, and you just might become a celebrated visionary. That’s what happened to Jake Nickell, whose passion has always been art, not business. About a decade ago, Nickell founded Threadless, a t-shirt company based in Chicago. Threadless, of course, doesn’t just print t-shirts. It prints shirts with designs that people submit online and that are then voted on by the Threadless community, which is now 1.2 million strong. It was an idea that could — and now does — work for lots of businesses in this let’s-all-participate-online era: Get others to design your product and that all but guarantee your sales because the community (i.e., customers) votes.
And so in 2005, Nickell, then a 25-year-old college dropout, found himself at MIT’s Sloan School of Management talking to a room packed with b-school profs, high-priced consultants, innovation researchers, and execs from such companies as General Mills and Google. They had come to learn from the young man who had created an entirely new way to innovate. “Apparently,” says Nickell, recalling the day, “the business model was revolutionary.”
If only Nickell had intended to upend the business world, which now uses terms such as “crowdsourcing” and “user innovation” to describe what he was doing. Here’s how Threadless happened: Nickell was a full-time Web designer and part-time student who, in his spare time, used to interact with a group of designers online. When he entered a t-shirt design contest, he sought feedback from the community to help him with his design. He won the contest and thought it would be a fun side project to run his own online t-shirt design contest. He would let others vote on the submissions. Then he would print and sell the winners.
The first contest was a huge hit, so Nickell created the Threadless website and decided to run a contest every week. The first year he sold $20,000 in shirts. The following, sales jumped to $100,000. The Threadless community ballooned as designers trying to win the contest lobbied their friends to vote for them. The winners were paid a small prize — it’s now $2,500 — and got to see their artwork made into shirts. In 2005, the last time Nickell’s company disclosed its revenue, it did $6.5 million in sales. Nickell says the following year, revenue more than doubled, and the company took an undisclosed amount of funding from Insight Venture Partners. Big brands, including Urban Outfitters and Target, wanted to sell the shirts, although Nickell declined.
All that success and praise as a business innovator came at Nickell fast, and he says he started to believe the hype. He even began using the b-school buzzwords to describe Threadless. But Nickell soon realized that trying to live up to visionary status was not just distracting; it was harmful to the business. Hardcore Threadless designers were reading the business articles and started to complain that Threadless had lost its cool and somehow sold out. Scare off the designers, and Threadless’s groundbreaking business model was suddenly broken. “We got caught up in that and started taking ourselves too seriously,” says Nickell. “Now we just think of ourselves as a group of people trying to do something cool.”
Nickell might not be a visionary, but he is a classic entrepreneur. Like most who succeed, he started small and had modest goals. He launched his business in a realm he knew well, and he sought ways to work within his network of associates. Saras Sarasvathy, a business professor at the University of Virginia’s Darden School who studies entrepreneurs, says the process is less the behavior of a visionary and more like the Iron Chef. “You open the fridge, see what’s available, and start cooking,” she says.
In Nickell’s case, he had all of the necessary ingredients at his disposal. He had a community of about 600 customers and designers. He had a friend whose aunt owned a screen-printing shop, so printing and shipping wasn’t a problem. (That friend became a part owner of Threadless.) And he only had to cobble together $1,000 to pay for an accountant, set up the business, and pay for the first batch of shirts.
The benefit of this approach is twofold: Because you’re working within your means and abilities, you’re not taking a great risk. (The notion of entrepreneurs as risk takers is also a myth.) And you find creative ways to work with what you have. “It pushes you into novelty,” says Sarasvathy. “And that way you’re much more likely to come up with a dish that no one has thought of.” A dish, perhaps, that just might be revolutionary.
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by Lindsay Blakely
http://www.bnet.com/2403-13057_23-424810.html?tag=content;col1
