The rapid growth of technology and globalisation has changed the way the marketplace is working. It is making entrepreneurship safer, more accessible and more profitable than ever, leading us to the “End of Jobs.”
Owning your own business, making your own hours, and taking control of your life is now more attainable than ever. Let’s find out why.
You Can Do It
Steve Jobs once said, “Everything around you that you call life was made up by people that were no smarter than you and you can change it, you can influence it, you can build your own things that other people can use. Once you learn that, you’ll never be the same again.”
The ability people have right now to deliberately design their lives and realities is greater than any time in history.
You can design chairs, wine decanters, online courses or even books. James Altucher, a writer and entrepreneur, self-published his book, Choose Yourself, and it sold tens of thousands of copies. That can be you if you want.
To put it simply, entrepreneurship is connecting, creating and inventing systems – be they business, people, ideas, or processes.
Since 1983, the only segment of “jobs” that showed significant growth were “Non-Routine Cognitive Jobs.” In other words, creating systems.
What if job creation – something typically only spoken about politicians or CEOs — is something you, reading this summary, can now do?
Let’s Look at Globalisation
There is a woman named Na in Vietnam. She is trilingual, very smart and hardworking. Her salary is around $1,000/month.
This is true for employees in many countries and regions. India, China, and the Philippines all produce intelligent English speakers that can do good work.
Many people think of outsourcing as blue-collar factory workers, but now it is so much more. Any job that can be done purely over the Internet, even ones that required advanced degrees, can be outsourced for very little money.
With good wifi, you can find, hire, and manage remote workers from anywhere in the world. Platforms like Skype, Google Hangouts and Slack make it incredible easy to communicate with anyone, anywhere.
Technology on the Rise
Many major businesses and industries are being run by software delivered over the internet. We know that technology is playing an increasingly important role in our lives, but what’s surprising is the scale and scope at which it is changing.
Predictions indicate that over the next decade, up to five million people worldwide will own smartphones, giving almost every human on Earth access to the internet whenever they want it.
Technology is taking over. When’s the last time you went to a record store to buy a CD? Services like iTunes, Spotify and Pandora have squashed the demand.
Both the growth of technology and globalisation are continuing at an accelerating rate.
Why MBAs and JDs Can’t Get Jobs
According to the Bureau of Labor Statistics, six years after the recession ended, the unemployment rate was still 11.2%.
Why? Because many of the jobs are going overseas or being replaced by machines.
Even for people with an advanced degree, it is difficult to land a job. Everyone can relate and recognise that there’s a shortage of jobs for highly-credentialed individuals, but no one seems to know why.
The Cynefin framework was developed by Dave Snowden after studying management structure at IMB. It divides work into four categories: complex, complicated, chaotic, and simple.
The simple and complicated can be reduced to step-by-step instructions, which makes them teachable. This is the main focus of our current education system. However, times have changed. It’s not as valuable to understand how to follow directions and implement best practices.
You need to understand the complex and chaotic systems because they are increasingly in demand.
Know Your Limits
Limits play an enormous role in any system, from our day-to-day lives to how economies work.
If you’re trying to grow a business, there’s always a primary limit preventing that. If you have an amazing product and no one knows about it, improving the product won’t help it sell. You need to improve your marketing.
While our first instinct is usually attempting to push harder, it is more valuable to figure out where to push. To figure this out, ask yourself:
1. What’s the system?
2. What’s the current limit?
3. What’s the obvious way to improve the limit?
The limits of the workforce are changing. We aren’t going through a global recession, we’re transitioning between two distinct economic periods. When an economy shifts, investing more heavily in what has always worked won’t improve the outcome. You need to figure out how to improve the limit.
The Emergence of the Entrepreneur
Globalisation means you are no longer competing to be more knowledgeable than the person down the street, but more knowledgeable than seven billion people around the world.
More than half of America’s recent college graduates are either unemployed or working in a job that doesn’t require a bachelor’s degree. Knowledge is no longer the scarce resource it used to be.
Yet the number of college graduates has been increasing steadily since the 1940s. If more college degrees isn’t helping, maybe more entrepreneurship is the secret to success.
We’re at a transition point from knowledge to entrepreneurial work. Those that invest heavily in entrepreneurship will benefit the most.
Entrepreneurship is a skillset that can be acquired, just like acquiring stock in a company or knowledge credentials. There’s no way to measure entrepreneurship, just do what you can to become more entrepreneurial. Innovate, take initiative and take risks.
This is the best time to invest in entrepreneurship. The improving communications technology and educational standards are driving globalisation and moving knowledge jobs, which make it easier and more inexpensive for entrepreneurs to find, hire and manage qualified team members.
Entrepreneurship is more accessible, safer and more profitable than ever before in history.
We frequently avoid making choices not because the outcome is bad, but simply because it’s unknown. But after some reflection, you will realise that the worst case scenario isn’t so bad after all.
Don’t Be A Turkey
A butcher feeds a turkey every day, which leads the turkey to believe that this pattern will continue. It is cared for and fed daily, and it has no reason to believe anything otherwise.
But we know what happens come Thanksgiving Day.
Don’t be a Turkey.
Today, we assume jobs are safe because they’ve always been safe, not because there’s good evidence they will be in the future.
The longer the market goes without having a correction, the larger the correction will be when it happens. The longer we go in our careers and business without variation or randomness, the larger the amount of underlying risk we accumulate.
What was once safe is now risky. What was once risky is now safe.
How Entrepreneurs Are Getting Rich
There are three primary forces of the Long Tail which have driven this shift making entrepreneurship more accessible than ever.
1. The Democratisation of the Tools of Production:
Product creation costs are decreasing. Now, you can make products in China for little money. You can communicate efficiently with the factory. It is cheaper and easier to produce better products.
2. Democratisation of Distribution:
Everyone has a smartphone now. Everyone can reach the market with some effort. There are distribution channels opening up every day. What used to cost thousands of dollars in advertising is now available to you easily and inexpensively.
3. New Markets Are Revealed Every Day:
The internet has changed the rules and new markets and businesses emerge each day. Now, geographical location is irrelevant. You can do business with anyone, anywhere in the world. The creation of new markets means more and more people to sell to.
In short, the internet made it possible to start a business simply by being clever and ambitious.
How to Wade into Entrepreneurship
Successful entrepreneurs have great relationships and valuable skillsets. However, some of the skills you’ll need, you’ll have to learn the hard way – by actually doing them.
You’ll need to learn how to manage contractors and employees and their feelings and emotions, how to deal with and overcome the fear around the launch of a new product or making a sales call.
You’ll also need to learn how to have and maintain relationships with other entrepreneurs. Having an entrepreneurial network will help you immensely.
There are two methods to start a business.
The Stair Step Method
The first step of this method is launching a product that sells for a one-time fee and has a single marketing channel: SEO, paid advertising like Google Adwords, a blog audience, or Amazon.com.
Once you have experience building and launching one product, you can start to expand.
Step two is launching enough products that you can buy back your time.
Step three involves growing your business and launching more products or services.
With this process, you can dip your toes in the water and gradually wade into entrepreneurship. Stair stepping lets you build momentum behind your trajectory by developing the skills you need to run an entrepreneurial company. It also lets you develop relationships.
The other method is apprenticeships. The premise is pretty straightforward: you find someone that is doing what you would like to be doing in five to ten years and make them a deal: I’ll work for you for relatively cheap and in exchange, I get to see the inside of how your business works.
There are many advantages to apprenticeships. You will build relationships and experience. You will be able to examine the market on someone else’s dime. Instead of paying to go to law school or get an MBA, you can get paid to learn skills and build relationships valued by the marketplace.
In summary, technology has made it cheaper to make something, easier to reach markets, and there are new markets willing to buy those things. Entrepreneurship is becoming more accessible just as jobs are becoming more competitive.
Now, entrepreneurship can be invested in more easily than ever.
Money, Freedom and Meaning
Research shows that humans have three core motivators: money, freedom and meaning.
Profit is simply the difference between the consumption and the production of a living thing. An eight-hour workday creates profit that lets you rest the other sixteen hours.
Profit can be divided into two categories: the slow lane –jobs- and the fast lane –entrepreneurship.
In the slow lane, people find a stable job, pay off debt, put in 10% to the market and watch it compound over time. In this model, jobs are fundamentally linked to time. Whether its $600K per year or $8 per hour, your earning capacity is linked to your time.
In the fast lane, the focus is on rapidly building assets that grow without perpetually requiring direct intervention. In this model, exponential growth is possible because they have unlimited control and unlimited variables.
Unlike a job, there is no ceiling. Let’s say you’re in a job and you get a $50,000 raise. That’s great! If you do the same in a business, you add not only $50,000 to your pocket, but also $100,000 in asset value to your net worth because of the multiple.
In order to increase the amount of money any business generates, you must increase the traffic (get more traffic -> sell more units), economics (raise unit price), or conversions (of the visitors we have, more are converted to sales -> sell more units).
All of these factors are fully under your control, and your business can grow as much as you want it to.
Expected value is the sum of all possible values for a random variable, with each value multiplied by its probability of occurrence. It’s how entrepreneurs think about their businesses and decisions. No opportunity is ever guaranteed to happen, but if you systematically pursue opportunities with a positive expected value, you will find success eventually.
You may think that gaining freedom is more difficult, but it doesn’t have to be. It is entirely possible that the freedom you can create in your life will go beyond your wildest imagination. Instead of choosing from a set of available options, create your own.
The entrepreneur defines reality; he is not defined by it. Those that design reality have higher quality of life, freedom and wealth.
Meaning is the third motivator.
Think back to the moments in your life that you were the happiest. What were the moments where you were working so hard on something that you didn’t even notice four hours had flown by? Those are the moments that challenged you and provided you with meaning.
When we spend our time working toward a task that we freely choose, we do better work. It is in the entrepreneurial search for something more that people do their best work.
Money isn’t necessarily our biggest motivator. Meaningful work is. And more meaning often leads to more money.
In 2006, Mark Zuckerberg met with Yahoo investors that were interested in acquiring Facebook.
However, in Zuckerberg’s mind, the only thing he would do with the money was start another social networking site. He liked the one he already had and he found it meaningful to work on it.
Because of this, he declined the deal, and now Facebook’s market capitalisation is over $230 billion dollars.
Meaning not only makes us happier, but it often times makes us wealthier too.
For the first time in human history, the pursuit of money, meaning and freedom through entrepreneurship is more profitable and synergistic than ever before.