Main Street Entrepreneurship vs The Silicon Valley Lottery Ticket

A classic song by the band “Rush” once proclaimed that being a rock star was “The Universal Dream.” In the 60’s and 70’s this was probably true. But today, all over the world, there are more teenagers who would rather be Mark Zuckerberg or Steve Jobs than they would Bono or Beyonce. Being an entrepreneur is the new universal dream – noting that there are far more entrepreneurs on Forbes’ list of wealthiest than there are rock stars or movie stars.
The Silicon Path
The “Silicon Valley Way” has become the gold standard for the kind of entrepreneurship embodied by contemporary folklore: Come up with a great idea, get venture capital, launch a breakthrough product embraced by billions of people, go IPO, get rich and become an icon and inspiration to others. Consistent with this template, aspiring entrepreneurs are deluged with lessons, recipes and resources on how navigate the Silicon Valley path: how to pitch; how to meet venture capitalists; how to scale, grow, exit and reap the rewards.

For all the hype, legend and movie scripts, the Silicon Valley path to startup success is actually quite rare. Let’s do some math: There’s an incredible amount of venture capital invested – $27 Billion annually – but this money gets parceled out to a mere 3,700 companies, most of them located in Silicon Valley.  And only a paltry 1,900 of these companies are actually new startups.  To put this in perspective – this is about the same number as the number of people each year who win a million dollars in the lottery.  So, if you are a new entrepreneur – particularly if you don’t live in Silicon Valley, New York or Boston – you have a better chance at winning the lottery than you do of attracting venture capital. If the odds are so stacked against this kind of success, then why do so many aspiring entrepreneurs still study and read books on how to build their startup like the Silicon Valley elites?
Mainstream vs Movie Star
During the dotcom boom and post boom eras, the entrepreneurs who attracted millions in venture capital were considered the swashbuckling movie stars of their time. As they graced the covers of the popular magazines, these entre-celebrities inspired a generation of young entrepreneurs to follow the same path. And for most, this path turned out to be the road to futility. Why? Learning the venture capital path is like aspiring to be an actor but instead taking classes on how to negotiate a salary like George Clooney or Tom Cruise. These are the skills and problems of the top 1% of the elite. Learning those skills probably have very little affect on a successful career in films.
Main Street Entrepreneurship

The fact is that there are many paths to entrepreneurial success that don’t involve crafting a company to attract and to please venture capitalists. 99% of the successful new companies each year do so without the help of venture capital, powerpoint pitches and term sheets.
Today, despite Billions in venture capital available, we have a new culture. Bootstrapping is the new “bad-ass” for entrepreneurs. Making it on ‘main street’ is more important these days than appealing to the elites in Silicon Valley. Like being an actor in New York, being an entrepreneur in Silicon Valley used to have that “if you can make it here, you can make it anywhere” feel. But today, appealing to mainstream customers is ‘in’, while learning to pitch to venture capitalists is withering. Making it inside silicon valley is important but not as important as making it on main street. And the savvy entrepreneurs of the post-post-dotcom era understand the difference.