The Lean Enterprise: How Corporations Can Innovate Like Startups

Chapter 4

Compensation

Entrepreneurs differ from the corporate rank and file in their creativity and independence, but they differ in another, more fundamental way: They're driven by radically different aims. Most employees are motivated by a desire for security, praise, and an opportunity to work on projects that interest them. On the other hand, entrepreneurs are motivated by autonomy and achievement.

Harvard researchers have identified two kinds of entrepreneurs. Some are driven primarily by a desire for autonomy, a need to be in charge with no one to lean on or blame when things go wrong. These people tend to start small businesses such as retail stores and restaurants. The other kind is propelled by a need for great achievement, to found new industries or build huge companies. They raise larger amounts of capital, build more ambitious businesses, and ultimately make a big positive impact on the world around them when they succeed. (They also leave bigger craters when they fail.)

Nonetheless, this second type of entrepreneur is the kind you want to attract and nurture. A rich mythology surrounds such people, but much of it is based on reality. They forego a salary, take up residence in parents' garages, take investments from friends and relatives, run up woeful debts, pitch and pitch and pitch again, refusing to take no for an answer. This is the sort of person who will go through the enormous difficulty of creating new products and bringing them to market.

The Power of the ...