Developing the Entrepreneurial Mindset
Lead Author(s): Mike Green
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A homework assignment on entrepreneurial mindset by Mike Green.
This content is licensed under the Creative Commons Attribution 4.0 International License.
DEVELOPING THE ENTREPRENEURIAL MINDSET
The twenty-first century ushered in an era of rapidly evolving new technologies and disruptions of consumer behavior across all industries. New entrepreneurial opportunities were born amid the chaos of industry responses. Barriers to entry were lowered or obliterated. New, fast, and nimble competitors entered the markets. And a new economic paradigm was introduced to media companies that would leave many print news organizations struggling.
On the employee level, industry disruptions have changed what a career means. Since 2004, the industry has contracted 37 percent, from more than 65,000 reporters and editors employed in 2004 to just 41,400 in 2015 (the last year of available data collected by Pew Research and published June 1, 2017).3 Behind those data is deeper insight; Pew Research will need to gather information for the next publishing cycle because the News Media Alliance (NMA), formerly Newspaper Association of America (NAA), can no longer supply it.4 Accurate industry research is another victim of the industry-wide upheaval.
No one can expect to get hired anywhere in the country and work for the same company for most of their careers until retirement. That’s a twentieth-century concept rendered obsolete in the first decade of the twenty-first. For media, this is especially true.
Dog Eat Dog
Buying and selling of media companies is consolidating the landscape. The plummeting value of major media properties, like the 140-year-old Washington Post (founded in 1877) that sold for $250 million5 in 2013, can result in a sale for less than digital newcomers like Huffington Post. Huffington Post was born in 2005 and sold for $315 million6 to AOL in 2011.
While the Graham family nurtured a multigenerational national media operation for about 68 years that was built on a foundation of award-winning journalism, Arianna Huffington started a blog and generated more market value from it in six years than the Graham family
View data and charts1 from Pew Research Center’s Newspapers Fact Sheet, part of its State of the News Media report. The Media Deserts Project2 also has maps showing the decline of local newspapers in various regions.
could manage from the Washington Post in decades. In case you’re inclined to think AOL overpaid for Huffington Post, last year the telecom company Verizon bought AOL and all of its media properties for $4.4 billion. By contrast, The New York Times Company was worth $1.8 billion7 on the market at the time AOL was purchased. Meanwhile, startup media company Vox, at fourteen years old, was valued at $1 billion in late 2016.8 Today, AT&T hovers over Time Warner (which owns CNN) waiting for the government to approve its $85 billion offer.9
The media industry has changed, and journalism is changing too. Gone are the days of college grads cutting teeth at the local level and honing their reporting chops before embarking on a series of tours, from low-wage local jobs to regional, and up the career ladder to higher pay with national news chains. Gone too, is the wall of demarcation that divided the production of editorial news content from the business of operating a media company.
Local media used to be the trusted place where consumers learned about their schools, city council, sports teams, and happenings in their community. But the consolidation of media across the nation has reached the local level. And corporate ownership of local media has ramifications for journalists. Sinclair Broadcast Group is on the verge of purchasing10 the Tribune Media Company this year. This purchase is sending tremors across the media landscape due to its size and scope.
Before the Sinclair deal can be confirmed, allegations11 of political bias by the company have been raised. These include requiring stations to carry “must run” segments produced by the corporation and mandatory insertions of political commentary into local news broadcasts. The ability of corporations to purchase media in local markets in bundles is having an impact on the integrity of the journalism profession. The evolution of the industry, as it is being disrupted by new media and new players, introduces uncertainty in the media market and changes the dynamic of the career trajectory for journalists entering the profession.
Death of Past; Birth of Future
Newspaper Death Watch12 keeps tabs on the decline of the news industry, noting that 15 major city dailies have shuttered since NDW started tracking in 2007. The loss of 15 major daily newspapers in the past 10 years doesn’t inspire confidence in the future of the media industry. Lying in the grave alongside those relics are also notions that journalists are dispassionate objective observers, set apart from the communities they serve. Gone too is the standard of objective robotic reporting. The way journalism will be conducted in the future will look different than it did during the past century.
It’s important to note: journalism is not dead.
The craft and industry are evolving. And technology is playing a key role in that evolution. Both the media industry and its truth-seeking, storytelling, content-producing members will continue to play a vital role in society. However, the double-digit profits that made the
former newspaper landscape an influential and prosperous “Fourth Estate” have evaporated along with the attention span of audiences. The sudden disappearance of financial scaffolding provided by the advertising industry, which enabled the profession of journalism to grow, has caused the collapse of media companies and the loss of thousands of journalism jobs.
Today, even under the recent renewed interest in journalism that national newspapers are seeing due to the public’s concerns with “fake news,” the media industry is racing to keep up with technologies and new consumer behavior that have transformed a centuries-old U.S. industry in a decade. And the most unnerving revelation of all is that this new era of tech- innovation driving the evolution of media is in its infancy.
Journalists who wish to survive in this new era must think beyond the boundaries of an employee performing tasks for an employer. The industry is filled with underpaid and overworked professionals who do their best work because of their love for journalism and service to the public. Ironically, it is this passion and love for the work that fits in the next phase of journalism in the twenty-first century.
Today, journalists must consider themselves as more than masters of their craft, whether they are writers and editors, photographers and videographers, television producers or newsroom managers. Every journalist who intends to make media and/or journalism a career must consider their role as either an intrapreneur or entrepreneur.
These terms are so important that we’ll define them here.
An entrepreneur is someone with a market-driven pursuit of a conceptual idea, who seeks a viable business model that succeeds in a target market.
An intrapreneur is an employee who innovates and thinks entrepreneurially to develop new lines of business, programs or products within an existing organization or corporation.
It is important to understand how and why the era of entrepreneurship arrived and will remain. The national economy has transformed itself three times over the past 100 years. America was once a profitable agrarian economy and land ownership was the key to prosperity in the nineteenth century. With overseas wars in the twentieth century came the need for mass production and an evolution of America into a manufacturing economy. Ownership of a factory and the means to production was a pathway to wealth. Manufacturing included the production and dissemination of information as news. And journalists were needed to gather, edit, and produce the content.
With the introduction of venture capital investing as an industry in the late 1960s, the buying and selling of businesses became a profession by the late 1990s. Another evolution of the U.S. economy occurred. America had given birth to a creative, knowledge-based, tech-driven innovation economy.
By the turn of the twenty-first century, this “new economy” (as it was initially called; today it is known as the “innovation economy”) began to reward disruptive ideas in the marketplace, and the marketplace is global. With the advent of the Internet and collaborative technologies that continue to emerge from global connectivity, the age of information exploded.
Investors began to view the growth of teams of entrepreneurs starting their own companies as high-risk, high-reward opportunities for investing capital. This kind of direct investment into a young company is rewarded in an exchange for a portion of ownership. When the company grows and attracts buyers, the investors will get their share of the purchase depending on the percentage of shares they own in the company. This direct investing into startup companies, typically by angel investors13 (individuals and/or groups who invest their personal funds), accounted for more than $21 billion in 2016, according to the Center for Venture Research.14
One of the major impacts upon the media industry since the turn of the century was the number of digital media startups,15 fueled by money from investors and venture capitalists. Niche markets were targeted by new digital platforms such as Techcrunch, Venturebeat, Mashable, ReadWriteWeb, and others leveraging the power of journalism to cover new areas of the economy. In addition, journalists, laid off from their legacy media jobs, started hyperlocal online news sites, small geographic regions where they focused the news on a zip code, neighborhood, or city/town. These hyperlocals were bootstrapped startups, for the most part, that relied on self-funding, or friends and family to start. CJR maintains a database16 of such sites. With the growth of mobile usage, mobile applications and other new technologies in the hands of consumers, the need for content has exploded17 over the past few years. Adding to that explosion are new technologies such as virtual reality (immersive) and augmented reality (blended real and imagined). Learn the difference.18 These new platforms require the skill of storytellers to produce content that engages consumers.
The hope of getting money from investors is one of the drivers that’s motivating creative storytelling solutions. But entrepreneurship isn’t only about chasing those dollars, but rather pursuing the journey of giving the industry a solution based upon an innovation. However, without startup funding, ideas can die in the minds of innovators. The age of startup companies was fueled by laptops, tablets, smartphones, and software apps that keep making it easier for anyone with a connection to the Internet to develop a website to get their idea into the marketplace quickly.
Media was one of the first industries to feel the disruption of fast-paced, tech-driven production, and dissemination of information in the hands of millions of people. The ability of almost anyone with a computer, software, and the Internet to produce the written and spoken word, photos and video, and upload it to the world to consume became a challenge to the
media industry. Industry executives learned that anyone with a blog, a comment, or a tweet on the Internet could compete with the journalism profession for attention of the masses. Yet, that was the reality. A YouTube star19 could be born in the bedroom of any home. And media would have yet another player in the market competing for attention in a 24-hour daily cycle.
That initial recoiling by media was a mistake. It opened the door to early adopters of new publishing platforms, and the race was on to grab market share in the digital space. While media companies challenged the quality and accuracy of content being produced in America’s basements, bedrooms, and garages nationwide, entrepreneurial ventures developed as digital media platforms for this content. Since the turn of the century, hundreds of media platforms have entered the market to compete with the “legacy” media. Ironically, social media platforms like Google and Facebook understood the power of online engagement with audiences long before legacy media began to switch their business model from print distribution of news products to invest in development of digital platforms that encourage audience participation versus passive consumption.
Entrepreneur or Intrapreneur?
Journalists eventually began to understand the power they had to establish a brand, develop a platform, and connect with an audience. And, as the media industry contracted, journalists turned to entrepreneurship, as self-employed freelancers and CEOs of new media ventures.
Former CBS News anchor Dan Rather now produces content for his News & Guts20 platform. Former CNN news anchor Soledad O’Brien produced the series Black in America, which aired on CNN. When she was fired in 2013, she took the series with her. O’Brien had established a brand of matter-of-fact journalism during her career at MSNBC, CNN, Al Jazeera America, and HBO. After CNN, she transitioned from journalist to founder and CEO of Starfish Media,21 where she retains ownership of her brand and continues to produce content for broadcast media, like HBO and her own platform, MatterofFact.tv.22
Of course, not everyone is able to be the CEO of their own company. But in this era of innovation, there are no guarantees of a twenty- or thirty-year career with one employer or even in one industry. Even those who fear entrepreneurship must learn to think like an entrepreneur while serving as an employee. An employee with an entrepreneurial mindset is known as an intrapreneur. And these are the most valued and coveted kinds of employees. Let’s take a look at the definition of an entrepreneur and examine why employees prefer intrapreneurs.
“Entrepreneurship is the pursuit of opportunity beyond resources currently controlled,” said Johnathan Holifield, former NFL player, attorney and author of the critically acclaimed book, The Future Economy and Inclusive Competitiveness.23 “That’s how Harvard professor Howard Stevenson describes it, which underscores my own passion for it. Entrepreneurship is about the relentless pursuit of opportunity that results in business formation, educational attainment and everything else worth having.24
Simply put, entrepreneurs are innovators. They are creative problem-solvers, critical thinkers, collaborators, and calculated risk-takers. They are sacrificial, tenacious, motivated, and driven toward measurable outcomes. They are team players and team leaders. Entrepreneurs pursue their goals with passion and determination to succeed, despite obstacles.
An entrepreneur is someone with a market-driven pursuit of a conceptual idea, who seeks a viable business model that succeeds in a target market.
Social entrepreneurs are a unique type in that they seek to introduce solutions into the marketplace that produce both profit and measurable social impact.
The entrepreneur is engaged in a process of creating, innovating, monitoring, measuring, tweaking, pivoting25 (shifting strategy when necessary) ... and all the while searching for a formula that delivers market adoption with a desired return on investment.
Contrary to the experimental world of the entrepreneur, a business owner is managing the operations of a proven business model. One example is becoming a business owner through purchase of a franchise operation and getting the training to run it based on an established model for that business. While this approach still contains a certain amount of risk, the experience of the franchise corporation helps reduce the risk of the investment made by the franchisee owner to offer a more solid foundation from which to launch. Learn more26 about the difference between an entrepreneur and business owner.
Of course, entrepreneurs don’t necessarily make good business owners and managers. Given their penchant and passion for creativity and constant search for a business model that works, too often startup CEOs who are stuck in the mindset of the entrepreneur find themselves tweaking a business that doesn’t need it. This is a problem venture capital investors find in some startups that have successfully penetrated a market and competed for a share of it.
Investors who write multimillion dollar checks to provide the company enough cash for it to grow will often ask the startup CEO to step aside and assume a different role in their own company. This is due to the need for the CEO to manage the process of scaling up the company based on the successful business model. The former CEO, who still yearns to innovate, can do so within the company without detracting from the core business model. Thus, he or she is now in the position of being an employee with an entrepreneurial mindset. This kind of employee, the intrapreneur, is valuable to any company that seeks to remain innovative and keep pace with what is happening in the industry.
In the near future, all journalists will decide whether they are intrapreneurs or entrepreneurs. And yes, you can be both. At different times in a journalist’s career, both will be valued traits that generate opportunities in-house and in the marketplace
Given the nature of a changing landscape, journalists who leverage their entrepreneurial mindset to identify problems and offer solutions will make themselves invaluable to the media company. At the same time, every media company will be impacted by the market and need to make decisions that can result in layoffs. Journalists who prepare for such an inevitability will have generated opportunities outside of their employer’s shop.
Innovation: Sustainable & Disruptive
Inside media companies, the quest to keep up with the changing nature of the industry is a constant challenge. New technologies and innovations (new tweaks on existing products and services) are changing consumer behavior, which affects how media reach their audiences. Journalists are asked to do more to ensure their content is produced in multiple formats for multiple platforms and screens. Virtual Reality (VR) is a new technology, complete with hardware for immersive engagement of media content. Alternately, Augmented Reality (AR) is less invasive by incorporating something new into existing technology used by consumers. An example would be the game Pokemon Go.27 Using a smartphone, anyone who knows how to use the camera and the phone’s GPS can instantly play the game, which inserts an imaginary character into real-world scenes, as viewed through the camera. Thus, Pokemon Go’s augmented reality is an innovation of existing technology, rather than a new technology altogether.
Today’s media consumers are primarily digital and view media across a variety of screens, ranging from television to laptops and tablets, to smartphones (the preferred screen of younger audiences).28 The Internet is a visual medium, which means audiences prefer video and photos to long-form prose on their screens. Consider what it’s like to read a lot of text on the television. That’s a recipe for losing an audience. The same can be true for smaller screens. That said, there are ways of presenting articles to audiences in readable format via any screen. But each year, media must consider how the behavior of their audiences changes and adapts. This is known as sustainable innovation.
An example of sustainable innovation is CNN’s Great Big Story startup, which began inside of CNN. Bloomberg’s June 20, 2017 article,29 “CNN to Invest $40M in its Video Startup Great Big Story,” illuminates the point.
CNN’s investment in Great Big Story is one example of a fast-moving convergence in television, where traditional channels are pouring money into online startups to make shows for a younger, cord-cutting generation of millennials and Gen Z. Recent research from the Pew Research Center indicates that in the 18-29 age category, mobile usage is 100 percent in 2017, with 92 percent having access to a smartphone. NBCUniversal, for instance, has invested $400 million in BuzzFeed and $200 million in Vox Media. Recently, Time Warner said it would invest $100 million in making shows and buying ads on Snapchat.30
It may seem odd that CNN would invest in a media venture separate from itself. But consider the benefits. CNN’s investment is growing its younger audiences31 (25-35-year-olds) and opening a new market, like NBCUniversal’s investments in BuzzFeed and Vox Media. The risk taken is by the startup entity. The capacity for the startup to respond to market demands and experiment with new ideas far exceeds a large corporation’s capacity. Remember that corporations operate on proven business models while entrepreneurial ventures are in search of a business model that delivers the desired return on investment. Great Big Story already has found an approach in the market and is delivering a return on investment to CNN in a period of time. As the startup grows, it will become yet another valuable asset of CNN, its investor. If Great Big Story is sold via a liquidity event32 (i.e. merger and acquisition or initial public offering), CNN will benefit.
Throughout the life cycle of the startup, from development to market impact to sale, CNN will benefit. As the challenge to generate profits in the media industry grows difficult, and with more non-journalism players jumping into the media industry (technology companies, telecom and cable operators, app developers) and competing for market share, more pressure is placed upon media companies to pay attention and continue to be creative in how they gather, produce, and deliver content to their audiences, as well as how they engage their audiences in participatory journalism. The ability to sustain a competitive level in the media marketplace depends directly upon the priority placed on creativity that can lead to marketable products, services, and increased audience engagement.
Journalists should always be on the lookout for innovation in the market. Not just the journalism/media market, but the advertising/marketing industry as well. When these markets are hit by a disruption that impacts existing business models, changes will occur as companies adjust to the disruption. That adjustment can take many forms, but one is layoffs. The advertising industry is a volatile landscape that is evolving today. As technologies enable major advertisers to dispense with third-party ad agencies and go direct to the consumer of their products and services, media companies suffer a loss of revenue. And since most media operate on an advertising business model, the loss of that revenue means cuts in expenses. That domino hits the newsroom.
But disruptions in the media and marketing industries are also doors of opportunity waiting to be opened. Consider the fact that with more screens (and here comes the growth of virtual reality and augmented reality) there is a need for more content. With more cable channels, there is more need for broadcast material. With more corporate brands seeking to tell their story to consumers in a way that holds some integrity, they need the skills of professional journalists. Storytelling is the most valued commodity across all platforms of distribution. Stories inform. Stories influence. Stories have impact. Stories move people to feel and act on their feelings. The media and marketing industries, regardless of how they evolve, and how quickly they evolve, will always need storytellers.
Journalism is changing. But that’s not a bad thing. Remnants of the familiar remain. But the landscape is evolving. And while no one has a clear vision on where this industry is headed, the doors of creative opportunity are expanding. And that empowers both entrepreneurs and intrapreneurs to contribute their innovative ideas to help steer the industry into the future.
Mike Green is a New York Times Leadership Academy Fellow and award-winning journalist with 20 years’ experience. He is co-founder of ScaleUp Partners, a national consultancy specializing in economic inclusion and competitiveness strategies, plans, and policy. Reach him on Twitter at @amikegreen2.
This work is licensed under a Creative Commons Attribution 4.0 International License.
©2017 Michelle Ferrier, Elizabeth Mays, Jake Batsell, CJ Cornell, Geoffrey Graybeal, Mike Green, Mark Poepsel, Jessica Pucci, Ingrid Sturgis, Betty Tsakarestou, Jan Schaffer, Lori Benjamin, Dana Coester, Chris Dell, Dalton Dellsperger, John Dille, Amy Eisman, Francine Hardaway, Coury Turczyn, Georgann Yara. All authors retain the copyright on their work.
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