"Camels instead of unicorns"

Let's start with a simple question: How do people learn entrepreneurship?

Dietmar Grichnik: Nobody is born an entrepreneur, any more than they are born a lawyer or a priest. You become an entrepreneur through socialisation. The ingredients in this socialisation process are creativity, a desire to experiment and an appetite for risk - so the exact same characteristics we see in children. In other words, everyone has the ability to be an entrepreneur, but many people have that ability trained out of them.

And you help them get that ability back. How?

For me, entrepreneurship is a combination of different behavioural patterns that support creative and innovative problem-solving, and can be applied in different contexts, not just in business. People should ask themselves three important questions: Who am I? What am I good at? Who do I know? The answers will help them pinpoint their strengths and the potential of those strengths. Each person is different, has different values and preferences, educational backgrounds and areas of expertise. Everyone has different networks that give them access resources such as competencies, contacts and capital. Recognising this and making use of it is something that can be learned.

To what end?

I start by identifying a problem I want to solve. Then I define an "affordable loss" - in other words, what I'm willing to lose in terms of time or money. Until part way into the 1990s, students were taught that the goal is to realise their business plan. 

That's no longer the case. Today, we teach them to take a start-up approach; to design a minimum viable product. And to then, during a resource-focused experimentation phase, test the product, learn and validate it, and pivot.

Can you give us some examples of things you experiment with?

The goal of an entrepreneurial experiment isn't necessarily to set up a company. Sometimes it's to conduct academic research and share practical knowledge, information and technology. An example that comes to mind is a recent hormone study I co-authored that was published in the Journal of Management. It explored how male investors react to female entrepreneurs' appearance in order to better understand why less funding is granted to companies founded by women. For the study, more than 100 test subjects watched a pitch presentation by actresses of varying attractiveness. Based on saliva samples and their cortisol and testosterone levels, we were able to prove that even professional investors are impacted by physical attractiveness and are therefore biased. With this research, we want to educate people about gender bias.

Doesn't this kind of experiment run counter to HSG's reputation as a training ground for future executives, for whom stability and reliability are among the greatest virtues?

Traditional career paths and professions such as banker, auditor or consultant still exist. But the traditional stereotype of what makes a good manager isn't something I focus on. Times have changed. HSG, and our faculty in particular, is entrepreneurial and is closely tied in to the economy. We're entrepreneurs too. For example, we are collaborating with the venture capital sector on projects like our Start-up Navigator and the Scale-up Navigator. And for around five years now, we have been placing a strong focus on the interface between entrepreneurship and sustainability. That's something our customers (our students) are calling for.

In today's world, do entrepreneurs consider sustainability more important than turning a quick profit?

Let me answer that with the help of a metaphor about unicorns. Unicorns tend to only be successful in Silicon Valley. The Harvard Business Review recently published an article entitled "It's Time to Think Like Camels - Not Unicorns". Camels have a number of advantages over unicorns: first and foremost, they actually exist. They are incredibly resistant and resilient, and can even sprint if necessary. These are characteristics that both entrepreneurs and investors are focusing on today; building business models that can handle a growth sprint, but that are financially more enduring and sustainable. And we are adjusting our teaching accordingly - slogans like "Fake it till you make it", are out. "Try it till you make it", is what it's all about.

Which trends can camels benefit from most?

I see three major trends that hold strong potential for both students and for society. The first relates to health, especially in a digital context, and how we can use physical and digital biomarkers to positively influence our health-related behaviour. This includes exercise, nutrition and general health-related behaviours. Longevity and healthy ageing are matters that interest us all as consumers. The second trend is artificial general intelligence (AGI)  and its convergence with Web3 technologies. While there is still a lack of Web3 tokenisation use cases in many sectors, the potential for disruption in this area is enormous. The third trend is something I mentioned earlier, namely greater sustainability through technology. All three trends can be leveraged using digital technology, thus making them rapidly scalable for entrepreneurs.

Can you give us some examples of sustainable entrepreneurship?

Sure. At HSG there is Pascal Bieri and his company Planted, which focuses on sustainability in the food and health sector. Planted specialises in alternative proteins. Bieri received the Founder of the Year award at HSG's last Start-up Summit, which was attended by 6000 people. The company has raised over 100 million CHF from investors, and its products can be found on the shelves of major Swiss grocery stores. Interdisciplinary high-tech start-ups like this one are exciting and hold a lot of promise. Raffael Wohlgensinger's company, Formo, is another example that comes to mind. Formo is developing a precision cheese fermentation process that uses lab-made, animal-free milk proteins - that will ultimately benefit both animals and the climate. Wohlgensinger is a strong believer in veganism and has been working on this project since he founded the Vegan Club at HSG.

Which takes us back to the importance of asking yourself "Who am I, what are my values?"

Exactly, back to the questions entrepreneurs should ask themselves. At times, Formo was Europe's best-funded foodtech company. It has received a total of 58 million USD  in funding - even though Wohlgensinger is still developing the technology. But the potential for scale is astronomical: if the technology works, it could be applied to every type of cheese in the world.

Other than providing seed and start-up capital, how can financial institutions like LGT support this new kind of entrepreneurship?

For a forward-looking and dynamic bank, corporate venturing with start-ups can bring a breath of fresh air to the business and the client interface. Both in the traditional way, by making investments through its M&A business, directly from its balance sheet or via funds. But what could be even more interesting would be to boost innovation around technology and talent by engaging with disruptive innovators at an early stage. Collaborating with entrepreneurs through an innovation lab, for example, has the potential to trigger change in a company's corporate culture.

How would a company benefit from that?

When the world of up-and-coming entrepreneurs and the world of established banking converge, an interesting paradox emerges. The start-ups want to establish themselves as quickly as possible, and the established companies want to be like start-ups again. Getting access to top talent from among the ranks of young entrepreneurs and students through collaboration can be a great opportunity for a bank. Banks are no longer the most sought-after employers in Switzerland. In the war for talent, they have to be able to offer attractive opportunities, because Gen Z wants their job to have purpose.

Which brings us back to the "why". Entrepreneurship doesn't end when a person finishes their education. It continues to impact how they live their life and the decisions they make, does it not? 

Absolutely, it's a continuum - which is something I teach the people who attend my courses for executives. These entrepreneurship courses are attended by 35 to 50-year-old executives, chief physicians and lawyers, among others. They sign up because they want to effect change, and they're hungry for something new. On the other hand, it seems you can only stay in a job if it aligns with your values. If it doesn't, you have to ask yourself "Why am I doing this"? This is not a silly esoteric question. Asking it is a very practical way of reconciling the meaning and purpose of an activity with changing circumstances. And as an entrepreneur, I have the ability to do that, which is both interesting and exciting.

And can potentially be lucrative?

There's no statistical proof of that - it's more of a business school stereotype. The main reason for studying entrepreneurship should not be to get rich. The average employee in high-wage countries earns more than an entrepreneur and has greater job security. Becoming an entrepreneur is  about the "why". Studies show that on average, entrepreneurs are happier than employees  - even though entrepreneurs work much more and earn much less money.

A bit like camels?

Perhaps. I think Bob Dylan got it right when he said: "A man is a success if he gets up in the morning and goes to bed at night, and in between does what he wants to do."

About Dietmar Grichnik:

Dietmar Grichnik (born in 1968) is Full Professor of Entrepreneurship and Technology Management at the University of St. Gallen (HSG), He is also Head of the Institute of Entrepreneurship and Technology, which has been supporting and promoting spin-offs and start-ups for over a decade. Grichnik, who started his career in banking, is also Vice President Innovation & Quality. His research focuses on entrepreneurship, innovation, decision science and longevity science.