Tina Seelig The Art of Teaching Entrepreneurship and Innovation No.1

I am Tina Seelig and I play two roles here today.

First, I am the host normally, but today I'm also the speaker. So I'm going to give you a little bit of my background so you know actually who am I besides of the person who usually introduces our other guests. I am the Executive Director of the Stanford Technology Ventures Program and along with my wonderful colleagues Tom Byers and Kathy Eisenhardt who are the faculty directors, we run the Stanford Technology Ventures Program. And we spend all of our efforts thinking about research and teaching and outreach efforts all related to high-tech entrepreneurship. My background is a little bit unusual. I actually did my PhD over at the med school. I do have my PhD in Neuroscience, and after that I've done a bunch of different things. I was a management consultant. I was a multimedia producer. I worked at Compaq. I started a company. And I also have written a whole bunch of books. And this talk is about the most recent book I wrote called "What I Wish I Knew When I was 20." Now, there's an interesting story behind this talk because I actually gave a talk by the same name three years ago right here. At that point this talk was extremely raw, it was brand new, it was just the beginning of some ideas. But what happened is the talk ended up really getting some traction. And a years ago, almost exactly a year ago, I was asked by HarperCollins to turn this talk into a book. And so over the last year I spend a lot of time digging in to these concepts and came up with a bunch of really new and interesting stories, and in fact changed my point of view on some of these ideas. So I'm going to tell you a little bit about what's inside this book and invite you at the end to ask whatever questions you might have.

OK, so as part of my role at STVP, I have the incredible honor of teaching a course on creativity and innovation. In fact, I see some of my students in the room. And the entire overarching theme of this class is that all problems are opportunities; the bigger the problem, the bigger the opportunity. Anyone in my class would probably be able to recite that in their sleep, right? Any problem is an opportunity. The bigger the problem, the bigger the opportunity. And what I do is I give students problems. They start out as really small problems and over the course of the quarter they get bigger and bigger and bigger until finally they just get extremely comfortable taking on challenges and looking at them through the lens of possibilities. Now, don't just listen to me, I mean why should you listen to me telling you that problems are opportunities? This is something that is embraced by the entire venture capital community and the whole entrepreneurial community. In fact, I'm going to play you a video clip that I play all the time. It's one of my favorites. It's by Vinod Khosla. Do you guys know who Vinod Khosla is? Who is he? Founder of Sun Microsystems, successful venture capitalist, and this is a 27 second long clip where he talks about problems as opportunities. Vinod Khosla: One thing I would say is..To me, every big problem is a big opportunity. If you think about it, no problem, no solution, no company. Very simple. Every big problem is a big opportunity. If you don't have a big problem, you don't have a big opportunity. Nobody will pay you to solve a non-problem. Tina Seelig: In fact, I see that was a talk where Tom Byers, my colleague, was introducing him, interviewing him. And this is a clip that we play in all of our classes because this is the essence, the core of entrepreneurship. So how do you teach this? How do you teach people to turn problems to opportunities and look at the world as opportunity rich? Is it like this? Is this what you do? You line people up in rows and columns right? In fact it kind of looks likes this room right here. Everyone lined up in rows and columns, the chairs bolted to the floor. God forbid you actually talked to anyone else or move around. It looks like everyone is taking a multiple choice test where they are filling out one right answer to every question, filling it out with the number two pencil. Is that how you teach creativity? I don't think so. This is the way you teach creativity. You get people out of their comfort zone. You get them jumping off of perfectly good cliffs. You get them to feel it in their gut. It's not necessarily a completely intellectual experience. You need to be able to take risks to do things you haven't done before to take on problems that no one knows the answer to. So what I'm going to do is tell you about some of the things that we do in our classes to help people have this experience.

So a few years ago, I was at the d.School, the Design Institute at Stanford was just starting off. There was the first year there was a boot camp class. There was a whole cast of thousands of people teaching the class, and I was asked to teach one week that focused on entrepreneurship. "Tina, will you teach one week that gets folks understanding the general principles and the ideas of entrepreneurial thinking." So I thought, what can I do? So what I did is I gave the students every team an envelope, and in that envelope was seed funding. How many of you know this story? OK, we're going to get cut to the chase in the second and go on to the next stories, but this one is the first assignment I gave. They had an envelope and in that envelope was seed funding. They had four or five days to plan as long as they wanted, but as soon as they opened that envelope they had two hours to make as much money as possible. Now, for those people who don't know this, the folks who don't know the story, how much money do you think I gave them? Any guesses? Audience: 500 Tina Seelig: $500, anyone else? Yeah. Audience: $5 Tina Seelig: $5. I bet you know this story, OK. I know you know the story. So OK, let's cut to the chase here. I gave them $5 and two hours to make as much money as possible. So what would you do if you were given this challenge? What would you do? Think about it. Does anyone have any ideas, any thoughts? Audience: Organize a party. Tina Seelig: Organize a party. Invite everyone and are you going to basically charge people? Audience: Absolutely. Tina Seelig: Absolutely. You charge people to come to your party. Love that idea, great! I'd love to come. How much are you going to charge people? Audience: $10. Tina Seelig: $10, so how much is the party is going to cost? Audience: About $50. Tina Seelig: About $50 so you only need five people to break even. OK, good. Anyone else, another idea? What you might do with $5 in two hours? First of all, you guys get gold stars because usually when I ask that question the first thing anyone ever says is, "go to Las Vegas" or "buy a lottery ticket." Really, they feel like, well I should take a really high risk for earning a big reward. Of course, we all know that the high likelihood is you're going to walk away with nothing. Well, let me tell you the clue. The teams that made the most money didn't use the $5 at all. They realized that the $5 was actually a limitation. They realized that that framed the problem way too tightly, and if that they looked at the skills they had and the opportunities around them that was worth a lot more. So with that in mind, what do you think you would do? Any thoughts? OK, since you're being shy I'm going to tell you. I'm going to give you a couple of examples. One team set up a stand in the middle of the student union here at Stanford in front of Tressidor. They put up a little sign that said, "We will measure your bicycle tire pressure for free, but if you need air in the tires, we will charge you a dollar." Pretty cool? Well, first they thought they were taking advantage of their fellow classmates because people could go around the corner and easily get their bike tires pumped up for free. But you know what, they realized halfway through the two hours that people were incredibly appreciative. And so what they did is they stopped asking for a dollar, and half way through they asked for donations instead, and you know what happened? People paid them much more. And they walked away at the end of two hours with a couple hundred of dollars. Pretty cool? Now there were some interesting things that fell out of this experiment. First of all they realized that iterating along the way experimenting was incredibly valuable. They could have stayed in their dorm room, written a business plan, and they never would have learned the fact all of these things they learned along the way that here by asking for donations they actually made more. So by rapidly prototyping, experimenting, and trying things out along the way they actually learned a tremendous number of things. So let me tell you what another team did.

Another team realized that on Saturday night there are all of these restaurants in Palo Alto that have really, really long lines. And so what they did is they made reservations at all of these restaurants, right? And as the time came up, they sold their reservation. It was a brilliant thing and again they learned some amazing things along the way. First of all, they learned that the women students were much better at selling the reservations, people trusted them more. And second of all, they realized this work best in the restaurants that have the buzzers that tell you when your restaurant reservation time is up because it was almost like a reverse hand grenade. It was something like "Here take this it's going to go off," and it was something tangible they can give. They was another added benefit there because once they give someone this buzzer they got that buzzer in return, and they now could trade that one and sell that one later in the evening, pretty cool. So again the students realized there was no excuse for ever having no money in their pocket. All they had to do is look around and see the opportunities in their midst. But I have to tell you; the team that made the most money completely challenged all the assumptions. They realized that the most valuable thing they had was not the $5 and was not the two hours. The most valuable thing they had was their three minute presentation time in class, which they sold to a company that wanted to recruit those students. Pretty amazing? It was brilliant and again the lesson here is that so often we frame problems way too tightly and if we keep unpacking and unpacking them we realized that we have resources that are much larger and more valuable than we even imagined. But we also realized that our own skills that we have and the opportunities around us are bigger than we ever thought at the beginning. So this was a great experiment and I was delighted with the outcome. I always like to give experiments and class assignments where I don't know what the students are going to do because they always do much more than I ever imagined.