Never stop learning
Lesson 2, Corollary 1: Successful people are always on the look out for new experiences that they can later build on.
NEW YORK (Money Magazine) -- For a location where so much money is made, Silicon Valley struck me as remarkably friendly. With so many entrepreneurs and venture capitalists running around hoping to hook up and make a fortune together, I guess, everyone appreciates that social capital is a valuable asset.
I had called the mayor of Atherton, Charles Marsala, before arriving, a practice I employed in several smaller towns to avoid being arrested. He advised me that his town enforced strict laws against going door to door, but he offered to escort me to meet some prominent Athertonians himself.
When I arrived in town, we jumped in his red Ferrari Mondial (because that's what the mayor of Atherton drives), which, I had to admit, beat knocking on doors.
First I met Heidi Roizen, 48, a managing director at Mobius Venture Capital, a Silicon Valley firm with investments in the tech industry of around $2 billion. She's in the business of assessing risk, and I asked her if there are any lessons for the rest of us in the way she examines potential investments.
"Often when you mention risk, what people think of is the downside. Danger. That's not the entrepreneurial mind-set," she said. "The entrepreneurial mind-set is that risk is the heightened probability that there is a big range of possible outcomes."
Losing, she says, is no fun, but it's also essential to winning. When an investment doesn't work out as planned, Roizen analyzes her decision-making process to figure out what went wrong. She compares it to dissecting her performance after she delivers one of her frequent talks to Stanford M.B.A. students (building her network, as you've gathered by now).
"I usually spend a half hour telling my husband what went right or wrong," she said. "If I sit and think and talk out loud about what worked or didn't work, that becomes part of my psyche for how I figure out how to do the next lecture. I do the same thing in business."
Dweck, the psychologist who studies growth mind-sets, created an experiment to demonstrate how persistence and the pursuit of knowledge leads to success. She posed a series of trivia questions to a group of people with fixed mind-sets and another with growth mind-sets.
After each answer, one and a half seconds passed before the participants were told whether they were right or wrong, and, if they were wrong, another one and a half seconds lapsed before they were given the correct response. Their brains were monitored with electrodes the entire time.
Dweck found that the people with fixed mind-sets cared a lot about whether they were right or wrong but not at all about what the right answer was. The growth-mind-set participants stayed interested until the correct answer was given, showing an interest in learning new information rather than in simply validating their intelligence.
When the test was repeated right away, only the growth-mind-set group performed better.
Rich Miletic: from mowing lawns to CEO
Rich Miletic certainly would have. Marsala and I pulled up in the Ferrari as Miletic was packing for a ski trip with his wife Lisa and their children, but he took a break to talk.
As a boy growing up in Chicago, Miletic, now 45, worked maintenance jobs with his father, who had immigrated to the United States from Yugoslavia in the late 1940s. Mowing lawns and cleaning carpets at apartment buildings around the city, Miletic liked not having a real boss and making small "executive" decisions during his workday.
Years later, after earning an M.B.A. by going to night school after work, Miletic set out on a safe, corporate path of sales and marketing work for Honeywell, Motorola and Safco, a company that tests and improves wireless networks. He was good at what he did, but he never forgot those feelings of autonomy and empowerment that he had experienced in his first job.
After a couple of years, Safco asked Miletic to set up a sales office in Hong Kong.
He leaped. "I just took my wife and my laptop and went," he said. "I had always had the idea of starting my own company. So this was, for me, a way to do it."
The foreign setting, however, made running a start-up office far more challenging than if he had been in Chicago or Silicon Valley. "There was no Best Buy, where you could just go out and get all the computer equipment you needed. There were all these little mom-and-pop shops that you had to find. We didn't even have a business license, so we couldn't get a bank account at first, " he said.
But it took only two years for Miletic's fledgling office to tally between $4 million and $5 million in annual sales. Still, it wasn't his.
Miletic is a good networker in a small industry, and he heard about a company very similar to Safco that was for sale in Silicon Valley. He worked it out so that he wouldn't have to front much money, and today he's the owner and CEO of the firm, ZK Celltest.
He bought the company in 1996 and planned to sell it after five years but decided to keep building its value instead. His gradual ascension to entrepreneur worked: The Hong Kong adventure gave him valuable practice at being his own boss, but he was backed by the safety of a large company. He could learn by trial and error without crashing too hard. When he finally took over his own shop, he knew what he was doing.
"You have to take risks," Miletic said. "If I never did, I'd still be in Chicago working for Motorola."
Instead he's in Atherton - which, according to a list generated for Money Magazine by demographics research firm ESRI, is the wealthiest zip code in America.
Lesson 1: Make your own luck...Beverly Hills, Calif. 90210
Lesson 1, Corollary 1: Make others lucky too...Paradise Valley, Ariz. 85253
Lesson 2: Have a growth mind-set...Westport, Conn. 06880
Lesson 2, Corollary 1: Never stop learning...Atherton, Calif. 94027
Lesson 2, Corollary 2: Calculate your risk...Lake Forest, Ill. 60045