Sunday, September 9, 2018

Entrepreneurship, Talent and Networking

By Robert Wenzel

I am pretty shocked at the comments left at the post, This is What is Drilled Into You at Harvard.

I put the post up to show the thinking at an elitist school in an age of crony capitalism.

To be sure, who you know can be very important when you are attempting to work your way through
a government bureaucratic swamp, but you can also just hire a lawyer who knows how to work the swamp.

But, most of entrepreneurship is about spotting and acting on opportunities. It has nothing to do with connections.

One commenter stated:
Not what you know, but who you know. That has made the business world go around and around for centuries.
This is just not so. In doing deals personally, I have contacted people out of the blue who didn't know me from Karl Marx but we got deals done because the deal was structured properly and it made sense for the party I contacted to do the deal.

As for those who have a specific talent, Donxon correctly comments:
I prefer Steve Martin's advice "Be so good they can't ignore you."
If you are real good at what you do, you are going to be in demand, no networking needed. This doesn't mean that networking won't give you an edge if you are competing for a spot when your talent level only matches those of others but if you bring superior talent it won't matter.

LeBron James will never have to network to get a job in the NBA. At the same time, the last guy on the bench may be there because some general manager is doing his agent a favor.

Where connections really help is when dealing with government.

I was aware of a money manager who once retained a big time very well-connected Wall Street law firm. He didn't really use the firm for much and so I didn't understand why a check went out to the firm every month. Then the SEC came knocking at the door one day and the money manager could have been in very serious trouble (I'm talking very serious) but he called up the connected law firm he was paying and a polished Harvard educated lawyer showed up from the firm and explained to the SEC that the problem wasn't the big deal they thought it was but merely a technical violation that didn't amount to anything. The SEC nodded to the very well connected law firm representative and went away.

Networking can also be a part of a marketing strategy for certain firms or operators but don't think for a minute you aren't making it because you don't have connections.

For the most part just be real good at what you do and it won't matter.

Robert Wenzel is Editor & Publisher of


  1. What are the consequences of accepting that we live in an age of cronyism? Could one then dispute that cronyism in such an age is rampant? Furthermore, should it be surprising that selectively discriminating, elitist clubs such as Ivy League schools perpetuate cronyism? Isn't that a characteristic of the in-group vs. out-group dynamic?

    OT (1)..."crony capitalism" is a commonly-used and easily understood catchphrase, but it is an oxymoron. Capitalism is a beautiful thing, and has been responsible for bringing the greatest amount of happiness to the greatest number of people. Cronyism has nothing to do with capitalism, and vice versa.

    OT (2)...our current financial system is not capitalist in the classic understanding...laissez-faire wherever it once existed has devolved to a government-corporatist cartel of "debt-credit financialism". The most recent refinements of control and interference were introduced as a result of the 2008 financial crisis. In this system, the true cost of a money commodity is unknowable, and thus the market pricing mechanism of capitalism has been defeated.

    1. The consequence is incompetence among the cronies. Think about all those brilliant young Asian kids who didn't get into Harvard. If I were in an MBA program at 2nd tier school I would hang around the engineering building and make friends with some lonely looking immigrants. Technically competent but socially isolated people are a huge opportunity for someone who can build bridges.

  2. "Networking can also be a part of a marketing strategy for certain firms or operators but don't think for a minute you aren't making it because you don't have connections."

    That's interesting because I had a boss that told me my lack of networking is what holds me back.

    "LeBron James will never have to network to get a job in the NBA."

    Let me know when engineers get treated the way professional athletes do. Remember the great stars of decades past didn't make what the current generation does despite their talent. Something certainly happened to drive up salaries and it wasn't just the TV revenue and free agency. There was a complete change in attitude regarding talent and what it is really worth. With that came the competitive bidding for it.

    For talent alone to get a job, especially one that pays appropriately, that talent must have the perception of the value it brings and be recognized. Networking allows one's value to be recognized. Most people don't have agents and recruiters can't just buy a ticket to a game to see how good they are. Networking is the way how good you are gets out so someone makes a higher bid.

  3. "Let me know when engineers get treated the way professional athletes do."

    Depending on what level you're talking about, actual engineers already get this kind of treatment. Most "engineers" in high-tech are just overpaid mindless drones who couldn't do engineering (as opposed to "hacking") even if their lives depended on that.

    1. There are lots of good at school engineers, but most corporations see everyone as fungible. Every good engineer I've ever known success, pulling off something that others can't do, patents, and so on is met with 'well, that's your job'. But a good at school engineer who networks rises up the career ladder. In modern terms it is called "The Dilbert Principle". I've never found an engineer who gets paid based on how much money he makes the company. If I had, I would be retired now.