The Entrepreneurship Coach
Ernesto
Sirolli has spent 30 years helping people find the resources they
need to start businesses and make them thrive. He and the people
he’s trained have been instrumental in launching more than 40,000
enterprises in 250 communities and 25 countries. Curiosity,
commitment, and the willingness to spend time in some of the most
remote locations on earth have given him unusual insight into what
successful entrepreneurs do well. Above all, he advises business
leaders to shut up and listen.
In
fact, “Want to Help Someone? Shut Up and Listen” was the title of
Sirolli’s TED Talk in 2012. Originally delivered at a regional TEDx
in rural New Zealand, his presentation was posted to the main TED
website and garnered nearly 2 million views, bringing worldwide
attention to his work. Speaking in heavily accented Italian, and in
his characteristic tone of wry simplicity, Sirolli recounted his
early experiences working for an Italian NGO that specialized in
economic development. After earning his laurea
di dottore in
political science from the University of Rome—the highest graduate
degree offered in Italy at the time—he set off in the early 1970s
full of idealism to work in impoverished communities in Algeria, the
Ivory Coast, Kenya, Somalia, and Zambia.
“Everything
we touched, we killed,” he says, evoking slightly nervous laughter
from the TED audience. “Every project we did, every single one of
them, failed.” He describes, for example, how his team decided to
teach Zambians how to grow food in the beautiful fertile valley where
they had always lived as pastoralists, shepherding animals but
planting nothing. The team imported seeds from Italy—tomatoes and
zucchini—but the locals didn’t seem interested. The team tried to
pay them money, but there was little in the valley available to buy.
Finally, the NGO started importing whiskey and beer in order to coax
the men into the fields. “We kept thinking, what is wrong with
these people?”
It
soon became apparent. The tomatoes appeared on the vines, huge
bursting fruits that put the most bountiful Italian crops to shame.
The team members were joyful, but the next morning they awoke to find
every single one of the plants gone. Hippos had swarmed up from the
river and begun gorging. The Italians ran to tell the Zambians what
had happened. “Of course,” said the people. “That’s why we
don’t plant in the valley.”
“Why
didn’t you tell us?”
asked the Italians.
“Because
you never asked,” came the response.
The
experience was painful. “I thought we Italians were good people,
and I wondered how we could fail so badly,” says Sirolli. “Was it
for these ‘results’ that we had hooked the community on whiskey
and beer? So I began looking around at other projects that had been
done in Africa—by the English, the Americans, the French—hoping
to get ideas. And I realized, at least we fed the hippos. Other
million-dollar projects just left rubbish behind. Everywhere I saw
the same problem: Our well-intentioned efforts failed because we
didn’t listen to the people we were trying to help.”
Challenging
Entrepreneurs to Succeed
The
story of Sirolli’s experiences in Africa is told in his
book, Ripples
from the Zambezi: Passion, Entrepreneurship, and the Rebirth of Local
Economies (New
Society Publishers, 1999). Now used as a text in many community and
economic development courses, Ripples offers
three essential messages about economic development. First, all
effective development ideas need to come from local people rather
than “experts,” no matter how well-meaning or informed these
experts might be. Second, most efforts to motivate people are
fruitless; rather, those trying to help local enterprise must wait
until entrepreneurs ask for help, then connect them with the
resources they need. And third, entrepreneurs should never be
encouraged to act in isolation on their dreams, because doing so will
increase their chances of failure and cause them to question their
own capacities.
This
last concept is important and informs Sirolli’s ideas about
development and the nature of enterprise. With a methodology
developed over years of challenging real-world conditions, Sirolli is
pushing back against what he sees as the all-too-prevalent myth of
the celebrity entrepreneur as go-it-alone individualist. “Instead
of writing biographies, the business media is often publishing
hagiography: hero stories about geniuses who do it all on their own,”
he says. “But when you look at the real story, whether it’s Steve
Jobs or Bill Gates or Sam Walton or [Thomas] Edison or the owner of a
chain of dry cleaners, you see none of them did it alone. They all
had [groups of colleagues] who could do the things they couldn’t
do. The way it’s presented is very dishonest. My work now is to
oppose this fake mythology and show that enterprise really succeeds
when the right people come together.”
It
led Sirolli to cofound the Sirolli Institute, a global social
enterprise in Sacramento, Calif., that is dedicated to revitalizing
communities by fostering entrepreneurship. In Sirolli’s view, this
is a calling of the highest order. If communities devastated by
industrial decline or isolated from global supply chains are to
flourish and create sufficient jobs, local entrepreneurs need to
succeed. Young people, he notes, are particularly inspired by a
vision of responsive, grassroots growth, of going where they can and
working with what they find to create products and services of
distinctive value. Supporting them and helping them find what they
need to thrive is the essential first step to healing communities.
Sirolli’s
method for supporting such endeavors involves training “enterprise
facilitators” (EFs) in each locale. These are individuals who work
for either the community or a development agency and whose sole
mission is to help entrepreneurs identify and find needed resources.
He has trained about 185 EFs, located around the world. “These
people don’t work for me, and they don’t work for the people they
help,” he says. They work for government agencies or companies
committed to local development, which pay them directly. “For most
of them, it’s a full-time job.”
Making
the Business Beautiful
On
a bright afternoon at a Starbucks just outside downtown
Sacramento—where Sirolli and his wife and business partner, Martha
Sirolli (executive director of the institute), live—he is waiting
to meet an entrepreneur. He rarely works directly with entrepreneurs
anymore, and he seems to welcome the chance to exercise his skills
directly, as a college president might look forward to teaching a
class.
“There
are two rules for enterprise facilitation,” he declares. “First,
your relationship with the client is sacred and entirely
confidential. Second, you treat the client as an adult. That means
the client gets to decide whether and when to act on what you
discuss. It’s not your role to monitor how that person is doing or
hold him or her to a timeline. For that reason, you never call the
client, you only call the client back.
To be passive is the foundation of this work, and that’s why it’s
difficult. It takes discipline to resist the impulse to do, to tell,
to solve, to intervene.”
He
adds that he trains facilitators to be conscious of every gesture.
They must signal that the facilitator is someone to confide in: a
resource rather than an authority figure. “You meet your client in
a coffee shop, not an office. You don’t take notes during the
meeting. You sit shoulder to shoulder and get the client to draw
something and then look at it together. [These signals] create a
feeling of collaboration.”
Sirolli’s
father was a doctor, first in a small Italian village and later in
Rome, and he finds a strong parallel between the two practices. “I
see enterprise facilitators as the family doctors of business. The EF
is basically a diagnostician. You help diagnose what an entrepreneur
needs and suggest ways to find the right resources. It’s not your
job to follow up. If my father saw a patient smoking in the piazza
the day after a consultation in which smoking had been discussed, he
would not even let it show that he noticed. It was up to the patient
to change his behavior.”
Then
the entrepreneur arrives. Ben Aller is a handsome, athletic young man
wearing an air of anxiety. He thanks Sirolli for meeting him and
explains that his company builds custom environments for zoos, which
enables him to fuse his passion for design with his love of animals.
For almost a decade, Aller ran the fabrication shop for a major zoo
supplier in Arizona, but he was frequently told he was too interested
in his work. “I kept hearing stuff like ‘You don’t really need
to know about the mating habits of shrews to do this project.’ My
enthusiasm didn’t seem to be a plus.” In 2004, he returned home
to Sacramento and set up an exhibit business of his own, including a
manufacturing center on a friend’s ranch.
“It’s
been a struggle,” he says. “The selling part takes time away from
designing and building. Plus it can take two years between initial
contact with a client and when you get a check.” The previous year,
Pixar Animation Studios contracted with Aller to build artificial
branches for a reptile house, a complex job that took four months,
during which time he had to turn down other work. This was followed
by six months without a job. “Clients love my product, but the
business feels like it’s built on sand.”
Sirolli
asks Aller what he is good at, and what he isn’t good at. “I have
great ideas and my work is the highest quality and original, but I’m
not a good marketer or money manager. I don’t actually likemoney,
but I need money to reach my goal, which is creating zoo exhibits
that connect animals and people.”
“Tell
me, who is helping you? Who is working with you? Come sit beside me
and draw me a picture of your supporters.”
Aller
pulls out a pen. “I have my mom, but she doesn’t have any money.
I have my friend Jay, a kind of father figure, whose ranch I work on.
He lets me use his equipment and gives me lots of support. Plus a
landscape designer and animal artist—both great—who I had to lay
off.”
“It
takes three people to make a business,” Sirolli says, “those who
know product, marketing, and financial management. This is the
trinity of business. Who are these people for you?”
“If
you put it that way, almost everyone is product. For financial
management, I have nobody. For marketing, only a part-time Web guy.”
Sirolli
notes that most product people cannot double as marketing people.
“Product people believe they can sell because once they’re in
front of a customer, they [will] blow [the customer] away with their
passion. But an occasional blown-away customer does not make a
business. There has to be someone who screens 100 prospects so you
can get before the right ones. If you don’t have that, it’s a
waste of time. You shouldn’t be doing sales unless a marketing
person sets it up.”
“But
I can’t afford to hire a marketing person,” says Ben Aller.
“You
don’t need to hire someone. Did Steve Jobs hire Steve Wozniak? Did
Bill Gates hire Paul Allen? No, they went into business together.
Businesses are founded on relationships, and you don’t have the
relationships you need to be a business. So finding your people is
your job.”
“My
problem is money.”
“No,
your problem is trying to do everything yourself. You have to say, ‘I
am the sultan of zoo fabrication, and my job is to form a team that
can take my products to the world and make sure they pay.’ Then you
look for a marketer who is so good she will work on commission
because she knows she can bring in clients. The right person is out
there. Maybe she’s in a horrible job or has been laid off. Maybe
she’s just starting her career. You give her a list of all the
contacts you’ve built up and offer her a good commission plus 30
percent of your business. Then you bring in a financial manager the
same way.”
“How
do I find them?”
“Ah,
this part you will like! Marketing people and financial managers are
like animals—they live in habitats. So go and hunt, turn over the
rocks as you would when looking for lizards. Identify which habitats
you need to explore. Call your friends in zoos and ask them to give
you the name of the best marketing person they have ever met. Go to
animal volunteer societies and ask about people who have experience
in marketing. For finance, go to the bank or ask your friend Jay—he
probably has some white-haired guy he plays golf with who could meet
you a few times a year. Go to these people with such passion for your
product that they are inspired to work with you.”
“I
like the idea of habitats, and I love the idea of going to zoos—why
didn’t I think of that?”
“Because
you weren’t seeing that your real job is to build friendships so
you can stop drowning in solitude.” Aller replies that the lack of
money still feels like a pressing issue. “If you had money now,”
says Sirolli, “it would only help you to fail faster. You’d spend
it creating new products you couldn’t sell. I want to give you an
image: Your company has to be as beautiful as your product. Right now
you have great products but a weak company. It won’t change until
you find your people.”
From
Australia to Esperance
After
leaving the Italian NGO in the 1970s, Sirolli came under the
influence of E.F. Schumacher’s 1973 classic Small
Is Beautiful: Economics as if People Mattered (Harper
& Row), an influential book that championed the use of
appropriate technologies and questioned the then-unchallenged belief
that bigger is better and progress is always measured in numerical
growth.
He
was also influenced by Abraham Maslow’s work on psychologically
healthy individuals. One of the first psychologists to insist that
psychology could benefit healthy people, Maslow noted that the wisest
individuals he met seemed to be following Nietzsche’s injunction to
“become what thou art.” Maslow described this drive as
“self-actualization” and put it at the summit of his influential
“hierarchy of needs.” The drive to realize one’s potential was
more significant than the need for food, shelter, and love. To
Sirolli, Maslow’s insight confirmed the importance of intrinsic
motivation: The best way to support social and economic growth was to
help people do what they wanted to do, instead of presenting them
with preconceived projects or promising more transactional rewards.
The
best way to support social and economic growth was to help people do
what they wanted to do.
Sirolli
moved to Perth, Australia, in 1979, eager to put into practice the
ideas he’d been incubating. Inspired in part by the concept of
self-actualization, he enrolled in a Ph.D. program at Murdoch
University; his goal was to study how the principles of humanistic
psychology could be adapted to economic development. For his
demonstration project, he persuaded the town of Fremantle, south of
Perth, to give him US$1,025 (AUS$900) for a job-creation project.
At
a local craft market, he observed a number of young people who were
“putting a lot of effort into making terrible ugly sandals that
nobody wanted to buy.” Scouring the region for someone who could
help them improve their skills, he discovered a Sicilian immigrant, a
shoemaker since the age of 14, who made surgical boots for the local
hospital to suit people with foot deformities or serious injuries.
Sirolli introduced the shoemaker to the five most dedicated sandal
makers, helped the group locate space in the basement of a local
furniture factory, and spent the minimal funds he had secured buying
tools. Thus was born the Fremantle Shoemakers’ Cooperative. The
venture lasted 10 years and turned the town into a center for the
manufacture of orthopedic footwear—as well as fashionable shoes
made from kangaroo hides that had formerly been exported to Italy for
luxury brands.
A
television documentary on the success of the venture caught the
attention of the minister for regional development in Perth. He was
looking to boost the prospects of Esperance, a coastal village
nearby. The region had been in sharp decline since the government
introduced quotas on tuna in response to overfishing. The minister
offered Sirolli a plane ticket and keys to a government apartment.
In
Esperance, Sirolli began inviting local people for coffee, always
asking the same question: “Do you know anyone who is thinking of
starting a business?” He was always told no. The problem in
Esperance, he kept hearing, was that people were too lazy and too
well looked after by the government to have any interest in working
for themselves—most of the fishermen who’d lost business had gone
on the dole. Eventually, a group of fishermen came to Sirolli to ask
if he could help them figure out how to get a better price for their
tuna. Since the catch quotas had been put into effect, the harvests
had become too small to support them at the commodity prices for
which the tuna was sold.
Sirolli
persuaded five fishermen to contribute $228 of their own money to
commission a study to see how they might sell their fish at a higher
profit. They learned that tuna sold to local Japanese restaurants for
sashimi fetched 10 times as much as the 68 cents per kilo they’d
been getting. Sirolli then helped the group secure a $1,140 loan from
a ministerial discretionary fund so they could learn the precise
methods required to prepare tuna for the sale. He connected them with
the head of a local technical college who put on sashimi handling
demonstrations, and they used some of the money to fly a Japanese
chef in from Perth to train them.
This
was the start of an explosion of local activity that eventually led
to Esperance’s becoming a prime supplier of superior-grade sashimi,
not just to Japanese restaurants in Australia but to suppliers in
Japan. Since the Japanese paid a full $17 per kilo for their product,
the fishermen now earned more money than they had before the
institution of the quotas.
Their
success inspired a group of farmers, who figured “if those idiot
fishermen can do it,” they should
be able to address two of their own difficulties—getting a better
price for their sheep and stopping soil erosion. Sirolli got each of
the farmers to contribute $114 to commission a study on a new
approach to selling mutton and found two young agronomists to look at
how the value chain for old ewes could be enriched. The team came up
with a cost-effective way of making use of the sheepskins. Sirolli
also brokered a meeting with a local environmentalist—formerly
viewed by the farmers as “the enemy”—who helped them identify
commercial uses for the native scrub that grew on their marginal land
and find an instructor to start a class in re-vegetation at a local
college. Within a short time, the farmers had both expanded their
business and stopped soil erosion.
Business-Centered
Therapy
Sirolli
has achieved this kind of success by adapting methods pioneered by
Carl Rogers, the founder of “person-centered therapy” and a major
influence on organizational development. Rogers’s clinical work
demonstrated that a therapist could help people heal by simply “being
there,” offering witness and support. “Rogers basically invented
facilitation,” says Sirolli. “He believed a counselor’s sole
job was to remove obstacles so a patient could resume normal growth.
He told his students, ‘You don’t
do the work, you let your patients do it. You’re there to honor
their innate wish to grow.’”
Using
Rogers’s technique with entrepreneurs represents a radical
departure from ordinary business development. “For one thing,”
Sirolli notes, “few programs emphasize one-on-one work with
entrepreneurs, preferring to focus on infrastructural support such as
microloans, literacy, and training. Also, most programs require
entrepreneurs to complete a business plan before applying
for funding, even though there’s little connection between the
ability to write a plan and [the ability to] run a business. Finally,
a lot of programs supply money. Our practice is to never do that, on
the theory that an entrepreneur with a good plan and the right team
will have little problem finding money.” The real challenge of the
method, he says, is “being comfortable enough to wait, to resist
the temptation to step in. That’s tough in our action-crazy
culture.”
Sirolli’s
success drew national interest. The Australian government provided
money to train “another Ernesto” to continue in Esperance so he
could move on and start more projects. “They sent me a wonderful
young guy, and the training took place in the back of a station
wagon. I told him, ‘There are just two things you should never do.
Don’t initiate anything yourself, and never try to motivate
people.’” The newly anointed EF objected that it would be a
disaster to rely on locals for ideas, but promised to do “nothing”
until given different instructions. Within two months, he had 46
projects under way.
Mining
and Communities
By
the late 1990s, Sirolli was in demand throughout Australia and New
Zealand—surfacing ideas, brokering relationships, training
facilitators, and finishing his book. Around this same time, he met
his second wife, Martha Sirolli, and they began working together.
Sirolli worked for a Minnesota development agency, then with a
federal enterprise zone in South Dakota, and ultimately with the
institute that he and Martha cofounded when they later moved to
Sacramento. In every venue, he followed his practice of drinking
“bottomless cups of coffee” with the locals and helping those who
were motivated find resources to start viable businessess.
Ripples
from the Zambezi found
an avid reader in Bruce Harvey, an exploratory geologist who
negotiated land access for the Melbourne-based mining giant Rio
Tinto. “Ripples spoke
to me, because in mining we need to be concerned with the long-term
viability of communities where we open mines, which for the most part
have little in the way of physical or social infrastructure,”
Harvey says. In other words, a giant mining company entering a local
area could learn something valuable from the example of a
social-entrepreneurship catalyst like Sirolli.
n
the past, we promised communities that if they let us come in and
create a modern economy, they’d get to participate and reap the
benefits,” says Harvey. But it didn’t work that way. “Mining
and petroleum are capital-intensive industries that don’t produce
many jobs. Plus, most of our workers have specialized skills and must
be brought in from elsewhere. So we need a different model for
helping people who live near our mines sustain some kind of
livelihood. If we can’t do that, they’ll end up throwing us
out—maybe not right away, but after a generation or two. The work
Ernesto described in Esperance and Fremantle—places I knew—offered
a different approach, one based on local talents, ideas, and
ambitions.”
Harvey
asked Sirolli to keynote the annual conference of the Minerals
Council of Australia, the industry’s chief trade group, in 2007.
The purpose was to present an alternative to the top-down,
engineering-based model of development that resource companies had
traditionally pursued—bringing in well-paid consultants to teach
resource-starved local people how to do jobs the consultants thought
they should do. “Ernesto showed us how we could help local people
identify businesses they wanted
to start. He told us to listen instead of commissioning studies.”
Sirolli,
for his part, saw a huge opportunity for helping mining companies
become real partners in development. In his speech at the conference,
he invited the executives to “imagine if people wanted your company
to work with them because they knew this would improve their
community! You’d be invited to bid on projects instead of having
communities organizing against you.” The speech created a stir.
Until that point, most of his work had been with governments,
development agencies, and nonprofit organizations; now industrial
companies also started to seek him out. He began a series of seminars
on enterprise development for mining executives, and accepted a
fellowship at the University of Queensland to teach corporate social
responsibility in resource-intensive industries. With sponsorship
from mining and energy companies, he set up training for enterprise
facilitators in communities where natural resources were being
developed, as diverse as Canadian tribal lands, remote villages in
Indonesia and Wales, and rural U.S. communities where shale oil was
being produced.
Bruce
Harvey, who had been promoted to global practice leader in community
and social performance for Rio Tinto, brought Sirolli in to work at
Oyu Tolgoi in southern Mongolia, site of one of the world’s largest
copper mines. “The NGOs in the area wanted to help the local
people,” recalls Harvey, “but they were proposing things like
chicken farms, which are totally alien to Gobi culture. Ernesto came
out and said, ‘Don’t propose anything, just get people talking.
Thenthey can
figure out how what they want to do might pay.’”
Sure
enough, listening revealed an opportunity: developing a market for
wool from the two-humped Bactrian camel, a fiber renowned for its
softness, warmth, durability, and strength. “It’s potentially a
very lucrative product,” says Harvey, “but it was being treated
as a commodity, like ordinary wool. The locals mostly just lopped off
the dirty camel hair any which way with scissors, tossed it into
bags, and sold it in bulk to Chinese traders. That left most of the
value on the table.” The enterprise facilitators helped the local
farmers discover how they could add value at every step. They sheared
the wool carefully with tools that kept the strands intact. Then they
cleaned, sorted, combed, and wove it, doing the finish work required
to create a beautiful luxury fabric sought out by designers all over
the world.
Small
Interventions
One
of Sirolli’s current goals is to work with business schools to
shift the nature of entrepreneurial education. “Most schools teach
entrepreneurs that they must have all the
skills—product, marketing, financial management. They reward
students for putting together a go-it-alone business plan instead of
collaborating or identifying who they need to start a business with.
In this way, [the schools] often set their students up for failure.
If, instead, schools could provide enterprise facilitators, they
could help students figure out what they really need to get started.”
Sirolli
had not realized until his 2012 TED talk that his methods could have
value for established organizations. “I now hear from so many
businesspeople. An entrepreneur from Florida just flew to Sacramento
to see me. He said, ‘I’ve been very successful, but I realized I
don’t really know what people in my companies are capable of
doing.’ I said, ‘Do you realize that among the people you employ
there are some with beautiful dreams that you could invest in? This
would be an organic way to grow your business.’”
Sirolli
believes that enterprise facilitators will always have an advantage
over planners and development boards because they avoid
over-investment and don’t choose which projects to support.
Instead, they help people identify impediments that stand in the way
of translating their dreams into businesses so they can move forward.
By making small interventions on hundreds of projects, EFs avoid the
pitfall of trying to pick winners. Because nobody can predict
tomorrow’s market, Sirolli notes, “Economies that rely on a few
starters and products will always be vulnerable. The nations with the
broadest catchment areas will be leaders.”
Or,
to quote Peter Drucker, “Innovative opportunities do not come with
the tempest but with the rustling of the breeze.” Helping small
businesses offers a way to fan that breeze.
By
Sally
Helgesen
