Last week, I talked about the external factors that separate how a good business feels from how a bad business feels: market demand, market quality, and the customer. But just because a business has product-market fit doesn’t mean it’s something that we look forward to working on. This week, I’ll focus on the factors internal to the entrepreneur that contribute to making a business feel good to work on.

Internal Factors

I think there are three major internal factors that entrepreneurs ought to look for: a business that builds on our own background and interests, a business that has depth and room for growth, and a business that allows us to live our core values, whatever those may be.

Work That Feels Familiar

Warren Buffett has been reading company financial statements since he was 10 years old. Tiger Woods started playing golf at age 4, and Taylor Swift similarly started with music at age 4 or 5. While I don’t think the rest of us have to start at age 4 in order to be successful, I do think we have to like what we do and look forward to at least some aspects of our work. The best clue is what we’ve been doing for a long time.

Sarabeth’s tech tips newsletter for retired people and my legal document management startup don’t meet this test. It’s possible there is a market need for these solutions (in hindsight I don’t think so), but the fact of the matter is that Sarabeth has no real interest in tech tips and I do not get excited about managing legal documents.  

By contrast, Sarabeth had an orientation towards visual art and design from a young age. A couple weeks ago, I talked about the stagflation of the 1970s in my undergrad capital markets class. I recalled then that I first started reading about finance and economics probably when I was 15, with a book called “The Prize” by Daniel Yergin.

When Sarabeth says that her interior design business was an “instant success,” my response is that her success is not instant. She’s been working at the craft of interior design—unintentionally—for probably 15 years or longer. It just took her a while to package all of her knowledge into a product.

Endless Room for Growth

A business that feels good to work on also has depth—lots of space to continue learning, sharpen our craft (build moats), and layers upon layers of products and services that we could provide that feel exciting to provide (product extensibility).

In my view, depth provides two benefits to the entrepreneur. The first is that it staves off boredom, and the second is that it gives us a means to distinguish ourselves in a highly competitive world.

I’ve said many times that in order to be good at something, we have to work on it for a long time. In order to work on it for a long time, it has to not be boring. For most of us, “not boring” means some aspect of change and variety over time.

My absolute favorite thing about finance is that no effort I spend learning about the space feels wasted. Although I’m a specialist in bonds, learning about stocks or currencies or commodities is still interesting to me because in the grand tapestry of finance, the threads of commodities are interwoven with the threads of bond markets in some way. To me, understanding the big picture of what the tapestry looks like feels very exciting. Human beings have spent centuries—millennia—trying to figure out how markets and the economy work and no matter how long I live, I will never run out of things to learn on this subject.

And never running out of things to learn, or ways to improve, produces enduring competitive advantage for people who are masters of their craft. I might be a decent analyst or trader already but I can always get better and there are endless ways to continue to improve, and as soon as I master one of those new tricks, I’m better than the person who was doing finance just to make money and doesn’t actually like the subject, because that person cannot summon the motivation to continue to get better. (I’m experimenting with 19^th century-style run-on sentences. What do you think?)

Last point on depth—finance and design are such rich fields that there is no limit to the types of products or services that Sarabeth and I can offer. I can be an investor, a teacher, or a writer, or all three, producing all kinds of things for all kinds of people. Sarabeth might be starting with interior design but what other business opportunities might build off of being a designer? A magazine? A furniture manufacturing business? Who knows.

Alignment with What Matters Most

When Sarabeth was describing how it felt to work on her design business, she used phrases like “I’m excited to work on it,” “the work is energizing,” “I feel unblocked and aligned.”

To me, this all comes down to our work being connected to our core values. In order to work we need emotional rewards in addition to monetary rewards. Working in alignment with our personal values produces a “thrill” or a sense of satisfaction that we just don’t get doing things that we don’t care about.

In my case, learning and curiosity has always been one of my core values. Every time I read, write or speak about finance I get to tap into that core value. Sarabeth identified “beauty” as one of her core values. Pretty obvious how that maps to interior design!

Last point on this, I think most values that people might hold (like “helping others,” for example) can be mapped to most fields. As long as you can understand the connection between what you find important and the work you do, that’s good enough.

Putting the Pieces Together

A business that feels good to work on has some combination of these internal and external metrics. Externally, the business should be something that has 1) clear demand, 2) customer spending power, and 3) customers that you want to work with.

Internally, we are looking for 1) building on our background and interests, 2) that has depth and room for growth, and 3) is aligned with our core values. If the business doesn’t feel good to work on, it’s very likely that one of these things is missing.

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Stay tuned next week for a piece on how to navigate moving forward when you feel like you have no options and no cards left to play.

Exercise

Journal on the following or discuss with a friend.

1)      Reflection

What kinds of things have I liked to do for a long time? What things did I do when I was young that were unusual, relative to my friends? What were my quirky interests?

2)      Reflection Part 2

What are my core values? Can I name three to five? (They don’t need to be perfect, you can always refine them later.)

How do my values map to the field I am in right now, or the field I often think about going into?

3)      Action

If I have had a longstanding interest that I’m not working on, what is the smallest action I can take to deepen my knowledge or understanding of that field? Or if I am already in the field I want to be in, what actions have I been meaning to do (“I’ll do it next week”) that I’ve been putting off?

As I take that action, how do I feel? Do I feel “energized, unblocked, aligned,” or do I feel something else?