Are You a Cook or a Chef?

[MTF]

In his most recent blog post, Tim Urban at waitbutwhy.com described the difference between a cook and a chef (it takes about 90 minutes to read, but it's well worth reading).

Cooks start with a recipe and follow it to the T or make smaller or bigger modifications, while chefs start with a blank slate – raw ingredients they combine to create something unique.

While reading Tim’s enormous post I couldn’t stop noticing many similarities to being an entrepreneur, and most notably to Peter Drucker’s definitions of a proprietor vs a true entrepreneur.

Jay Abraham explains the difference in one of his emails much better than I ever could (I provide a quick summary after the quote if you don't want to read it):

A proprietor (as described by Peter Drucker) is a business owner who pretty much adds nothing meaningful to the business category they address.

A Mexican restaurant or a deli that does pretty much the same thing much the same way every other one does it‐‐‐adds little (if any) real value to the marketplace ‐ other than (maybe) convenience of location.

Certainly the owner is banking on the market expanding to embrace his or her offerings, but they don't make the experience any better. They don't redefine the concept. They don't innovate the model or the product/service offering. It's just another deli or Mexican restaurant.

On the other hand, a true entrepreneur is a business owner committed to continuously innovating ‐ innovating how they conduct business, and what they offer, innovating the experience people encounter, innovating the way the product/service gets delivered/presented, innovating the product/service itself.

Drucker didn't say it ‐ but I see a proprietor as someone who sets up a generic business that's non‐distinctive, one that takes oxygen out of the air and cash out of commerce, but frankly, contributes back very little exceptional value to the market beyond the "mere" self‐serving commodity aspect of their product/service offer.

Drucker ‐ squarely sized up the difference between a proprietor and an entrepreneur. The proprietor (he says) merely does what has been done by thousands before them. They don't try to create a new satisfaction, experience or consumer demand. All the proprietor does is hope they can tap into existing demand.

An entrepreneur creates something new, creates new experiences, new satisfaction, new definition of what they do. Entrepreneurs create something different ‐ more exciting, more satisfying, more desirable or valuable to the market.

They change, transform or transmute values. Entrepreneurs focus on changing reference models. They find ways to improve, redefine products/service experience, the process. Perhaps, MOST importantly, entrepreneurs make truly positive impacts on their market.

They are committed to being "game changers" ‐ true innovators who renew, shift, alter, redefine their marketplace position and product. They multiply the benefits, magnify the experience, maximize the advantage‐‐FOR the consumer. It's ALL about benefiting the consumer!

When you look at the year ahead, ask yourself a sobering question. It's this: Am I merely siphoning cash out of my market's momentum ‐ or am I truly adding innovative value? Am I a multiplier‐‐‐or a diminisher?

Am I making a huge positive impact‐‐or no worthwhile/significant effect, whatsoever? Can't answer? If that's the case, you probably AREN'T innovating and/or adding anything meaningful, purposeful to your marketplace or their experience. You probably AREN'T making any true, positive impact!

True entrepreneurs require no certainty, instead they "feed on" opportunity. Problems are their fuel of achievement. Challenges are their competitive advantages.

Probably the biggest differentiation between being a value creator or a "commerce siphon" ‐ is whether or not your business is based on purposeful/impactful innovation vs. pure profit motivation. Profit today, more than any time in the past is a by‐product of contribution and the amount of value that your business adds to the consumer.

Obstacles in an industry are motivators for the entrepreneur to figure how to surmount inventively/advantageously.

Why? Because businesses are not static. Yours either grows or it dies. But growth can be illusory. A business can increase sales and even improve profits (short‐term) while actually losing market meaning. The entrepreneur that does NOT innovate inevitably ages, declines, struggles, stagnates, suffocates or dies.

But don't think that entrepreneurship is natural, automatic and just naturally flows to some lucky people. It does not! It's hard, continuous work ‐ but what isn't?

If you're a proprietor ‐ you need to convert and become a "Born Again" entrepreneur. How? Try this:

* Become supremely receptive to seeing change in marketing, change in consumer buying habits, change in competitive offering as an opportunity rather than a threat.

* Continuously evaluate your business and its performance as an innovator/value creator in as many critical categories as possible, i.e. product development, value added, buyer experience, performance dynamic of product, service people.

* Become obsessed (almost) for discovery, development, perfecting new things ‐ new ways of marketing, new ways of delivering your products/service, new ways of improving the transactional experience. See your world differently than your competition.

* Learn to overcome resistance to innovate, by wanting/craving continuous breakthroughs in marketing, strategy, innovation, your business model, your competitive positioning.

Any business owner who tries to hold on to the "status quo" will lose ground, rapidly. Recognize the importance of innovation and the fact that it takes time and resource allocation/investment to bloom.

You can't merely wish for your business to become a true value creator to the marketplace. You need to plan and execute, nurture (and nourish) specific, progressive steps.

Nothing good or great comes without effort and hard work. But if you crave new ways to reach your market, new product/service offerings or impact, new markets to serve, new methods for doing business, new technologies to produce a better outcome, new ways to successfully compete ‐ your business CAN thrive!

A proprietor is a cook following "a recipe" for starting a profitable business.

A friend makes 5 figures with Amazon FBA importing cheap products from China? Time to hop in on the train. Read about a guy releasing crappy outsourced books and making $5k a month? Sounds good! @IceCreamKid is doing well with carpet cleaning? Count me in, let's steal his business model and make some cheese! Sexy "startups" raking it in? Time to give myself a snazzy "CEO" title and "disrupt" the industry.

It's mostly self-serving thinking that results in "me too" business that's impossible to discern from a multitude of other similar businesses. Proprietors give little thought to delivering more value and doing things in a different way.

All people following a gold rush can be described as proprietors. There's no innovation and improvement - they're just another person digging for self-serving reasons without providing any additional value to the market. Their clients are not people - they're numbers. They don't help people - they follow "customer acquisition" strategies.

In comparison, true entrepreneurs are chefs. They start with first principles reasoning - a blank canvas on which they paint an entirely new experience. They don't follow a "12 steps to build a business" guide. They don't post threads on forums asking for business ideas. They don't copy someone's business just because they saw it was successful.

They focus on the basics - how to provide value to the market and help their audience - and go from there. The question whether anybody else has done it in such a way isn't very relevant. They're going to create, not copy, and to achieve that, they won't follow anyone else's recipe.

Don't get me wrong, there's nothing inherently wrong about being a proprietor. I've started a fair share of proprietor-style businesses (and yes, I started many of them for the wrong entirely self-serving reasons). Not everything has to be unique or world-changing, and you can still make good money being one.

But if you're after exponential growth and a true long-term Fastlane business vehicle, becoming a chef will serve you much better. And that leads us to...

Are You a Consuming Producer?

Whether you're a proprietor or a true entrepreneur, you're still a producer, and that means you'll be much better off than people who mostly consume. However, I can see two layers of being a producer - a consuming producer and a producing producer (yes, I'm aware it sounds stupid but at least it's me who came up with these terms).

A consuming producer's focus is primarily on his needs. As long as he makes money, it's all good. He does generate some value for the market, but it usually balances out with how much he siphons out of it.

A producing producer can't feel satisfied while merely making good money - he gets off on innovation, improvement, the simple act of helping people, and value creation. He generates more value for everyone involved and doesn't keep score.

Financially-wise, a consuming producer can still make millions or billions, but it's the producing producer who's going to get many more rewards other than just money. He'll get:

• more meaning. And in today's world, more and more people care about the "why" and businesses that impact the world in a positive way. More meaning also means more motivation, and that directly translates to the success of the business.
  
• more connection. @Andy Black is a great example here. He could be a consuming producer and stick to writing a few posts about AdWords here and there targeted at attracting the best potential clients. Financially-wise, it would make more sense as he wouldn't spend time helping people who would be unlikely to become his clients. Instead, he writes about a wide variety of things, many of which aren't even related to his specific main expertise. He just helps however he can. Consequently, people relate to him on a much deeper level. And in the end, that produces even more rewards for him than if he was just another "me too" AdWords expert.
• more excitement. Merely following someone's recipe is dull. Using creativity and creating something that has never been done before is fun. Changing the industry and becoming THE only unique option is exciting. What can be more boring than just being another ossified business dinosaur?
  
• more happiness. I won't argue - making money feels good. However, some people (not all) are wired in such a way that they drive much more happiness from their businesses if they know they impact the world in a big way. Monetary reward is great, but when it's combined with the knowledge it makes a real difference in your market, that's when you get contentment.

5 Questions to Become a True Chef

Jay Abraham suggests to ask yourself the following questions to shift from being a proprietor to a true entrepreneur:

Am I merely siphoning cash out of my market's momentum ‐ or am I truly adding innovative value?

Am I a multiplier or a diminisher?
​

Tim Ferriss has recently touched upon a similar topic in his article "How to Say 'No' When It Matters Most." These two parts are the most relevant for what I'm discussing here:

He thought very carefully in silence and then said: “I’ve been at events where people come up to you crying because they’ve lost 100-plus pounds on the Slow-Carb Diet. You will never have that impact as a VC. If you don’t invest in a company, they’ll just find another VC. You’re totally replaceable.”

He paused again and ended with, “Please don’t stop writing.”

Being a VC - yet another cook. Note the use of the word "replaceable." That's precisely what a cook is.
Being a writer - true chef.

BUT… if I stop writing, perhaps I’m squandering the biggest opportunity I have—created through much luck—to have a lasting impact on the greatest number of people. This feeling of urgency has been multiplied 100-fold in the last two months, as several close friends have died in accidents no one saw coming. Life is F*cking short. Put another way: a long life is far from guaranteed. Nearly everyone dies before they’re ready.

Tim's words remind me of Daniel Ally's article "The 1 Question That Made Me a Millionaire" and two questions he asks there:

How can I deliver more value to more people in less time?

How do I increase the quality and quantity of what I do in the fastest way possible?​

The essence of these questions call for innovation and improvement, not stale thinking. Will copying get you there? Tim Ferriss as a VC is a cook, Tim Ferriss as a writer is a chef. It's the latter that helps him deliver more value to people in less time.

Last but not least, there's Dan Sullivan's powerful question:

What is the single focus and activity that would keep you absolutely fascinated and motivated for the rest of your life?​

This question is NOT about building a business following your passion. It's about finding your specialty as a chef so you can provide the biggest value to the world while also enjoying the process of doing it.

The cooks are merely managers in this world. They can't create anything new without somebody else first creating it for them. The world moves forward because of the chefs.

Go with your gut more often. Don't be afraid to experiment with raw ingredients.

Some of your dishes will turn out disgusting. That's fine - going without a recipe is more difficult and takes more tries to succeed.

Some dishes will be okay. They'll give you feedback, and you'll keep refining your skills.

Some will make your patrons let out orgasmic moans. And that will more than make up for all your previous failed or average experiments and create rewards the cooks can only dream about.

Who's your patron and how are you going to make her experience something she's never experienced before?

 

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[DaRK9]

How can I deliver more value to more people in less time?

How do I increase the quality and quantity of what I do in the fastest way possible?​

I have this over my desk. Awesome post. Love that article too.

 

[Raoul Duke]

This should be notable! bump

@Vigilante

 

[T-K]

I have always liked reading step-by-step kind of things and always felt sick to my stomach afterwards. There is a voice inside me that says "I hate blueprints" when I read those. But I keep reading them still, I am an addict.

You, my friend, made me believe in the power of words right here. I know some part of it is quoted but the way you did that, I can't describe the feeling very well. You changed my life forever with this post.

P.S: If you write a book, let me know. I am your first customer and reader.

 

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[MTF]

Thank you, @Raoul Duke and @T-K. I appreciate your kind words guys.

 

[tycoon7]

Amazing post, saved it to my favorites list.

After reading it remembered similar advice by Sheldon Adelson (Casino Owner and Entrepreneur):
"Just do things differently. Just do things in life the way other people don’t do. Change the status quo. And then you’ll succeed.”