Do entrepreneurs need to be generalists or specialists?

The apparent conflict between being a specialist versus a generalist is something that has been discussed for some time now, with the catalyst typically being the increasingly deep well of knowledge required to function in a particular field.

What began with The Wealth of Nations and the lauding of specialization has taken on a new hue as the amount of knowledge has increased.  To excel in a particular area, therefore, often requires you to specialize in ever narrower niches.

Specialist versus generalist

Whilst this may be great for known tasks, it’s less effective for unknown areas such as innovation, whereby the ability to be recombinative requires a more varied perspective on life, so that you can pull in ideas from disparate fields and apply them to your own.

This paean to the generalist extends itself into entrepreneurship, as we believe the best entrepreneurs have the ability to see the wider picture, and therefore spot where new ideas can thrive.  Such generalists also have a range of skills, which in those early days of their startup are crucial when manpower is low and people have to contribute wherever they can.

Of course, not everyone buys into this, and a common refrain is that generalists are a Jack of all trades, master of none.  Their knowledge is of the superficial variety and in no topic area do they have a deep enough level of knowledge to succeed.

The ideal entrepreneur

A recent paper set out to test the theory in more depth.  The paper finds that generalists don’t have any specific advantages when it comes to entrepreneurship, but that those with the right mixture of generalism and specialism do.  The authors suggest that the ideal combination involves the classic t-shape, whereby the entrepreneur has a broad level of general knowledge, but one area of deep specialist knowledge.

They suggest that specialist knowledge of the market is ideal when combined with a more general knowledge of the tasks needed to bring the idea to market.  This combination brings credibility that they know their stuff, whilst also affording them an understanding of the customer.  It’s crucial to have deep knowledge in this area, much more than it is to specialize in how to develop the product or idea.

In practical terms, this might mean an entrepreneur who has worked in multiple jobs in their field, and therefore has both a strong functional and general knowledge.

Of course, it should be said that few startups operate with a single person running the show, and I’ve looked previously about research into the makeup of startup teams.

The paper, published in Science, focuses on the people that join the founding team, and the crucial role they play in the success of the venture.

The study reveals that this second wave of recruits often share the risk taking spirit of the founders but they come with some crucial differences.

For instance, they tend to focus much more on operational roles, such as R&D, rather than management.

“Sometimes you can have a single founder who handles the full range of activities for a startup, but especially in technology you need additional people to research and develop the products,” the authors say. “There are many people who are interested in working for startups but who don’t want to be founders.”

Maybe therefore, it isn’t necessary to have the ideal mix in one person, just so long as you have it within your team.

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