Diversify or focus?

Ateneo Professor on Entrepreneurship

Rizal Philippines
October 5, 2019

Focus or diversity?

Focus means staying with one business and making only investments related to the business.   Focus is risky because you are putting your eggs in one basket.   The Zurich axiom says that you must bet on few eggs that when they hatch promise big returns.   If you spread too thin across many risks then you get thin returns.

The other is diversity  by investing in various portfolio or lines of business that spreads risks across various businesses.  Ie  that of being conglomorate like ITT or Warren Buffets stocks that span across insurance, publishing, coke, and even trains.    But takes a lot of skills to manage various businesses just like what ITT found after Harold Geneen left.  

But you can see that famous moguls are into focus like Bill Gates - computers and software,  Steve Jobs - computer, Li Kai Shing  real estate development;  Ali Baba -  E commerce.  For many start up young entrepreneurs I have seen many of them diversify so early so soon in businesses that they do not understand, or too risky to make money for them.   I think a good businessman should be able to have a BP in his head even if he sleeping because he/she has focus

Our first session at MBAH entrep

Ateneo Professor on Entrepreneurship

                                     The judges in the debate;  Bong (2nd from left is fmr seminarian)

I met the students for MBAH entrep today. Several backed out/transferred (They do not know what they gonna miss)

I spent some time explaining why this subject is important and the relevance to their practices vis a vis the rapidly changing business environment, and what will they do when they lose the ability to operate, let us say, or there is change in career.

Then they introduced themselves, with the emphasis on what they love to do, their passion.

Then we had the debate whether entrepreneurs were born made or simply fortunate or result of luck.  The made group won.

Then we walked through the syllabus;  they value their privacy and we would selective submission at the blogs.  The others would be hard copy only

                                The group said, entrepreneurs are born

                                      "They are made"  they won the debate

                                       The "suwerte" group at the back