Walk The Line

How far can you push the perfect opportunity?

When a truck dumps half a ton of lemons into your backyard, it wouldn't be an insane idea to start selling freshly squeezed lemonade. But when an unexpected flood threatens to ravage your town, is it right to unload your stockpile of sandbags with a sign on your garage door reading "Neighborhood Special: 3 for $5"? There's a fine line between capitalizing on an obvious opportunity and taking advantage of an unfortunate situation for personal gain. And entrepreneurs-opportunists by nature-often have to risk their reputations (in both the business and consumer worlds) in the name of seizing their chances at success, be it long-term or not.

We talked with some entrepreneurs who've spotted "sure thing" opportunities too potentially prosperous not to pursue and pre-existing businesses blessed by the gods of timing. Some have cashed out, and others didn't generate quite as much interest as they'd hoped for. So can we conclude that when a blatantly opportunistic endeavor fails, it's because the quality so many successful entrepreneurs swear by-having passion for a venture-was absent, and that consumers can smell a gimmick devoid of value miles away? Or is spotting an opportunity and capitalizing on it, by any means, rewarded and applauded in this Survivor era? A scientific answer, there is not. Each entrepreneur must be his or her own judge-and await public opinion, of course.

Why Are You Doing It?

There's no doubt it's possible to make fast money capitalizing on a craze, but in Randy Komisar's mind, the validity of a business relies on its ability to create value for customers. Komisar (at right) left his CEO position at video game company Crystal Dynamics to help get start-ups off the ground until they find permanent CEOs. In his book, The Monk and the Riddle (Harvard Business School Press), the 46-year-old Silicon Valley veteran narrates his dealings with fictional character Lenny, an opportunist looking to get in on the Internet craze who approaches Komisar with his proposal for the next billion-dollar business idea: Funerals.com. Says Komisar, "[Throughout the book], we work through what [Lenny's] true passion is and incorporate it into a business opportunity that is much more interesting to him and something he can really commit to."

While Komisar admits business isn't all about doing things out of the goodness of your heart, the goal of making money should merely be the physics of business, while doing something useful to society should be the purpose of it. "Profits, growth and opportunities for employees and investors are all very valid and all tend to work well when founded on bedrock," says Komisar. "The problem is, in an exuberant market like the one we just came through, greed overwhelms intelligence a lot. And as a result, you end up with a lot of people who are just looking to cash in and cash out and aren't thinking about building real value or long-term opportunities for themselves and others."

Robert D. Hisrich, professor of entrepreneurial studies at Case Western University's Weatherhead School of Management in Cleveland, says it's ultimately up to the public to determine the worthiness of an entrepreneurial endeavor and up to the entrepreneur to act responsibly. "I don't think we should have an expectation that everything produced in a society is going to have some significant impact," says Hisrich. "But what I think we need to expect is that when entrepreneurs create services and products, they maintain ethical standards in their business dealings and their treatment of customers and employees. As long as those ethical standards are maintained, then the [company's] output-as long as it's not harmful to society-is [there for society] to judge whether or not [to] buy it."

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This article was originally published in the April 2001 print edition of Entrepreneur with the headline: Walk The Line.

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