Amid the buzz of fundraising, pitches, startups, and hackathons, it’s easy to overlook the ordinary nature of most entrepreneurial endeavors. We tend to perceive entrepreneurs as extraordinary visionaries, assuming they possess innate greatness and a clear purpose. But the truth is far from these assumptions. The actual landscape of entrepreneurship contradicts the media’s sensational portrayal. The story of “madame” Tao Huabi is a prime example of this reality.
Tao Huabi was born poor in China. Poor in China, that is, really very poor, so poor that she barely learned to read and write. When she was 20, she got married and moved to another province. After a few years, her husband died suddenly. She found herself alone on the streets with two small children. The only thing she knew how to do was cook. Not haute cuisine; rice, vegetables, with some sauce from her province. Luckily, she lived next door to a large school. She could make rice bowls for the students at lunchtime to survive. And she did survive. She offered low prices, did not hesitate to give away free bowls, and quickly became very popular with the local students, who affectionately called her Gan Ma (Godmother).
With a little money, she was able to open a restaurant. “Restaurant,” here means a few tables in a parking lot. She served only one noodle dish, seasoned with her spicy sauce made from an old recipe from her province. It was a great success. But one day she ran out of the sauce. Her customers refused to eat her noodles. She realized that what they really wanted was her sauce. Besides, more and more customers were asking her to put some sauce in a small bowl for them to use at home.
She was surprised that some customers came to her house just to buy the sauce, so she decided to sell it separately. She gave some free to truck drivers who came to eat at her restaurant, and they talked about it everywhere. Eventually, she closed her restaurant and opened a factory to produce her sauce, which she called Lao Gan Ma (Old Godmother). Today, after many twists and turns, her factory produces for the entire world and generates $190 million in sales. She is a star in China and should be everywhere else. I have a pot of Lao Gan Ma in my cupboard, and it’s delicious.
This story illustrates the five principles of Effectuation, the logic of entrepreneurship:
1- Start with what you have: Stop crying about what you would like to have; instead, look at what you have, even if it is not much, and ask yourself what you can do with it. Mrs. Tao knew very little. She knew how to cook rice, so she started with that. Was that original? No, it wasn’t. But it allowed her to make a living and avoid begging.
2- Think in terms of affordable loss when you act: Do small things, because at least you can do them right away without asking anyone’s permission and taking too much risk. Cooking rice wasn’t much, but it was enough to get Madame Tao going. It allowed her to survive and to imagine new things.
3- Build a crazy quilt: Ask for help and learn to depend on others. Being loved by poor students meant that there were many people willing to help Madame Tao. She was also popular with truck drivers, who spread the word about her restaurant and her sauce. Thanks to this, her advertising budget could be zero.
4- Take advantage of surprises: Madame Tao was surprised that customers wanted the sauce and not the noodles, but she acted on the surprise and offered her sauce alone.
5- Be the pilot in the plane: Being thrown out on the street could have condemned Madame Tao to a life of begging. But she didn’t let the circumstances force her. She did something simple (cooking rice), but that was enough to set her on a path of survival and then amazing success.
This story shows how entrepreneurship can be a great tool for liberation and emancipation, especially for the poor and needy, for those who have been abandoned by the system. Unable to read or write, Madame Tao had no chance of finding a job in a company.
Entrepreneurship for all
But the lesson goes beyond that: I often use the example of Mrs. Tao with managers who are faced with the difficulty of transforming their organization and who tell me that “at their level, they cannot do anything.” If Mrs. Tao, who started in the worst possible conditions, could do so much, what about a manager who has enormous material and symbolic resources? Of course, the situations are different, but still. To quote a beautiful quote from the philosophical tale that is… the movie Ratatouille: “Not everyone can become a great artist, but great artists can come from anywhere.” This formula can be applied to entrepreneurship as well as leadership.
At a time when entrepreneurship focuses on the extraordinary, Madame Tao’s story is a testament to the power of the ordinary. It underscores that far from being the realm of visionary super-heroes, entrepreneurship finds its essence in resourcefulness and adaptability. Madame Tao’s journey embodies the principles of effectuation, emphasizing the value of working with what is at hand, taking controlled risks, fostering collaboration, capitalizing on unforeseen opportunities, and charting one’s own course. Beyond entrepreneurship, Madame Tao’s story resonates as a universal parable of human determination and ingenuity, inviting us to recognize and unlock the potential inherent in both ourselves and the everyday landscape.
To know more about effectuation, read my article here.
🇫🇷French version of the article here.
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