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  The Entrepreneur's Guide to Finance

The Entrepreneur's Guide to Finance and Business: Wealth Creation Techniques for Growing a Business
by Steven Rogers

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In a recent Kellogg School interview, Professor Rogers discussed in more detail his new book and the importance of entrepreneurship.

Kellogg School: You write in the preface of your new book about your mother, Ollie Mae Rogers, and how she provided your first glimpse of entrepreneurship as you helped her with the family's used-furniture business. Do you think you would have had the career you've had without her influence?

Prof. Steven Rogers: I don't believe so. The reality is I'm a product of not only my nurturing, but the DNA of my mother and father, in particular my mother. I have her strong genes relative to independence. Independence is not something unique, but the combination of having that independent gene, the entrepreneurial spirit and experience is awfully powerful. It's no coincidence that, in one form or another, all my siblings have tried entrepreneurship. It's just a part of how we define ourselves. I literally had training in the world of entrepreneurship, in the world of business ownership, at an early age, so there was no fear and intimidation later. The training was essential - being in charge of furniture stores and working in flea markets and interacting with customers was my boot camp.

You mention in the book something you call "putting meat on the carcass" - adding real-life experience to flesh out the theories and models that are so much a part of academic life. How did your approach to teaching and your real-world experience shape The Entrepreneur's Guide to Finance and Business?

SR: The field of entrepreneurship is ideally taught by those who've been entrepreneurs, and/or those who've had a close, direct relationship with entrepreneurship as an investor or adviser. The ideal is to have a combination of the practical and the theoretical. One of the things we try to do here at the Kellogg School is make sure those who have practical entrepreneurial experience and who are engaged in the teaching of entrepreneurship don't simply tell "war stories." We require that they teach theory as well. Therefore, hopefully my book is the ideal entrepreneurial book in that it is written by one who understands and can teach the theory of the fundamentals of business, combined with the practicality of business.

What skill or skills are most potential entrepreneurs lacking?

SR: I think the greatest skills that entrepreneurs lack are those related to finance. Most entrepreneurs are people who are great at marketing or who have a great product or service in mind. It's not uncommon to hear entrepreneurs say, "I don't know anything about finance. I let my CFO, I let my bookkeeper, I let my accountant do all of that." And the reality is that's a poor way to run a company. You'll ultimately get burned. As I say in the book, the financial aspects of running a company, the fundamentals of finance are not brain surgery. Everybody can and should learn them, including all entrepreneurs.

Americans are known for their resourcefulness, independence and entrepreneurial spirit. You add to that the fact that the 1990s, with the dot-com boom, saw a large burst of entrepreneurial activity. What things attract people in this country to entrepreneurship?

SR: The primary attraction is the desire to be independent. Most people become entrepreneurs because they want to be responsible for their own success or failure. The second reason people probably become entrepreneurs is because of the interest in wealth creation. I want to make it very clear and the book states this fact: Most people do not become entrepreneurs to get rich. They become entrepreneurs for intangible reasons related to personal satisfaction and lifestyle. They want to have independence from someone else telling them what to do and they want to be responsible for their own success. It's not money that drives it. One of the things we saw in the dot-com era was this euphoria around entrepreneurship that was, in my opinion, unhealthy, in that a lot of it was driven by the desire to become wealthy, but not driven by the desire to have a company and to build something. And the reality is, if [making lots of money] is the motivation, then people won't be entrepreneurs very long.

©2001 Kellogg School of Management, Northwestern University