A few months ago I wrote about my 9 business selection criteria for evaluating business ideas. After some deliberation, I have decided to relax the selection process. Specifically, as long as the idea has massive mass market appeal, I am now willing to start businesses where the business model may not be clear and understood from the get go.

While relaxing the criteria, makes the project riskier, strict adherence to the philosophy would mean that I would have passed on Google, Facebook and MySpace. Again, this conclusion is highly personal. To some extent I have already succeeded and as a result am willing to take more risks in order to increase the probability of a home run even if it decreases my batting average.

My willingness to take more risk is clearly demonstrated in running OLX and funding Allmydata – the former is in an extremely competitive market with entrenched incumbents, the later is also in a competitive market whose size and viability is yet to be proven – even though both of them, a priori, have clear business models.

A first time entrepreneur may want to keep the selection criteria to increase his probability of success and set the stage for future successes.

In a recent interesting book “The Hypomanic Edge: The Link Between (A Little) Craziness and (a Lot of) Success in America” author John D. Gartner, an assistant professor of psychiatry at John Hopkins, argues that America’s success is because American entrepreneurs are largely hypomanic.

“Hypomania is a mild form of mania, often found in the relatives of manic depressives. Hypomanics are brimming with infectious energy, irrational confidence and really big ideas. They think, talk, move and make decisions quickly. Anyone who slows them down with questions “just doesn’t get it.” Hypomanics are not crazy, but “normal” is not the first word that comes to mind when describing them. Hypomanics live on the edge, between normal and abnormal.”

So why are Americans hypomanic? “Energy, drive, cockeyed optimism, entrepreneurial and religious zeal, Yankee ingenuity, messianism and arrogance – the traits have long been attributed to an “American character.” If a scientist wanted to design a giant Petri dish with all the right nutrients to make hypomanic genius flourish, he would be hard-pressed to imagine a better natural experiment than America. A “nation of immigrants” represents a highly skewered and unusual “self-selected” population. Do men and women who risk everything to leap into a new world differ temperamentally from those who stay home? It would be surprising if they didn’t.”

How do you identify a hypomanic? Gartner lists these traits: “He is filled with energy; flooded with ideas; driven, restless and unable to keep still; channels his energy into the achievement of wildly grand ambitions; often works on little sleep; feels brilliant, special, chosen, perhaps even destined to change the world; can be euphoric; becomes easily irritated by minor obstacles; is a risk taker; overspends in both his business and personal life; acts our sexually; sometimes acts impulsively, with poor judgment, in ways that have painful consequences; is fast-talking; witty and gregarious; charismatic and persuasive; prone to making enemies and feels he is persecuted by those who do not accept his vision and mission.” Sounds like an entrepreneur to me 🙂