University of Arkansas

Walton College

The Sam M. Walton College of Business

Revisiting the E-Myth

Women sitting at a computer and stressed
January 11, 2024  |  By Stephen Caldwell

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Note: This is part of a series of Walton Insights reviews of classic books on business and leadership.  

Twenty-plus years ago when I began contemplating the idea of starting my own business, someone – I wish I could recall who it was – recommended that I read The E-Myth: Why Most Small Businesses Don’t Work and What to do About It by Michael Gerber.  

The book, based largely on the consulting work Gerber had been doing since 1977, came out in 1986, but by the time I got to it in the mid-1990s he had released a revised version (The E-Myth Revisited), so that’s what I read.  

The company Gerber founded is still going strong with coaches and training programs, primarily for owners of small businesses. And the core message of the book remains strong, too. The world continues to change, but the fundamental issue Gerber addresses hasn’t gone away: owners of small businesses tend to depend far too much on their own ability to produce results.

People often start a business because they want to make a career out of something they enjoy and do well. They are “technician owners” – they love baking or fixing pipes or practicing law, and they are really good at the technical aspects of that work. But they buy into the entrepreneurial myth that loving the work and being good at it are enough to create a sustainable business.  

A successful business, of course, requires more than a great technician. And it also requires more than a visionary founder with a great idea. Someone, and in the beginning it’s usually the owner, also must manage and grow the business, and that means overseeing operations and finances, formulating goals, and developing a strategic plan, as well as casting a vision and being the worker bee. 

Gerber lays the foundation for dealing with these issues by first describing the differences between an entrepreneur, a manager, and a technician in a startup business. Then he walks the reader through the stages of a new venture. In the last section, Gerber outlines a business development process, which I found extraordinarily practical. 

My takeaway is that successful owners must figure out what to do with the different “hats” that must be worn for a business to thrive. If you start a business making pies and never get to make them because you are always working on marketing or accounting challenges, you might find yourself miserable – and you won’t have enough pies to sell. On the other hand, if you just make pies, you will enjoy your work but you probably won’t stay in business long. So, embrace the other hats until the time comes to hire folks who can wear them.

At the time I first read the book, I thought I would build sort of a consortium of writers and editors and we would provide our services to the people and businesses that needed them. I ended up building a much smaller version of my original vision, primarily because I decided I didn’t want to spend all my time managing people and projects and chasing more work for them to do, even if that would have been a more financially lucrative way to go. 

Interestingly, when preparing to write this review of the book, I came across an “e-myth” plan I created more than two decades ago. The fact that it has held up so well is perhaps the greatest testimony I can give to the book. Did I meet all my goals? No way. I aspired to have $2 million in the bank by 2023, and let’s just say I’m not quite there, yet.  

That’s OK, because when it comes to my “primary aim,” I’ve pretty much hit the bull’s eye. Opportunities to write on topics in my areas of passion? Bull’s eye. Flexibility to spend time with family? Bull’s eye. Flexibility to travel for missions? Bull’s eye. 

The fact is, I didn’t need to start the type of business that scales. I needed to start a business with a limited number of employees (me and a few sub-contractors) and manage the growth in accordance with my lifestyle aspirations. The E-Myth Revisited helped me see that and do it, while also providing tips and best practices that have served me well as a solopreneur for the last 20 years.

Matt WallerStephen Caldwell is Chief Word Architect for WordBuilders, Inc., where he spends most of his time helping clients discover, craft, and share the messages of their hearts. In addition to writing and editing for newspapers, magazines, and on numerous book projects, he has developed leadership and functional training for Fortune 500 companies. He lives in Fayetteville, Arkansas.