You have an amazing idea. The most amazing idea of your life. An idea that will change the world.
With great reluctance [mistake #1: reluctance] you tell a few trusted friends, all of whom say something between “maybe” and “nice idea”. You take all that as feedback that you are on the right track [mistake #2: happy ears].
You dip your toe into market research, and carefully share your idea with a few potential customers. Most agree you have something interesting. [mistake #3: most is not a number].
On and on, perhaps a survey later or wider set of conversations, and you have convinced yourself that you’ve got the next big thing. Convinced that as soon as you have the product in hand (or service in cloud), the sales will start rolling in.
You’ve read the news for years of overnight successes: Facebook, Twitter, Instagram, WhatsApp; FarmVille, Angry Birds, Candy Crush; eBay, Amazon, and once upon a time, Yahoo. [mistake #4: dreaming of winning the startup lottery]
I’ve seen this story hundreds of times before, and keep seeing it in every entrepreneurship event I attend. Lived this story a few times myself, way back, when the success stories were Atari, Lotus, and Palm.
Somehow, each wave of entrepreneur continues to make the same mistakes, and most follow the same pattern from idea to failure, rather than idea to sustainable company. Let’s quickly look at these mistakes, so that you don’t repeat them yet-again.
#1- Reluctance to share. First-time entrepreneurs are too often afraid that their amazing idea will be stolen. First off, with seven billion people on the planet, at least 10% entrepreneurs, your idea is likely not unique. Either way, there are at least six billion people who’ve yet to think the same idea, and they have ideas, advice, and feedback you need to turn your good idea into something great.
#2- Happy ears. If everyone is telling you your idea is good/great, then you are asking the wrong questions. The only exception to this is if their wallets are open at the end of the discussion and they are insisting on buying what you are building. If that hasn’t happened, then ask them what is missing. Seriously, what will it take for you to whip out your Bitcoin wallet right now and pay for this blog post? (16x8PHgkYbNHB2Z6bS6XDRoM4G8JCzGNz4) You need to be that direct to understand what is truly needed by customers.
#3- Most is not a number. No amount of surveys will ever tell you if customers will by your product/service. Eric Reis is dead on correct. The only useful market research is a sales call with a purchasable product in hand. Your happy ears will quickly disappear when 90%+ of conversations/interactions do not end in a purchase, and that trackable number will tell you whether you inevitable changes are helping or not.
#4- The Startup Lottery. If you are an entrepreneur to build the next Instagram/WhatsApp, I highly suggest a day job and a weekly Powerball ticket. The odds are just about the same and the level of stress much lower. Starting and building a startup is an all-consuming lifestyle. Founding a billion dollar startup literally has odds lower than one in a million. If you are going to spend the next 5-10 years of your life devoted to a startup, work on something that makes a difference in the world. Something that makes you proud to wake up in the morning and get to work. Something that your mom will brag about to her friends. Build a profitable, sustainable business that can still be running in 5-10 years, rather than a business whose only purpose is to be “flipped” into the last wave of overnight successes, and quickly thrown away or assimilated into a tiny feature.
No one need repeat these mistakes again. It’s time we move on to the next set of mistakes. 🙂
If you disagree, then send me a message via Lotus Notes on my Palm Pilot, or better yet, enter it into the Disqus discussion box below…