Most of you aspiring entrepreneurs probably have long searched for that special idea that will catapult you and your startup to success.
Yet, my experience as a business advisor and investor has convinced me that the magic is not in the idea, but in you and the execution. I have seen people with mundane ideas hit it big, and really great ideas implemented poorly, with disastrous results.
For example, most people thought Twitter was a total snoozer, when Jack Dorsey was looking for funding--especially with MySpace already owning that territory. Yet today, Twitter is a $50 billion behemoth, and MySpace is forgotten. On the other hand, most people thought Segway was the next big thing back in 2001, as an electric "personal transporter," but it has yet to find a foothold.
After some meditation, I decided to offer you here my own perspective on some of the top misconceptions that I hear all too often from passionate, smart people on what it takes to start a successful business:
1. A successful business is all about the right idea.
Contrary to popular belief, there is no shortage of good ideas out there. Every investor I know hears the same ones over and over again. The shortage is of people and teams who can turn an idea into a real business. That takes focus, resolve, resources, and problem solving.
2. True entrepreneurs are born, not made.
It's true that some people are natural risk-takers, but these people often do not make the best entrepreneurs. I like people who do their homework first, and take calculated risks, rather than closing their eyes and jumping. You can learn to be an entrepreneur by working in a startup, talking to peers, and mentoring.
3. Every inventor is an entrepreneur by default.
In my experience, inventors tend to be highly focused on technical issues, and not necessarily interested in or good at business implementation requirements. For technical innovators, I often recommend finding a partner with deep business savvy. This is a clear case where one plus one equals three.
4. New businesses are expected to be chaotic.
The best new businesses I know are carefully planned and managed, no matter how innovative they are. The challenges may be unpredictable, but they must be resolved in an orderly way, through people with the right skills and mindset. Businesses that are always in chaos are at a high risk of failure.
5. A first success leads to low risk on the second.
With innovative startups, every new one is a new challenge. Even great leaders tend to assume that a formula that worked once will work again. In reality, every startup brings new unknowns, new people, new competitors, and new customers. Don't get overconfident that you now know the magic.
6. True innovation requires breaking the current system.
I find that most new business successes minimize breakage. They do, however, most often look outside the box of their own domain to bring in new business elements from other domains. For example, many products are now offered by subscription, which was a concept from the services world.
7. A smart team assures entrepreneurial success.
Even with the most capable teams, keeping the big picture in perspective, making hard decisions, and providing a strong image requires strong leadership from the founding entrepreneur. Of course, you must hire the right people and really listen to them, but don't expect them to do your job.
8. Enjoy the flexibility to make your own decisions.
Starting a new business does put you in control, but you will face a harrowing new set of demands from partners, investors, suppliers, and customers. These can consume a greater part of your life than a simple 40-hour week, and you can't hand off the decision challenges that you don't like.
9. After startup, a business must minimize change.
Today, the only constant in business is change. Every entrepreneur must define repeatable processes to stabilize the business, but must never be satisfied with the status quo. Markets, customers, and competitors evolve, and you must continually update the business to stay ahead.
10. Look inside your organization for spinoffs to grow.
People embedded in an existing business are often too narrowly focused, comfortable, and risk-averse to be new entrepreneurs. An internal business expansion is often incompatible with established operations, which is why mergers and acquisitions are the most common scaling strategies.
You should never allow any of these challenges to discourage you from the joys of entrepreneurship, including the satisfaction of working on your passion, and getting the feedback on having made the world a better place.
We all need and look forward to your ideas, your innovation, and your implementation. Keep going and have fun!