By Ashley Merrill, founder and CEO of Lunya and principal investor at NaHCO3
My professional and educational experiences took me from art history school to culinary school to venture capital to online media. I've always described myself as someone who is a balance of right and left brain -- drawn to things that fuel both the creative, visual half and the logical, numbers half.
My right brain took me to art history and culinary school, while my left brain took me into the world of venture capital and online media. When I took the leap into entrepreneurship, it leveraged my logical and creative brain in solving a problem I felt passionate about.
I founded my company in 2012 to bring stylish, functional sleepwear to women around the world. My conviction toward creating real value helped me stay laser-focused and, in turn, helped me achieve business success. Throughout the past few years, I’ve been lucky enough to be an investor in many high growth companies and connect with a network of fellow entrepreneurs. This exposure and my firsthand experience have yielded me some do's and don'ts of building a successful business.
Here are the questions I asked myself before taking the plunge into entrepreneurship and the lens I look through when considering investing in an entrepreneur. If you’re chewing on your own business idea, perhaps these questions will help.
Does your idea solve a real problem?
Take it from Richard Branson, who knows a thing or two about entrepreneurship. He famously said, “Launching a business is essentially an adventure in problem-solving.” When you solve that problem at scale, you create major value for your customers and grow your business at the same time.
Brian Chesky and Joe Gebbia rented out an air mattress in their apartment, and it eventually became Airbnb. Sarah Blakely cut the feet off her pantyhose, and it became Spanx. Donald Fisher couldn’t find jeans in his size at the local Levi’s store, so he started Gap. Not every problem-solving company becomes a titan of industry, but I do believe this value-driven intent leads to better outcomes. So, solve a real problem.
Will your idea make a profit?
Businesses need to make money to survive -- it's as simple as that. As principal of a venture capital firm, I see many prospective business plans that try to capitalize on the founder's passion for a given space, rather than conveying an impactful product or service.
Viable businesses need to make money (or have the potential to do so in a significant way) if they are seeking outside capital. Passion can keep you pushing uphill when times are tough, but it’s not going to keep the lights on.
People are willing to pay for improved ways of addressing everyday issues. It comes down to basic supply and demand: Do you have something that people want and are willing to pay for?
Are you starting this business for the right reasons?
This is a “know thyself” moment. Take the time to unpack why you’re starting this venture. Getting a company off the ground is not for the faint of heart. You have to start from nothing and be prepared to grind. Starting a business is rarely a shortcut to get rich quick on a flexible schedule without working for anyone else.
I find that great businesses are in it to solve a problem. It’s motivating for the founder and employees and keeps everyone trucking along even when things get tough.
Do you want it badly enough?
They say entrepreneurs are the only people who work 80 hours a week to avoid working 40 hours a week. A recent QuickBooks study found that 27 percent of entrepreneurs work 50 or more hours per week, 33 percent work every weekend and 22 percent miss a family function or social event a few times per year for work. I don’t say this to be discouraging, but to prepare you for the sacrifices you will undoubtedly face.
Mindset is everything. I know because I’ve seen it in myself and others. Entrepreneurship has the capacity to be rewarding and fulfilling, but you are guaranteed to be pummeled with challenges you don’t think you can overcome. Those who want it badly enough bounce back.
Make sure the idea is connected to who you are today and who you want to be in the future. You and your business must be thoroughly aligned to make an impact.
If you feel confident in yourself and your idea after passing it through these questions, go for it. Entrepreneurship can be very rewarding and the world needs more business to solve the world’s problems.
Ashley Merrill is powering opportunities for women and girls as founder and CEO of Lunya and principal investor at NaHCO3.