Some say entrepreneurs are born, not made. But with the barriers to entering the world of entrepreneurship lower than ever, that’s no longer the case.
Everyone has different reasons for starting a business. But before you try to execute on your great idea, or leave the comforts of your day job to pursue your passion, you should know this:
It’s not easy.
Recently I spoke with serial entrepreneur Christopher Engman. Christopher lives in Sweden, where he founded his first company at the age of 25. I reached out to him after watching the following video(https://youtu.be/Hzk0Kcm9tx4), where he speaks candidly about the challenges, pitfalls, and lessons learned in starting a business. (If you’re interested in my own story, you can read it here.)
In a few short minutes, Christopher captures a great deal of the experience of entering the world of entrepreneurship. If you’re considering starting your first business, his advice is excellent food for thought.
So, before you take the plunge, here are a few things you should know:
1. You’re going to fail.
At least half of you will, anyway–in the first five years (according to the latest data from Gallup). Like many entrepreneurs, Engman didn’t succeed on his first attempt. In fact, he lost his first company, and ended up with over 100,000 dollars of debt.
Hopefully you won’t end up in that situation, but the truth remains: If you’re not ready or willing to fail, entrepreneurship isn’t for you.
2. Don’t start with an idea. Start with a problem.
Like many of us, Engman’s ideas about entrepreneurship changed once he became one.
“If you ask a lot of entrepreneurs, they think they started with an idea. They actually didn’t. They were discussing a problem with their friends; then, the idea came.
Start with a problem. Not an idea.”
If you’re serious about starting a successful business, find a problem that lots of people (or businesses) have. Then, work hard on finding a solution to that problem. That’s your starting point.
3. Persistence is golden…if you’re willing to tweak.
Ideas are a dime a dozen. What’s difficult is to bring that idea to fruition at just the right time. (Don’t believe me? Bill Gross presents some engaging research in this 2015 TED talk.)
After his first company went bankrupt, Christopher restarted it…with basically the same business idea. This time it worked. What made the difference?
“Some people say you should never give up. And I agree…you should never give up on yourself. But sometimes you have to give up on a certain concept you created…and tweak it.”
What we know today as PayPal originally launched as Confinity, a company that developed security software for handheld devices. Google was unprofitable for years before launching its AdWords program in 2003.
If your idea doesn’t succeed the first time, success may be just around the corner. Don’t be afraid to pivot when necessary.
4. Start small.
It’s easy to get carried away with grandiose visions of what your company is going to bring to the world. But remember, Rome wasn’t built in a day.
“Start with a small target market,” Engman says. “Your business model should be applicable for a big market. But don’t try to prove it with many at the same time.”
If you think you have a solution to a problem, forget about marketing (for now). Reach out to a few people who have that problem. If they’re willing to try your product or service, you’ve got a way to prove your concept.
5. Play the long game.
I like Engman’s comparison of building a company to playing chess:
“Sometimes you have to change your game plan as things happen. You don’t go for the queen in the first push. You make a lot of moves, and then you go for the queen.”
Or, as legendary boxer Mike Tyson allegedly put it: “Everybody’s got a plan until they get punched in the face.”
Yes, entrepreneurship is a mix between strategy and a street fight. Build your strategy. But know that sooner or later, something unexpected will throw you off.
Roll with the punches, and show us what you’re made of.