SmartAB™ Wisdom #7: Turn Ideas Into A Successful Business
If you ever wondered, what does it take to become an “entrepreneur” and you simply Googled the “e-word” — the familiar search engine returns 4,180,000,000 results. Yes, it is not an error: Four Billion, One Hundred Eighty Million references…
The Oxford dictionary offers some additional definitions such as: “a person who organizes and operates a business or businesses, taking on greater than normal financial risks in order to do so”. And many additional dictionaries such as Merriam-Webster say the same thing…
Well, it’s all true. A lot of ambitious startup founders take serious financial risks before, during, and after they launch their businesses. Yet despite even their best intentions, most aspiring entrepreneurs miserably fail…
Not surprisingly, there’s a ton of information out there describing the desirable traits of great entrepreneurs. The most common attributes are:
· Passionate, Ethical, Visionary, Leader, Innovative
· Risktaker, Decisive, Open-minded (ready to learn and to fail)
· Creative, Persistent, Resilient, Confident, Disciplined
· Self-Aware, Resourceful, Motivated, and the list goes on, and on, and on…
In some of my previous posts about entrepreneurship such as: “REINVENTING XYZ: The Innovative Blueprint For Rapid Transformations” — I stated the following:
“Based on my 30+ years of entrepreneurial experiences, I’m convinced that talented entrepreneurs succeed — when their companies are READY to act and keenly OPPORTUNISTIC. In addition, such companies must also be LUCKY to be at the right time and at the right place — to take advantage of the opportunity at hand”…
Yet, even if all the luck in the world is on your side, and you are truly opportunistic and highly aware of the unfolding opportunities — you also need to pay attention to the KYC (Know Your Customer) factor… And such knowledge is even more important in today’s inflationary environment — when the recession fears are so high…
KYC — It’s Not Just For The Bankers To Know…
According to Investopedia: “Know Your Customer (KYC) are a set of standards and requirements investment and financial services companies use to verify the identity of their customers and any associated risks with the customer relationship. KYC also ensures investment advisors know detailed information about their clients’ risk tolerance and financial position.
Well, there are no KYC rules for entrepreneurship. And while disregarding KYC standards can put negligent bankers in jail or get fired, the ignorant entrepreneurs that do not attempt to understand their customers inside-out — may see their dreams of wealth turn into nightmares of poverty rather quickly…
So, what happens after you did your entrepreneurial research and identified a great market opportunity? Yes, it is scalable and sustainable, it already exists or can be easily created, and it is very profitable and unique. You guessed it: all that remains is to validate that you can profitably access the customers in such markets — with ease…
My advice? Spell all your assumptions clearly and make sure that you can reach your customers under the assumptions you make. And if you know exactly what problems you’re solving — the probability of success just grew bigger…
But remember:
There are plenty of entrepreneurs out there who solve problems without making any money, and there are many entrepreneurs who make a lot of money without solving any problems
So, try to do both: solve problems and make a ton of money while at it…
Assuming that you identified a great Product/Market fit, the success of your business ultimately depends on:
· How well are you going to identify the best customers…
· How well are you going to market your products/services to such customers…
· How well are you going to profitably sell to such customers…
· How well are you going to acquire additional customers…
· How well are you going to retain your customers and at what cost…
Ideas Are Like Frog Eggs
Peter Drucker once said: “Ideas are like frog eggs: you’ve got to lay a thousand to hatch one”. And he was right. Identifying profitable markets and the right customers to profitably sell to — is just the beginning. What follows next is the process of validation…
By demonstrating sizable traction behind your Idea, you essentially validated your initial assumptions about how profitable your markets are and how you can successfully acquire profitable customers. But nothing lasts forever, and you will need to constantly adapt your offerings — to maintain your growth trajectory.
Since 90% of new businesses fail, you’ll need to constantly change your business plans to survive. So, make sure to stay open-minded and surround yourself with experienced advisors and mentors — who have been there before.
One can say that the best entrepreneurs learn all the time. Average ones, only learn from their experience. The worst entrepreneurs — already have all the answers…
And it is equally important to learn from your successes as from failures. After all:
You can’t learn from your mistakes by focusing only on successes, and you can’t succeed by analyzing only your failures…
Hence, I was truly inspired by Dorothy Parker to coin the following phrase: “Entrepreneurship is a cure for boredom. There is no cure for entrepreneurship”
No matter the size of your company, surrounding yourself with smart, pragmatic, honest, and extremely diversified Advisory Boards — is as important, as hiring the right employees.
And as I mentioned in: Two Heads Are Better Than One, all the entrepreneurs that fly solo, or are quick to dismiss the outside help by saying that they already have an advisor — I frequently point out to them that it is like saying: “You bought a business book sometimes in the past and don’t need to look at another one…”
In Conclusion
No amount of Research, Planning, Productizing, Financial Modelling, and Execution is going to help — if you don’t zero in on great markets and identify profitable customers that you can easily reach. Never forget…
For More Information
Please see my additional posts on Linkedin, Twitter, Medium, and CGE’s website.
AI Boogeyman
You can also find additional info in my book on amazon: “AI Boogeyman — Dispelling Fake News About Job Losses”, and on our YouTube Studio channel… Thank you.
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“Data gives us the facts; Facts give us information; Information gives us Knowledge; Knowledge turns into Wisdom, and Wisdom offers an ultimate Advice leading to a better decision” — Oleg Feldgajer
Disclaimer: The opinions are my own. If you require professional guidance about taxation, accounting, or legal issues — please contact qualified lawyers and certified accountants. Thank you.
