Foolish Enough to Want to be an Entrepreneur? Be Smart Enough to do it Right!

Entrepreneurial Opportunity:

Many leaders who were used to tackling the previous era problems effectively find these new problems a real challenge. The aforementioned solutions, and also their experiences, are getting rusty. At the same time, entrepreneurship is exploding and prospering. Creating new ventures would have been a lot more difficult in the previous era. The folks with the most resources would have had a more significant advantage.

Things have changed. The business climate today can be considered hostile to the status quo and supportive of disruptive innovation. Entrepreneurs, your days to shine are here!

However, the Entrepreneurial economy to reach its full potential has several major kinks to work out. We are at the edge of a new frontier, but it is still full of pitfalls.

Ironically, one of the biggest hurts for an entrepreneur is a self-inflicted one:

Foolish Entrepreneurs: Wing it!

No wonder most of them sink.

Several different risks combine into the one giant Entrepreneurial trouble that causes a very high failure rate for entrepreneurs. Most of these risks can be, and should be, reduced substantially by preparing for them. The risk mitigation process must be a part of the preparation that should be done before jumping in the fray.

My Pet Peeves:

Just Jump In: Yes, you are aware that the direction is risky. You also know that the failure rate is extremely high. But somehow, you believe your passion (often driven by how much your present job sucks) is enough of a driver for you to succeed. You have been dreaming about being in business for yourself, and a trigger event (like a tiff with the boss) may seem like it is your chance to do it. You jump in.

Not Even Basic Knowledge: My biggest lament is that while a lot of this knowledge is freely available yet, many people jumping into the entrepreneurial arena are not using it. They are either woefully unaware of it (unlikely) or are drawing their totally inadequate knowledge from the popular press (common). Would you be foolish enough to embark on a journey without at least a rudimentary map?

Just Get Me the Money: In sharing stories with fellow mentors, the most common peeve is that the entrepreneur jumps from an idea to ‘get me the money’ without traversing a few essential steps in between. They end up spending oodles of time chasing elusive investors rather than follow the process to take their idea to a fundable plan.

Advice as a Mentor:

Dialog 1: I want to be in business for myself. Any thoughts?

Are you ready for the severe ups and down? “Yup.”

Have you identified an Opportunity? “ I don’t have one yet. Can you suggest a good area?”

Conclusion: Stay with your present job, however much it sucks. Generate a lot of ideas that could be potential opportunities for you now. You can then narrow them down.

Advice: In case you are really serious, here is something to help you decide:

  1. There are a lot of free articles on the risks of entrepreneurship. Google search and read a few.

2. One of the best ways to learn the process is to pay your dues in another startup. You may work part-time or full-time.

Dialog 2: I have an Idea

You are beyond Dialog # 1

Do you have some funds stashed away to tide over till you reach positive cash flow? Can you work long, tedious hours? Can you handle great degrees of uncertainty? “Yes, yes, and yes.”

OK. Are you familiar with the process? “ I have this idea that I have been thinking about for a long time. Can you recommend an angel investor who would be willing to invest in my company?”

What stage are you, tell me your plans. “ Well, at this stage, I only have the idea which I have not shared with anyone because they may steal it. All I am waiting for is the money to get started.”

Conclusion: Stay with your present job, however much it sucks. You have no idea what this other life is.

Advice: In case you become really serious, here are two things to help you decide:

  1. There is a lot of free articles on the common causes of entrepreneurial failure. Google search and read a few.
  2. Many Universities, Incubators, and Economic Development Organizations offer classes on the process of venture creation. Take one to prepare yourself.

If you, an aspiring entrepreneur, do not take advantage of, at least, the free offerings, you have only yourself to blame.

Dialog 3: I have done some work on my idea

You are beyond Dialog # 2

What stage are you, tell me your plans. “ Well, at this stage, I have talked to a few people, and they think it is a great idea. I need to find an investor who can invest in my company to take it forward. I am now waiting for is the money to take it forward.”

Conclusion: Don’t waste your time looking for money yet. Invest that time on building a better case for an opportunity. Please take it as far as possible to an MVP and proof of customer acceptance.

Advice: Here are two things you can do to better prepare yourself, in case you are really serious:

  1. Many Universities, Incubators, and Economic Development Organizations offer classes on the process of venture creation. Take one to prepare yourself better.
  2. Follow a step-by-step process to identify whether you have placed an opportunity for yourself. Institutional Efforts to Fund Startups is Dismal.

Smart Action:

For those for whom the entrepreneurial life is a calling, the smart choice is to do it right. And that means following a process that improves their odds of success. When you look at serial entrepreneurs, they are using a step-by-step process for innovation. These entrepreneurs work in a state of balance by reacting rapidly to the dynamics of societal changes. A strategy provides them with the island of stability in an otherwise unstable world. Things probably will not work out on the first try as you envisage them but, the process itself provides for a pivot, a change, and therefore multiple shots at success. The process has many moving parts, but it still provides a practical and purposeful path from your Idea to an MVP and beyond.

Attention Aspiring Entrepreneurs: There is no excuse for not following a process. Moving into entrepreneurship is not a foolish choice. Winging it is!

Attention Mentees: As a mentor, it is my sworn duty to bring this process to the attention of every entrepreneur, even assuming the role of a Dutch Uncle. In my decades of consulting and mentoring experience, I have used a version or variation of the Opportunity Screening process. If you want a copy of that version, ask me at rajivtandon@yahoo.com.

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Dr. Rajiv Tandon is an Entrepreneur, Educator, and Mentor. He facilitates peer groups for CEOs of fast-growing companies in Minnesota.

Advocate for the future of entrepreneurship in Minnesota. Facilitates peer groups and runs programs for propelling ideas into ventures