Startup Myths of an aspiring entrepreneur
An aspiring entrepreneur has an idea which can solve the pain of a number of customers. This startup entrepreneur has to cross the threshold and leap into executing this idea by mobilizing resources.
Sometimes the idea never makes it past the planning stage.
This transformation is all the more traumatic for an executive who would like to pursue entrepreneurship. The higher the position the executive occupies the more difficult it is, to take the first step on the ladder and the family aspirations compound the problem. To be or not to be is the million-dollar question.
Their inaction could be based on several honest wrong beliefs- we call them myths.
Image Source: Stuart miles
üAny invented story, idea, or concept.
ü An imaginary or fictitious thing or person.
ü An unproved or false collective belief that is used to justify a social institution.
“One of the biggest problems startups face is that they invest time/energy/money into an idea under the false premise that they will be the first/only company in that market within a given window of time. In most cases, this is simply not true. By talking to people (that you trust at some level) and discussing your idea, you’ll get a better sense of who is out there doing similar things. Some of these could be competitors – but some could also be partners, customers, acquirers, etc.” – Daniel Howard
Many aspiring startup entrepreneurs think by becoming an entrepreneur they can be their own boss and can do whatever they want. Initially when a business is launched this heady feeling gets a jolt. You have to meet the expectations of all stake holders and some of them do not give freedom to do whatever the startup entrepreneur wants.
The key resource person, supplier and investors take away entrepreneurs freedom. The very fact that the entrepreneur is dependent on them for various aspects of his business, makes it impossible for him to have a free run.
Statistics show that more than 90% of existing businesses are based on known or a copy of the existing product or a service.
We have several dozens of soaps, shampoos or restaurants but each and every business is growing and acquiring new customers.
A study of the market by a startup will show that many new features or uses can be a differentiator to succeed.
The classic example of Apple which never believes in a low cost product. Their secret weapon is Innovation which helps them to succeed in this highly cluttered and crowded market.
Investor has seen many startups approaching them with similar ideas.
The investors look at the entrepreneur and the team’s capability to execute the idea.
A bad idea can turn into a money spinner by a team with superior execution skills.
A startup with an excellent idea was funded by an angel. After two years, when the business was growing, the startup had a rude shock when the investor insisted on replacing the owner with a Professional CEO. The investor assessed the skill sets for starting and growing the business were different and the owner was lacking in those skills. ( A real life story)
The startup bootstraps the company. The initial network of family, friends or ex-colleagues help in getting the initial customers. The business gets stuck and acquiring new customers becomes a daunting task. There could be several reasons for this, like the competitions’ new product launch, change in the needs of the customer or the inability to target right fishing hole.
The over hyped social media as low cost marketing tool has made
startup entrepreneurs feel that spreading word, is an easy task. In reality entrepreneurs
fail to assess whether their product or
service belongs to ‘nice to have category’ or’ must have category’. Each of
this needs a completely different marketing strategy.
A few technical entrepreneurs get excited about their idea and invest their savings to launch the alpha or beta stage of their product. Suddenly they find that their initial capital is not adequate and waste a lot of time in approaching investors. This may result in the closure of business. Initial planning of funds requirement or getting support right at the beginning is crucial.
Image Source: Stuart Miles
A startup myth based on honest wrong belief can shatter the dream of an entrepreneur. Look before you leap. A business coach or a mentor or a trusted family member can help in making the startup journey a little less stressful.