Pick a direction. Get started. Keep going.
- May 20, 2014
This should get bumped every week.Do You Have a Successful Entrepreneurial Premise?
The most common mistake aspiring entrepreneurs make is to approach entrepreneurship with the wrong premise. You've heard the doom-and-gloom statistic that 90% of all new businesses fail in 5 years. While this stat is disheartening, it can empower you to become the minority 10% who don't fail by understanding why most do.
Quite frequently I read posts from people, albeit well-intended, with grandiose goals of making a fortune by starting a business. You've heard the countless questions repeated dozens of times:
If you find yourself sitting around asking yourself these types of questions, your entrepreneurial premise more than likely will lead you into the 90% failure category. Why? An entrepreneurial premise predicated on money is like building a house on sand; it's likely to come crumbling down. Start with a weak foundation in any task and your odds of failure increase.
- How can I make money starting a business?
- What business can I start with $200 and still make $5K per month?
- What home-based business can I start?
- I have a friend who manufacturers widgets; you think I can make money selling them?
- How can I make a passive income?
- What's a good product to sell on Ebay?
- What's the best business to start on a shoestring?
Fastlane Principle: Selfish premises do not make good, long-term business models.
Businesses should not be created to make money. Businesses should not be created to satisfy your desire to “do what you love”. No one cares about your selfish ideas about dreams and making money. The world doesn't care about your business, your desire to make money, and your dreams of owning a business “doing what you love”. Again, no one cares!
What people DO CARE about is what your business can do for them. How will your business help me? What's in it for me? Will it solve my problem? Make something easier? Provide me with shelter? Save me money? Educate me? Make me feel a certain way? Tell me why should I give your business money for your product or service?
The problem with new business owners is they create businesses based on the faulty premises; faulty premises that don't lead to profitable business.
“I need a new income stream”Wrong. Wrong. And wrong.
“I’m an expert in [blank] so Ill do that"
“I read a book and it says to start a business”
Fastlane Principle: You begin to attract money when you STOP BEING SELFISH and turn your business focuses from the needs of yourself to the needs of other people.
Businesses don't attract money -- businesses that solve needs do. If your goal is to attract wealth ethically and with integrity, selfish motives, albeit a powerful motivator, won't serve you well to attract great wealth.
Money is a like a mischievous cat; if you chase it around the neighborhood, it eludes you-- hiding up a tree, behind the rose bush, or in the garden. However, if you ignore it and focus on what attracts the cat other than the cat itself, it will come to you and sit right in your lap.
The foundation of all highly successful business is the satisfaction of consumer needs as reflected by sales in the marketplace. The marketplace-- people, not you-- determine if your business is viable. If you sell 10,000,000 of Product XYZ, 10,000,000 people have voted that your product will help them, or satisfy one of their needs. People vote with their money.
Fastlane Principle: Focusing on the needs of others is the only entrepreneurial premise that improves your odds of business success.
Growing wealth germinates by solving needs on a massive scale, or in a highly impactual way. It could be as gigantic as starting a software company like Bill Gates or Larry Ellison, or something seemingly minute like putting a new spin on something old. If you own a website that services 10,000 people daily, you're making an impact. If you own real estate company that provides housing to 1,000 people, you're making an impact. Make a freaking impact!!
Is this an all-inclusive rule? No. Exceptions exist. Many profitable businesses are founded on greed -- however profit in the name of greed and selfish interest usually lands those companies on the television or in the Better Business Bureau complaint files. Consumer greed also exists and greedy business owners can serve this demographic well (The all too popular consumer mantra: "We want the best price" often ends up as a scam or services rendered poorly.)
The objective of this post is to increase your odds of business success. While you can chose to ignore this advice and continue moving forward with selfish interest, I'd speculate your failure odds are inline with the stats -- 90% -- whereas moving to an unselfish premise might increase it to 50%.
Joe was an expert in martial arts and he loved his craft. Following the advice of gurus, he set out to "do what he loved" and opened up a martial art studio. Within 10 months, his studio closed down as he could no longer support his family on his $21,000 year business profit.
Before starting, Joe was destined for failure due to a faulty entrepreneurial premise based on selfish needs: "I'm an expert in martial arts and love the art, therefore I should open a studio".
The correct premises are: Is there a need in my neighborhood for a martial art studio? What are current martial arts studios doing wrong? What are they doing that I could do better? What better services and value could I provide to the martial art student? What do I bring to the table to this community?
Had Joe analyzed and answered these questions first and foremost, his odds of business success would have increased dramatically.
My advice to aspiring business owners is this: Quit looking around for money-making opportunities -- instead, look around outside of yourself, stop being selfish, and help your fellow man solve their problems.
If you can make 1,000,000 people achieve any of the following:
1) Make them feel better
2) Help them solve a problem
3) Educate them
4) Make them look better (health, nutrition, clothing, makeup)
5) Give them security (housing, safety, health)
6) Arise a positive emotion (love, happiness, laughter, self-confidence)
7) Satisfy appetites of all kind, from basic (food) to the risquÃ© (sexual).
8) Make things easier
9) Enhance their dreams and give hope
Do any of the above and I can guarantee you this: You will be worth millions.
So, the next time you hear yourself trolling around for opportunities to make you money, sit back and ask yourself this ...
"What do I have to offer the world?"
Offer the world something of value and the money will be close behind.
Written in 2007, but it's as if it was written yesterday.
Fundamental truths are evergreen.
Don't like ads? Remove them while supporting the forum: Subscribe to Fastlane Insiders.