This article is part of a series about going from “I’d like to start a business” to having a small start-up running, and beyond. If you haven’t read the previous articles, I recommend you do so by going to the first one, which includes a small table of contents.
So you want to start a business… but you’re still not fully convinced. Lack of determination is the first barrier to overcome. I’d like to convince you about two things: to go for it, and that taking that decision right now is probably way more convenient than doing so in, say, five years.
Starting today an adventure like the one we are proposing is clearly cheaper than starting it later. Why? I am asuming that if you’re reading this blog, odds are you are in college. If that’s your case, then your oportunity cost of doing a startup while still there is your GPA sinking 5%. Perhaps, not earning an intern’s salary. I doubt you’re concious about how that cost grows in the very moment you finish your degree and start working full-time (Hint: a lot!). And I don’t even want to think about all the free time you can manage to have now vs. the amount you will have in the future.
The cost of failure grows as time goes by as well. Failing when you are still at college has no major consecuences: you might lose some of your savings, you will for sure be frustrated, but your life won’t change that much. Your main activity will still be attending university, outside observers will see your failure as just a little project that didn’t work out and the lessons you will take away from it will probably be richer than those you learned in many courses. Hitting a wall a few years after graduation is more expensive, but generally still afordable. Failing big time when you’re 35 or more and you have a family to support is a different story. By no means am I saying there comes a point in life when people should stop taking risks, but every year that passes makes it more expensive to take them.
Don’t let this message fool you: passion does not pay for the bills. But if you’re not passionate about it, you will give up by the first wall you hit (and trust me, you will hit many). Think about it this way: if you know that once you start with it, you will spend half of your days working untill 2am… would you pick something for what you feel little more than indifference? I don’t think so.
I really like the way Vinod Khosla, Co-Founder of Sun Microsystems and VC, talks about this matter in the following video:
Ideas, Ideas, Ideas
Now that you are (hopefully) convinced about doing it, lets jump on the next obstacle you will face while on the entrepreneurial path: how to generate ideas and spot opportunities.
There are lots of ways, but I believe that two of them are enough:
- Try to think about what frustrates you or areas where you see clear opportunities for disruption. It’s full of them: you just keep stumbling upon products or services that you know could be a thousand times better, or needs that are left completely unsatisfied. Keep your eyes wide open; being aware of what happens around you is key to spotting new business opportunities.
- In Latin America we have a little advantage: we can see the future. No, I am not crazy. Lots of innovations reach these latitudes with some years of delay, specially internet business that require some kind of local presense. This gives us local entrepreneurs a 2-3 year window (sometimes longer, sometimes shorter) to clone here business ideas that have already proved succesful abroad (Beware, this strategy almost always requires adapting in some way the original model). What we did with Cena Plus is an example of this. Other examples are NetShoes following the steps of Zappos, TiendaNube those of Shopify or PedidosYa those of GrubHub. The same logic goes for Europe, although the window is usually shorter. You might want to ask the Samwer brothers about that.
If you let me go back to my previous point, I don’t think you should be afraid of copying ideas, or feeling a thieve for doing so: ideas are not owned by anybody. As the saying goes: Ideas are a dime a dozen, execution is what counts. Getting out there and making things happen. If having the idea was enough, the world would be full of millionaires! I found really interesting what Groupon’s CEO said when asked about the “problem” of giving the Samwer brothers so much control over Groupon’s international expansion:
The Samwer brothers have a reputation for cloning, and before I started a company myself, maybe I would have looked down on it, too. You need to realize that execution is the hard part, the idea is easy.
The Samwers are the best operators I’ve ever seen in my life. We’re super lucky to have them. We couldn’t have done it without their help.
At the beginning of this post I told you that lack of determination was the first barrier to overcome. Later, that finding ideas and opportunities was the second one. The third one is going from an idea and mental models in your head to interacting with the real world. That interaction can be the first call to suppliers asking for quotes, running your first AdWords campaing, talking with your first potential customer, and so on. So once we know which idea we want to start with, it’s time to stop making excuses and just do it. This is what the next articles will be about.
While we wait for the next post, I’d love to ask you:
- What are your biggest motivations for starting a business?
- And the main fears/reasons stopping you from doing it today?
- Is there any other idea generation / opportunity spotting techniques you would like to share with me and the rest of the readers?
- What do you think is the most fundamental step to take once you find an idea you want to develop?