One of the most common questions I hear in conversations with entrepreneurs at Bootstrapper Breakfasts, in Office Hours calls, with clients–and not infrequently from myself when comparing notes with peers–is, “Am I making a fool of myself?” Here are some questions you can use to clarify your situation when you are starting to feel like a fool.
Most opportunities for entrepreneurs that are not franchises, whether they license or simply copy successful business models from other industries or geographies, require some departure from existing or proven business models. Becoming an entrepreneur requires departing from convention whether it’s seeing new uses for established commodities and technologies or finding a first use for new materials or new technologies. If you need a lot of approval and social support don’t become an entrepreneur, it’s a frequently lonely occupation punctuated by the failure of your new ideas and methods.
Learning to Walk
“The child does not begin to fall until she becomes seriously interested in walking, until she actually begins learning. Falling is thus more an indication of learning than a sign of failure.”
Polly Berrien Berends in “Whole Child/Whole Parent“
Inaction trades visible failure for stagnation. One of the keys to prospering as an entrepreneur is to plan for iteration, to chart a course through a series of small survivable failures, where each one contributes to your knowledge. Just as a child is spurred to walk and talk by observing adults, an entrepreneur is inspired by other entrepreneurs’ accomplishments in creating new products and services within the framework of a business that can sustain and enhance them. But just as for a child learning to walk, there are no shortcuts that don’t involve a lot of small falls before she is running with scissors.
I can remember visiting Seattle in August of 1995 when my son was 13 months old. There was a glass top table with a metal frame in our hotel room. Fortunately the corners were rounded (I can remember rough housing in first grade and falling back against the rounded corner of a table. My teacher explained to me after I came back from getting 8 stitches to close a small head wound that if the corner had come to a point it would not have been as mild an injury). He still managed to put a row of bruises across his forehead in a few days by falling against the table from a variety of angles. None were worth more than a minute or two of tears but in my mind the cumulative effect screamed “terrible father” whenever we were in public. I told the story to another friend working at a startup who said they had a similar table in their home, which they had temporarily wrapped in foam pipe insulation after the third head bump.
Entrepreneurs can learn a lot from observing how children develop a new skill.
Entrepreneurship is a Calling
In former times, when enterprises were mainly owned by those who undertook them or by their friends and associates, investment depended on a sufficient supply of individuals of sanguine temperament and constructive impulses who embarked on business as a way of life, not really relying on a precise calculation of prospective profit. The affair was partly a lottery, though with the ultimate result largely governed by whether the abilities and character of the managers were above or below the average. Some would fail and some would succeed. But even after the event no one would know whether the average results in terms of the sums invested had exceeded, equaled or fallen short of the prevailing rate of interest; though, if we exclude the exploitation of natural resources and monopolies, it is probable that the actual average results of investments, even during periods of progress and prosperity, have disappointed the hopes which prompted them. Business men play a mixed game of skill and chance, the average results of which to the players are not known by those who take a hand. If human nature felt no temptation to take a chance, no satisfaction (profit apart) in constructing a factory, a railway, a mine or a farm, there might not be much investment merely as a result of cold calculation.”
John Maynard Keynes in “The General Theory of Employment, Interest and Money“
This is taken from “Chapter 12. The State of Long-Term Expectation” and represents what was for many years the default economic thinking. It’s also horseshit. It assumes you can plan the future in detail and that the only thing that matters is the security of an existing job or an existing business.
By this same reasoning no one should become an artist or a scientist, much less an inventor or entrepreneur. There has been a steady evolution in our understanding of what’s possible–and of the many ways that departures from accepted wisdom don’t work, that’s why it’s accepted wisdom–due to the efforts of inventors and entrepreneurs. Successful entrepreneurs make small bets that have a lopsided payoff: a small affordable loss that is payment for a lesson learned with the occasional breakthrough in understanding that, when combined with other insights, opens up new possibilities.
Fail Conventionally Or Succeed Unconventionally
“It is the long-term investor, he who most promotes the public interest, who will in practice come in for most criticism, wherever investment funds are managed by committees or boards or banks. For it is in the essence of his behavior that he should be eccentric, unconventional and rash in the eyes of average opinion. If he is successful, that will only confirm the general belief in his rashness; and if in the short run he is unsuccessful, which is very likely, he will not receive much mercy. Worldly wisdom teaches that it is better for reputation to fail conventionally than to succeed unconventionally.”
John Maynard Keynes in “The General Theory of Employment, Interest and Money“
As an accurate assessment of human nature it’s hard to disagree. If you want to play a long game you have to be willing to understand and act aspects of commonly accepted wisdom that are obsolete (no longer true) or simply wrong. This is complicated for many startups by the herd mentality of investors, but bootstrappers who are willing to risk only their own time and funds (perhaps supplemented by friends and family) can avoid this.
Here are some useful questions to ask yourself or for you and your team to answer individually and then compare notes collectively.
- What are your strengths?
- How do they help differentiate the product or service you are developing?
- What rare or unique experience do you bring?
- How does this help your team understand the problem or customer needs?
If you are thinking about changing direction: how will this new product or market benefit from your strengths and experience?
- What trends are at work you can take advantage of?
- What recent changes have unlocked new opportunities or placed incumbents at a disadvantage?
If not now: what would need to change to make the situation more congruent with your current approach?
What Have You Learned
- How has your product changed since you started?
- How has your understanding of market requirements or customer needs changed since you started?
- Why hypotheses about the product or the market have you proven false?
- How has your description of the problem changed since you started?
- How has your description of the product changed since you started?
If you are thinking of changing direction: what are the significant unknowns you need to explore to demonstrate this is a better approach than your current one?
What Unique Assets Have You Accumulated?
- If you are really exploring new territory then there is always value in making your own map. If you can find reliable maps, that is one indication it’s not that new territory. The best place to explore is probably two or three steps off the current maps. Not so far off the beaten path that prospects cannot understand your offer, but different enough to provide some unique value for at least a niche.
- What are the facts? What proof to do you have for the need for and the value of your product? What have you directly observed that provides substantiation? Whom have you spoken to that provides support for your hypothesis?
- Have you met people who are interested in seeing your solution to a problem they have? Have you built relationships with potential customers that are strong enough that they are sharing key information about their needs and situation with you?
If you are thinking of changing direction: how will this new approach still leverage or build on what you have accomplished
What’s Not Working That is Making You Feel Foolish?
- Are you feeling stalled because you are trying the same things over and over or because you cannot think of new things to try? If it’s the former try tinkering with your approach. If it’s the latter ask for help from other people who have some perspective on the problem or potential market.
- Are you feeling stupid because you see a clear need but cannot figure out how to solve it? Try and solve a simpler problem that at least some of your target customers have that would be part of a larger solution. Or look farther afield at how other disciplines and industries solve similar problems, maybe you can find something that rhymes.
- After adjusting for the normal variation of the entrepreneurial roller coaster ride, is team morale intact? Whether you want to call is morale or gumption or grit, the shared commitment to collaborating on a solution to a real problem is probably the critical resource for a startup team.
Whether you are assessing your situation or looking for advice on lead generation or closing deals, consider scheduling “office hours” to walk around your MVP, customer interviews to date, current sales process or a particular opportunity you are trying to close.