Signs that a business idea will probably fail
dannorris.me
dannorris.me
Business doesn't have to mean that sort of business. Some guy making $3000 a month selling t-shirts and coffee mugs on etsy has, what I would think of, as a good business. Someone opening up a hotdog stand making $4000 also has a good business.
I noticed this in Zambia, lots of people standing by the side of the road selling soda pop and cigarettes or dried fish, or whatever they could get their hands on. Great businesses, great ideas, I'm glad they're doing it and I commend them for it.
The signs this article talks about are extremely limiting, to the point where the author is saying most people shouldn't bother. I think they apply for starting a big disruptive tech startup. I don't think they apply to an etsy store or hot dog stand, and those are viable and fairly easy to reach businesses. Personally I'd much rather focus on the easily attainable later sort of business rather than focus my time and energy in a quixotic effort to try and be the next Musk or Zuckerberg.
Or maybe VC's actually want to change the world and don't care about profit? I'll just take the money, thanks.
I'm not even sure about that. I saw a paper recently that showed earnings for entrepreneurs is similar to employees. It's only the bottom and top deciles where it varies. The bottom 10% don't earn anything and the top 10% earn significantly more.
In the middle are a lot of people who are broadly happy with their lot and mostly do it because they don't like working for someone else. They seemed to have little aspiration to expand or grow the business.
A small comfortable business with some extra revenue is probably more likely to take some risks ans come up with something new than a large corporation focussed on maximizing revenue growth. The amount of capital the smaller business has available may be less, but what good is capital if you're not willing to innovate and try new things.
In a lot of ways it's kind of like the indie vs AAA games market. Small indie games may not be as visually impressive or make as much money as those epic AAA games, with photorealistic graphics and Oscar award winning cutscenes, but the good ones sre usually pretty innovative and offer quality gameplay a lot of those larger games focused on wide appeal and maximizing profit.
The ideal startup from that point of view, would be 'a better mousetrap'.
But again this process is all new to me. We'll see if anything comes out of it.
Then I started an 'Ideas' board on Trello, and forced myself to put ideas there instead of working on it immediately. I am not allowed to work on an idea unless it's been on the board for atleast two weeks.
This forces me to spend a lot more time thinking past the initial one-line idea, and refining it. Eventually, for about 90% of the ideas, by the end of the two week period, I've come to the conclusion to discard it.
So now, the 10% that I do end up working on, are much more likely to see sustained work being done on them.
How do you prevent the research phase of a new idea from distracting you from your current project?
My problem generally is splitting the weekend time across too many projects, with newer ideas displacing older ones. Having much fewer ideas to work on in total, helps me spend more time on them.
You're just posting it to your future self but it still counts. You can then let it go out of your head and think about something else.
[1] https://medium.com/@bre/the-cult-of-done-manifesto-724ca1c2f...
It feels like you're being presenting Startup ideas from someone else, which allows you to be more objective and critical about their validity... hopefully leading to better judgement
I like the idea though I moved to a pure text (and/or MarkDown) for all of my writings. Bear is not a bad tool if you'd like writing while on the move on your phone.
This has a few benefits for me. The top 3 unstarted ideas help defend the thing I'm working on. If I think of something new, I first have to ask myself if it's better than the top 3. Usually it isn't so it goes in the backlog.
Then if I'm starting to question the thing I'm working on, I can say, "Has something changed such that killing this and switching to one of the top 3 a better use of my time?" Having things to compare it with helps ground my thinkin.
Most of the time I'm working on code, but every so often I step back to set explicit goals and brainstorm possibilities.
Details are kept in a collection of kanban-like spreadsheets so there'a always an overview of what needs to be done at each level.
It's a workable way to minimised ADHD and keep me from getting distracted by new shinies.
Something I constantly remind myself: it's not that you're not capable of doing that thing, it's that you don't have the capacity. You may be perfectly capable of doing something, but if you don't have the capacity to do it, there's a good chance you'll blow it. Disconnecting your ego from reality on this one will save you a ton of heartache and stress.
And for those who say "not me," I, too, was an egomaniac and thought everyone else wasn't as good. Pump your brakes and thank me later.
Owing to other responsibilities I can not allocate X amount of time right now. (Ignoring whole COVID-19 saga of course)
I am capable of make video game A. I am also capable of making video game B.
I do not have the capacity to make both video games in parallel, even if I give myself twice the time. A core level of attention and care is required by each, of which I only have capacity to focus on one at a time.
Hence the person has the capability to count to 1 billion, but not the capacity to do it because other obligations will prevent them taking the required time.
Of course 1 billion seconds is a little over 30 years, so probably the external capacity limit on that task is mortality, dependent on starting point.
What's the playbook for this? Any recommended reading etc would be a huge favor.
PS: Not necessarily a question to OP but anyone passing by.
This will of course mean that the decision makers will need to sort out their politics and divisions to agree an order. This is usually hidden by giving vague and conflicting directions to the rest of the business and hoping it will all sort out.
By solving the politics at the top the organisation will benefit greatly from clarity and resource allocation.
Chances are high that even asking for this will reveal enough problems that you can decide if staying is worth it.
"He who chases two rabbits catches neither." - ConfuciusI did the same thing and failed at everything.
So I decided to simplify: just one thing at a time. And that's the only time I've tasted any success.
The saying has to do with just having an idea is worthless in itself, you have to do something with that idea.
He interprets it as a shitty idea will be successful if executed well.
Wow.
Not that I endorse this. But I think it's a clearer way of saying it. The concern is that people are afraid to test their idea and get feedback to improve upon it because somebody may "steal" it.
> Bullshit.
> Ideas matter a lot, and if yours is a shitty one, for you, at that time, with the resources you have, it will almost certainly fail.
I think your interpretation of the author's interpretation is flawed.
The saying is more along the lines of "An idea without action is worthless"
His rephrasing of it was either a 1) bad interpretation or 2) a purposeful one so he could disagree with it and appear 'edgy'.
> 7. You are operating mainly on assumptions
You'll always be operating mainly on assumptions. Everyone will.
It does help to check your assumptions against external things, so if you're wrong, you can notice faster. But even the process of noticing that the data is confusing is like 99.99% rationalism and only 0.01% empiricism.
I was completely wrong. I didn't know my clients and my market. This is the exact definition of operating mainly on assumptions. I lost at least 18 months, since I could have find this out way sooner.
Then I found ont the real truth:
- Merchants won't find your website to buy your amazing product, you need to meet them physically (that can seems obvious but it was not the case for me at that time)
- Merchants don't care about you or your product. They won't listen to you in deep, except if you have specific social skills (I don't). Every day someone enters in their shop trying to sell them something. If you're not psychologically ready to hear "I don't care" or "is it free?" 9 times on 10, then you can not do that for a very long time.
- Independant merchants, generally speaking, don't have any marketing skills. What seems obvious for you is not for them. For example, they don't see the powerfulness of getting emails and consuming habits of their own customers. Plus, I'd say 2/3 of them were really suspicious about technology in general.
So what was hard here was not to make a product that have intrinsic value for merchants, but to teach merchants what this value is.
The real need to succeed in this project is absolutely not tech, it's to know the market, and how to convince merchants.
Did you try to look for a sales partner?
What are you working on now?
Hopefully you are back on your feet again. We must learn from our failures and move on.
That said, all of this would be as expected, even for a great product, with product-market fit.
Selling is hard, you have to find the right niche of customers, references, and not everyone will love it right away.
Great lesson that you will take with you on the next run.
Selling is hard, and becomes close to impossible if like me, you don't know your target, and on top of that, you're socially anxious to talk to strangers and get a "no" as answer.
Client prospection requires specific skills I don't have and I'll probably never get.
Sometimes we (solo-dev people) need to be more humble and accept we can not do everything well. Or as an alternative, we need to find project ideas that suit our skills better (B2C would probably have been easier for me than B2B).
I'm sorry to hear you were not successful, that REALLY sucks to spend all that time and not feel good about it.
It sounds like maybe you waited too long to attempt to sell anything? That's what MVPs are for, to give you feedback to see which of your early assumptions were correct. Ditch the incorrect ones, focus on the correct ones and get better at making assumptions and grow your business organically, based on a positive feedback loop.
The first rule of "some level of self awareness" is to not completely hand yourself over to survivorship bias. So the argument is that Mark is a smart hacker and possesses "balls of steel" -> Mark is successful? And because you're the opposite way -> you'll fail?
No. He's been completely blindsided by survivorship bias. It's actually the other way, from that Mark became very successful (via good luck which was probably modulated by some highly attainable level of skill in execution) -> everyone thinks Mark is a super hacker with balls of steel.
It's terrible advice which gives you premonitions about yourself which would keep you from even trying. Or maybe the author can actually tell innate potential to some uncanny degree, in which case he should join YC to vet founders.
“ideas don’t matter, only execution matters”.
Bullshit.
Ideas matter a lot, and if yours is a shitty one, for you, at that time, with the resources you have, it will almost certainly fail."
But most, if not all of his red flags are execution-centeic.
I'd like to add, it's not that ideas don't matter. They do. However, most of the time a good idea executed well will beat a great idea done poorly. Furthermore, very few ideas are born great. They usually reguire refinement. That refinement process is...execution.
It makes sense if you think about it. If we knew in advance what ideas will work anyone could have a successful product which isn't the case.
A well-played execution process has iteration and refinement baked into it. Few ideas are born fully grown. They evolve; provided they are allowed to do so. That evolution is part of execution.
Does your business model leverage network effects? Did you get funding from the right investors? Does your business model reward customers for helping you recruit other customers? If so, then your odds are very good regardless of what you do.
If you don't have a network growth strategy, then nobody will know about your startup. You can have the best idea in the history of the universe, it's not going to work because no one has an incentive to use and recommend your product or service but they have an incentive to maintain the status quo.
Investors and users need to stand to gain more from your project than from upholding the status quo. And these days many investors are shareholders or employees of the status quo so this is a difficult thing to pull off.
Many articles focus on the idea of building your community etc, but few actually focus on how to do it amidst all the noise
What causes has Bezos given to? He shouldn’t even be mentioned in the same sentence as Gates.
https://www.scmp.com/magazines/style/news-trends/article/307...
This is ridiculously bad advice. How can you expect to make a dent in the universe if you can't even manage to believe in yourself?
They're mostly developing on the importance of being smart, all the while misunderstanding what being smart is (it's not grades jesus christ) and failing to establish a correlation between smarts and fitness for a particular task.
But the "you're not good enough" justification seems misguided.
That point almost seems like most of the points tied together.
This is so true it’s almost a cliché. Too often have I been in organizations that try to do a little of everything I hoped to eventually find something that sticks and it has almost never worked out.