Entrepreneurial false-positives

At the beginning of a new business venture, being a founder with lots of willpower, skills, energy, and drive can actually hurt you.

Grit, determination, and hustle are important, but they can lead to false positives.

It's quite common for high-performance entrepreneurs to build a business that's just "sort of working:" through pure willpower (or sometimes an existing audience) they're able to get initial customers and revenue.

This initial traction can feel like validation; but often, it's not there. The business is running on fumes; there's no underlying demand fuelling it.

Grit and determination are positive characteristics. Having an audience or personal brand can also be an advantage. But there's a real danger in building a business that is completely reliant on the founder's relentless drive.

What to look for in a new business opportunity

When you're working on a new product idea, look for evidence of organic demand.

You shouldn't have to "pull too hard" to attract customers; the market should be doing most of the work for you.

Getting a new customer shouldn’t feel like a “heavy lift;” it should feel relatively simple and effortless.

Why? If you’re working really hard to convince someone to become a customer, they’re not self-motivated.

You want self-motivated customers!

Pay special attention to existing momentum: are people already in motion? What does customer velocity look like currently in that market?

Years ago, I started a snowboard shop in my small suburb, thinking that the thousands of snowboarders in my area would want to "shop local"

But what I didn't consider was their existing momentum: they were happy to drive into the big city and shop at stores with more inventory.

I discussed a lot of this with Iron Mike Steadman on his podcast:

"When everything falls into place, and you're not relying solely on your own effort to make something happen, but you're able to ride the market, a business can be incredibly life-giving."

(You can listen to the full episode here)

Cheers,
Justin Jackson
@mijustin

Published on April 29th, 2022
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