His new article for Business Advice sees Small Business Charter chairman and ByBox CEO Stuart Miller delve into some of tough choices and frequent dilemmas entrepreneurs face.
Entrepreneurs face countless conundrums on the journey to building a worthwhile enterprise. Decisions that have such weight of argument on both sides that they torture you through sleepless nights.
Should you raise funds early, or bootstrap as long as your nerves can take it? Should you recruit upfront to prepare for growth or conserve cash instead? But one conundrum sticks out above all others. It is the mother of all dilemmas and you will face it again and again on your wonderfully precarious journey.
Should I pivot or persist?
Rule number one: real entrepreneurs never give up. Never, ever ever. That Churchillian refusal to down tools is at the very core of our DNA.
Of course, there are always a thousand seemingly good reasons to stop: running out of cash, being sued by a big company, your mum screaming at you every Sunday evening to get a proper job.
And you can always add to the list by convincing yourself of the same. The market isnt ready yet for my brain child. Like all other geniuses, I am just way ahead of my time. If only I could raise 10m then Id grow a brilliant business. The collapse of the financial markets wasnt my fault. And so on. Yep there are always plenty of reasons to stop. But don’t kid yourself if you choose to give up, you have failed. And despite the current penchant for failure, that is not what real entrepreneurs do.
But the annuls of successful entrepreneurship are littered with glowing case studies of smart entrepreneurs who tweaked an idea before the money ran out. To use investor jargon they pivoted.
Investors back people, not ideas
it’s funny how often you hear wantrepreneurs claim to be on the brink of launching their sector-crushing venture all they are waiting for is the right idea. Of course, these people never end up on the starting blocks of startups because it is not about the idea it is about the team. The old adage is true: investors back teams not ideas. A second rate team with a first rate idea will simply mess it up. But a great team with a poor idea will change the idea until it works.
This is all well and good, but if you’re in the eye of the entrepreneurial storm how do you know whether to persist or pivot? How do you know whether you are about to make the major breakthrough and power on to real success, or whether you need a change of course to avoid destruction?
First of all, take a morning off and go somewhere like a park or a gallery or a garden. Somewhere out of your ordinary grind. Spend a couple of hours reflecting on the core principles of your business. Have you proved, unequivocally, that your idea is flawed? You absolutely must drop your ego and answer this honestly; there is simply too much at stake to do otherwise. Be brutally rational and drop all emotion. Have you demonstrated, empirically and for certain, that the fundamental economic model upon which your business is based is actually wrong? If not, then work out how to prove your idea is wrong and get cracking.
Up until now, you will have put all of your tremendous energy into proving that you are right, so trying to do the opposite will feel strange at first. But it can be a very effective catalyst to either unblock success or prove, once and for all, that the horse you are flogging is dead.
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