10 myths stopping you from starting your own business
Entrepreneurs tend to believe that the all the stars in the sky need to be aligned perfectly for their start-ups to succeed. Because of this belief, they postpone their jump to entrepreneurship, often indefinitely. As a strategy consultant advising companies big and small on the best ways to innovate, I believe we need to rid ourselves of the many myths surrounding the creation of new businesses; all one needs to launch a million-dollar idea is the right framework, the right state of mind, and a LOT of work.
I’ve compiled my biggest pet-peeves below. Feel free to add to them in the comments.
1. The First-one-there myth
Far too many entrepreneurs believe that commercial success comes from ideas no one has ever had before. This is wrong, and numerous examples prove it : Instagram and Twitter copying Snapchat “Stories”, Sega creating Sonic the Hedgehog to take on Nintendo’s Mario, Google Home copying the Amazon Echo…
In an exponentially connected world, it is nearly impossible to find a truly original idea to create a business. Not only are new actors from all over the world rising to meet changing customer demands, but existing companies are continuing to grow vertically and horizontally, creating competitive kill-zones within which only the truly mad would launch a business.
In such a world, it’s best to look at ideas that exist in other industries and implement them in one’s own. This, too, is innovation. Just not the one entrepreneurs tend to brag about.
2. The Go-big-or-go-home myth
A start-up does not need to be something entrepreneurs throw themselves body and soul into, tying their fate to that of their company. That’s called putting all your eggs in the same basket, and it’s rarely the smart thing to do.
Remember : entrepreneurship isn’t unicorn or bust. There is nothing stopping someone wishing to start their company from starting small as a part-time gig, and scaling up when (and if) things start to take off. In the meantime… nothing wrong with a comfy office job, Silicon Valley be damned.
Examples of companies started as side gigs abound. Two of my favourite examples are Impressa Solutions, which started life as a freelancing gig, and Miss Design Berry, which was once an Etsy boutique.
3. The High-tech myth
The world is increasingly digital and technological, no doubt about this. Yet, it’s important to note that while the media is focused on tech companies, other industries are making money hand-over fist.
Not every innovation is technology-based. You don’t necessarily need an app, AI, an IoT product or a crypto-currency to be successful. Look at Blissim (ex-Birchbox), for example : no new fancy technology, just boxes of beauty products being curated and delivered monthly, amounting to $150M in revenues.
It is not only entrepreneurs who buy into this myth : too often, executives and managers latch onto the idea of innovation as a new technology or product. This is far from the truth, as these two things represent only one side of the innovation triangle. Profit mechanism and value chain are the two other side of this triangle, with the customers at the centre.
4. The Luck-of-the-Irish myth
People tend to believe that having a successful company is about being in the right place at the right time. And that’s partly true for the behemoths of this world, which emerged as new customer habits were being formed. They are in the minority, yet continue to inform our definition of success. Survivorship bias is a b*tch.
Real entrepreneurship stories are about grit and risk and determination. They are about people who sacrificed for years and through hard work created something that could sustain them, their families and, just as importantly, their employees.
I have never heard of a successful sports team that won a game by relying solely on Hail Mary plays. Victory on the field is more often than not the result of blood, sweat, tears and a cloud of dust. The same applies to entrepreneurship. It’s not about being on stage at a TED talk or bragging on LinkedIn about yet another leadership lesson. It’s about continuously cold calling. It’s about continuously shipping code. It’s about putting out fires EVERYWHERE, ALL THE TIME. It’s about waking up at 4:15 am to catch a flight to a small town’s industrial zone for a $200k deal to hit your budget for the quarter, and maybe, just maybe, remain profitable. Sure, it’s not sexy. There’s nothing inherently sexy about hard work. But it’s real. And it’s stable. And it won’t leave you pants-less when the bubble crashes.
5. The Genius myth
We like to believe that only creative geniuses can come up with truly innovative ideas. Elon Musk, Bill Gates, Mark Zuckerberg (to a lesser extant)…But plenty of great ideas have come from very average people, who also tend to be better manager (empathy, ever heard of it?).
The example of Alex Tewn is one I often use during workshops. As a 21-year-old college kid, Alex created The Million Dollar Homepage. The idea is not particularly complex : he sold 1 million pixels for $1 a piece to advertisers. Not a genius idea by any standard, but he DID make a million dollars.
As I’ve mentioned above. Ideas don’t matter as much as discipline, frameworks and hard work. Unless you’re creating the new million-dollar page, but I think that ship has sailed.
6. The Maverick myth
This myth is often interconnected to the “genius myth” above. Entrepreneurship bros like to revere figures who go against the grain, revolutionaries within their industry. They like to think that unless someone is truly eccentric, then maybe they don’t have what it takes to create a truly innovative company.
Steve Jobs is obviously the main example of such a legend. Marc Cuban and Richard Branson are two other famous examples.
What people fail to grasp is that these people often developed their maverick personalities AFTER they become successful, with the help of very well-paid PR departments (It’s called branding, Alan). Pretending to be a maverick when your company hasn’t made a million in sales yet usually draws the ire of the industry, nothing more.
7. The Billion-dollar myth
Big breakthrough don’t always require big resources, and rarely truly need VCs to come into existence. Yes, having a VC back up an idea can be incredibly helpful, but plenty of successful companies started with no funding at all.
Examples of these “invisible unicorns” include MailChimp and Shopify, which grew from virtually nothing with very little external support. There are countless other examples of small companies that were started by entrepreneurs wanting to get by on their own, and who did not want to scale. They never wanted a billion dollar, and are happy without it. Money is not always the end goal.
This is a recurring theme in this article, and with entrepreneurship in general : there is nothing wrong with starting small and growing at your own pace. Tell the vultures to go back to micro-dosing.
8. The Hype myth
Fortune favours the boring. Whenever an innovation is the center of a lot of hype, that space becomes substantially harder to break into. Boring start-ups, however, can make a LOT of money before anyone really catches on.
Protolabs and its boring injection moulding is worth $5B, CVent and its boring management tools made $640M in 2019, Qualtrics makes $100M a year by doing boring surveys for schools and businesses… The list of examples go on and on. And because there was no hype, these 3 companies got to where they are today without the help of Venture Capitalists.
Remember that when Brad, Chad and Thad are trying to sell you the idea of starting yet another crypto-currency.
9. The Top-down myth
This myth is is typically alive and well within large companies trying to internally kickstart innovation by forcing their employees to be entrepreneurial. This can take many forms : hackathon, competitions, idea boxes… It generally leads to very little success, to Management’s bafflement.
Scaling innovation in a top-down fashion is incredibly difficult, if not impossible. As far as I know, only one company has ever managed to do it : Disney.
The safest bet for companies trying to create start-ups is for them to simply make an incubator available to employees with entrepreneurial ambitions, and let nature run its course.
10. The separation myth
As mentioned above, entrepreneurship is not the sole propriety of lone entrepreneurs : established corporations also seek out entrepreneurial endeavours nowadays (and often suffer from misplaced beliefs just the same).
Too often, these companies think that keeping a new business far from the core is best. They create Innovation Labs, Open innovation offices, underground research bunkers… anything to keep one business from infecting the other.
This is however not the way to go. If the difference between the established business and the innovation is minor, and there is a high strategic relatedness between the two, integration is best. This also applies to lone entrepreneurs : just because your start-up is not the same as your day job doesn’t mean you can’t try to mix both : the results could be surprisingly pleasant.
Being an entrepreneur is not for everyone. Not because it requires any specific talents, or education, or background (though a rich family helps), but because it’s OK not to wish to create a company. It’s stressful, and uncomfortable, and rarely worth it. But those eager to dive in should do it as soon as possible, without any bias.
The water might be cold, but only movement will prevent hypothermia.