There are many sources (books, websites, courses, mentors etc.) that will provide advice on how to start a business. Congratulations, you just found another.
Many of those sources will tell you that you need a vision, commitment, energy, enthusiasm, and so will this source. But as useful as this advice is, they may as well tell you that you also need a pulse.
Most sources will also tell you that you need a Business Plan. Again, great advice as you’ll learn about important aspects of your embryonic business such as Business Structure, Strategy, your Market, the Skills, People, and Systems needed, Finance, and much more. But in most cases, starting with a business plan is like ‘putting the cart before the horse.’ Don’t get me wrong, business plans are (or at least can be) useful and therefore valuable documents. The problem is however, since the concept of business plans is derived from big business, the unspoken assumption with business plans is that you have existing customers and you know your market. With a start-up, you know little about either.
The path taken with this source is that, apart from a few cases, such as needing start-up funding to create a prototype minimum viable product, to demonstrate the concept or product to prospective customers, creating a business plan is probably not where you should start. (On the topic of business plans, especially when trying to raise finance, ask the prospective financier(s) what they need to see. There’s little point in creating a phonebook-sized business plan if all your prospective financiers want to see is a single page Cashflow Statement.) Once you have proven that people will buy your product, service, and experiences, then sure, create a business plan to raise finance and sort out the high-level management details etc. Just don’t rush to create one as your first task.
So, where do you start then?
The least risk and least cost place to start is with your prospective customers. Peter Drucker said, “the purpose of business is to create a Customer,” and you create a customer by providing people with what they need and want to buy from you. To find out what they need, you look to see what jobs they are trying to get done (job to be done), the problems they are trying to solve, and the experiences they are seeking.
In the book The Four Steps to the Epiphany, Steve Blank said that “build it and they will buy is not a strategy, it is a prayer,” “you cannot create a market or customer demand where there isn’t customer interest.” I will likely repeat this quote many times. It’s worth repeating.
Many prospective entrepreneurs seem reluctant to conduct the research, to find out what jobs people are trying to get done. Instead, they will effectively take the big leap and ‘build it’ by starting their restaurant, tourism venture, brewery, therapy clinic, lawnmowing service, cleaning service etc. Taking this approach can be a huge financial risk. Business is inherently risky; to leap in before you check is likely to end in tears.
So what are the unspoken assumptions that leap before you check entrepreneurs are making that they hold as true? Have they verified any of them? If any of their assumptions aren’t well-founded, what risk do they pose to the venture?
This source is all about taking the least risk approach to rapid learning and implementation while checking and not assuming. This source uses the principles of the scientific method and shuns the wild-assed guess approach like the plague.