Entrepreneurship, startups, tech, we all glorify this world and as a result, everyone has an idea they think will be the next big thing. The reality though, is that ideas are borderline worthless. Not only are ideas a dime a dozen, and not only can they not go anywhere without execution, the truth is, if you look at some of the winners in tech, they didn’t even have a unique idea to begin with. What was so unique about Zuckerberg’s idea? Twitter? Instagram? None of these were very good ideas, but they all execute and continued to execute all the way till they achieved market domination.
So if you have an idea for a venture, that is great, but now take that idea and try to transform it into a business. Here are the first 5 steps you need to take:
Competitive Analysis is Absolutely Crucial
I cannot stress this enough. Before taking one step forward, being raising money, before building a product, take a month and study the market. Make a landscape of any and all companies who are targeting the same audience as you, building a similar product to you, or offering the same value proposition as you.
Try to include at least 50 companies in that landscape. This will help you know your market better, it will help you go to market better, and in case that wasn’t enough, it will make an amazing impression on any investor who asks you about your competitive landscape. More competition means there is more demand for what you are trying to do. That is good news.
Build a Prototype, Even on a Basic Level
Coming to an investor with an idea means that investor will either tell you to come back later when there is traction or if they do write a check, it will be on very aggressive terms. Building a basic prototype using platforms like InVision will help you visualize your vision both to you, to your team, and to potential investors and customers.
Find 100 Users and Talk to Them
Amazing investors over the years have written about the need to scale slowly and organically. Everyone dreams of having a billion users, but start with 100. 100 loyal users who will give you honest feedback, positive or negative. You won’t be able to speak to your users when you have hundreds of thousands of them. Aim to hit that 100 milestone and get to know those users.
Map out Your Investors Carefully
As a first time entrepreneur, you might think that you need investor money more than investors need you. You would be wrong. Investors need to return their investors’ money too, so they are constantly looking to find good deals and deploy capital. Find the best investors for you based n their expertise and by interviewing their portfolio companies. Ask the founders what it’s like to work with that investor and if they provide real value beyond the check. Choosing the right investor might be the most important decision you ever make as an entrepreneur.
Hustle, Execute, Iterate, and Scale
If you made it this far, now the fun begins. Build the product, get ready to iterate based on user feedback and behavior, and never get too used to success. You hit a milestone? Great. Pop open the champagne, then start planning the next milestone you want to hit.
Entrepreneurship is hard, it is statistically impossible if you think about it, but anyone who has the bug knows they have no choice but to build products and try to change the world!
Find a mentor or a business partner to go through these steps together.
Nice idea, Pesach. Thank you!