There is one question that shows up again and again in my Inbox and it reads like this “What’s the most difficult part about starting a business?”.
Here is the truth – starting a business is very easy.
Yep, you heard it right.
See, when you start something new, there is a lot of initial excitement (hopes and dreams) that gives you a big emotional boost which helps to wake up at 5am and work days and nights to get the project off the ground.
Sure, there are things like legal paperwork, office space, wallpaper color, equipment purchases that add a layer of complexity, but those are minor chores that are secondary to the business.
Yet, I’ve seen too many people wasting so much time and money figuring out meaningless operational details (and genuinely enjoying the feeling of “running a business”) only to find out that there is no demand for the product or worse, that the same exact product already exists on the market…
In reality, judging by my own experience of starting many different business ventures, the initial motivation has a tendency to fade away.
The same thing that was super exciting three or six months ago slowly transformed into an annoying headache, especially if you don’t see the immediate results that you were hoping for.
That’s the reason why over 90% of all startups fail within the first few years.
Again, starting a business (or anything new for that matter) is easy, maintaining it for the extended period of time, necessary to get to the other side of the tunnel, is not.
Looking back at my failed business projects I see the same pattern that unifies them all – heavy focus on short-term gain and the lack of compelling mission.
There are only three out of more than a dozen projects that achieved some meaningful levels of success in my life:
- the e-commerce store – when we first started it, I didn’t care about immediate profit (even though it turned out to be the most financially successful one in my arsenal so far). All I wanted was to prove the idea, improve my coding skills and learn how to publish my creation to the internet for the whole world to see.
Guess what, I was literally consumed by the project for at least five years, which was enough to get us to financial sustainability and profitability (still involved in it 12 years later).
- my personal development journey – started over a year ago and still going strong. Helps me to stay in shape physically and mentally and I have no plans to give up any time soon. Sure, it gets tough sometimes, but at this point, the initial motivation and excitement paved the way to a solid habit.
Stay tuned for my morning checklist turned into a short book packed with a ton of useful and actionable info. I know it’s taking too long, but I want to make sure it’s really good and useful before I release it for you guys )
- my blog – for a long time it was just a collection of random technical posts. In July last year, I decided to turn it into something special and unique, a resource that helps other tech people like myself find purpose, motivation, inner peace and of course make more money in the process. I wanted to put together a small tightly knit group of like-minded professionals to share ideas and tackle interesting and challenging problems. I feel like I’m getting closer to this goal every day.
Sure, there are ways to monetize the hell out of every post like some of my readers have suggested, but it’s not something I want to do.
My eyes are set on long-term goals and while I’m not dismissing the thought that one day my blog might turn into some financially successful project (I’m a selfish high-economic dude after all :), plus if people are willing to give you money, then you are doing something right aka solving some problem), I want to make it right to be able to enjoy the ride for the rest of my days.
Please note, that out of three projects mentioned above none had a single focus on the financial gain. Money is the result of what you do, maybe an indicator, but definitely not the only reason for starting something new.
It’s not HOW, but WHY, that’s what you need to be asking yourself when you are thinking about starting a new project. This WHY should be strong enough for you to keep going regardless of the obstacles that will no doubt show up on your path.
Here is one more super important detail – you WHY may sound cool and grand, but it won’t work if deep down you don’t really believe it. You can bullshit other people but not yourself.
When I meet people who want to partner up, the first question I ask is why they do what they do. If money is one and only reason then I simply walk away, especially if the project exists only in their dreams.
Don’t get me wrong, I do love money and everything, but there has to be something else that excites you besides the prospect of getting super rich (if you want to make it the other side of course).
It gets even more important as your business grows. If there is no strong mission/vision in the company you will find a hard time attracting top talent. People that will come on board will show up only to collect a paycheck, there will be nothing that excites and unites them. You will be pulled in lots of different directions in hopes to make a quick buck, spreading the focus and causing even more frustration among your team members and customers.
Remember, in order to grow the business, you will need to stand out from the competition (unless you are targeting a market that doesn’t yet exist and doesn’t have a competition, a very questionable and scary thing in its own). Since you are just another shop on the block, you will inevitably immerse into the fierce and bloody price wars that will eat your margins and halt future growth (the last thing you want to do in the business is to compete on the price, avoid it at all possible costs! hint: differentiate).
I know all of it because I’ve seen it happened to my own businesses. Tell you even more, right now we are going through the “leadership crisis” in our e-commerce business.
When we started it 12 years ago there was one clear idea “Unite local manufacturers, showcase and sell their products online and help them stand up against growing global competition”. For a long time, it served everyone and provided direction. People were ready to take on responsibility and treated the company as their own. It worked.
During the ruble crisis 4 years ago the company fractured in two, one of the founders left to start a competing business. Not only that but, but he left with the significant group of oldtimers and the whole customers base.
We are not going to discuss the ethics of the whole thing. Let me just tell you it wasn’t pretty.
Here is the point though.
As the new people came on board, it became clear that we lost the mission and vision somewhere along the way. Once active and vibrant business slowly turned into boring and soulless enterprise… It still exists, ships products and pays salaries but it has no future unless we address the problem.
In my mind, there are only two states that every business can be in at any point in time – it’s either growing or dying and I feel like we are much closer to the second one.
It’s definitely not the business I want to be involved in, so my partner and I are trying to address the situation. The goal is to bring people together and align everyone with the new mission (or uncover the old one).
The first and most important step is to admit the problem and I’m glad that we did. The second phase is to come up with the solution and I’m hopeful, a bit scared and excited towards the future.
Will keep you posted on the progress, but I hope you got the idea. Focus on WHY instead of HOW and make sure to keep it relevant as you go.