Entrepreneurship

In a word: Action!

The future is always created through action.

What differentiates entrepreneurs from other businesses creators is the level of risk and uncertainty they are willing to take on. Most startups attempt to mitigate risk by reducing that amount of uncertainty in their business model. This usually means a detailed business plan which explores and plans for the risks involved. This approach has been used and accepted for many years.

Its logical. And it demonstrates that some forethought was put into the process of developing the idea into a product or service.

It’s a good start but has one substantial weakness: no business plan survives first contact with its target customers.

What we’ve learned is that a business plan works best for business models that have a high degree of predictability. It by no means guarantees success. What it does provide is a starting point.

Entrepreneurs tend to tread in the outer edges of possibility. Uncertainty and risks are their dance partners. Naturally every business has some degree of risk. What distinguishes entrepreneurial risk from conventional business startups is this: Entrepreneurs have a bias to act in the face of uncertainty.

They recognize that action trumps everything! They know what they are willing to risk and most importantly they know the cost of failure prior to acting.

And the they know this—Risk aversion is a venture killer.

So what does the intelligent and risk savvy entrepreneur do to reduce the cost of failure? Simple: They manage the risks through a series of controlled experiments. They act. They learn. They build. And they course correct in the process of advancing the development of their business model. And most importantly, they cultivate a growth mindset.

So…how does an entrepreneur go about her business in a high risk environment?

1. Begin with an adaptive approach such as Lean Startup or Effectual Thinking.
2. Structure their passion and vision into a testable Value Proposition using Design Thinking and the Value Proposition Canvas.

3. Build a Business Model around this Value Proposition to define how value will be created for the target customer, what form this value will be delivered and how this value will be monetized.

4. Develop testable prototypes using the Build-Measure-Learn Loop to test its value and viability with real potential customers.

5, Follow a systematic process to find Problem-Solution Fit. 

6. Find Product-Market Fit using the Lean Product Process.
There five key factors which determine entrepreneurial success:
o Team
o Timing
o Funding
o Business Model
o Idea

Deficiencies in anyone of these factors will cause increased risk and inefficient use of time and resources.

Guidance through this process of controlled experiments is extraordinarily helpful. I’ve been down this dusty road. I can help you forge ahead.