Updated: Jun 30, 2020
The purpose of this post is to help clear fantasy and smogs and make the startup process clear to beginners.
Startup is like learning to drive, buy a car, learn not to crash, get a local job, and one day got an urge and drive your car for 12000 miles with a partner to deliver a hand written mail to a stranger in a foreign country and not knowing if you will be paid for at least postage. This is what most people's first start up feels like. And you have to ask investor for gasoline money for the trip. There are all sorts of books, all sorts of accelerators, but you still don't get it, until you are half way through that trip. This post is to make it super super clear for a beginner what startup is and what startup is not.
People complain about the utter lack of clarity about the startup process, with many things written for the entrepreneurs but not beginners. Many people want to try even if they KNOW they are ill-prepared. Here is a step by step list to reach clarity.
A lot of startup and entrepreneurship from schools or scholars are forced. Real business opportunities are everywhere, even big ones. But failure is a prerequisite for clarity, so you can tell crazy from crazy smart.
This post is for the following readers: people who have not hold a job in an industry or spend a day in a real competitive industry, say farm, factory, store. Suitable readers include teens university students, professors, most corporate engineers, professional such as doctors and lawyers. This article is meant to clarify things once and for all.
Is startup easy? Yes! Especially for people doing it second time.
Is startup hard? yes, if you think it is easy, it is hard.
Startup is start a business. Most business don't help people and founders, they just become a fabric of society eventually. Starting one would teach you how the world really works, as an owner. But your chance of "success" for the first time is virtually non-existent.
To have or start a business, know the audience, know the market, and solve problems in the market. If you guess a problem cleverly and then go to market to seek acceptance, you will lose 9 out of 10 times, or end up with a bad business.
There are two realms - the business realm and academic realm. When academic people talk about business, a lot of forced ideas happen.
"Business is basically be smart, hardworking to a fault, have capitol, having good help, and be ready for any contingency. Then play the lottery and win two jackpots on your first two tries. But running a business taught me so much about how the world works. I’d happily do it again just for the experience and knowledge."
To really understand everything about how the world works, startup. The clarity and satisfaction beats being a professor or a CEO.
At universities we teach students to be smart to a fault, and many people are ill prepared, especially for IPO or VC investing level of ideas. We don't teach building skills and don't put students down from the pedestal to work. That is why many are confused.
At schools we teach students how to think logically, and many people try to out smart something easy and big - it never exist.
Starting up a business is natural. It is human nature to connect. If you do it naturally, it has a good chance, just like a plant coming out of ground easy. But if you force it, say by making something and solve some strange problems (e.g., Lean startup), the chance sounds high but is actually low.
We also teach a lot of people to start with no capital, no skill and no target audience in mind. In fact, this school of teaching is quite popular, especially among people with no capital, no skills, and no directions.
We teach people to imagine and be inventive, without ever going to market to meet real people and problems. It is empty thinking and wishful thinking, but no one tells that the emperor has no cloth, or the teaching just don't know what they are talking about (sorry teachers).
The plain truth is that teachers at schools don't even know anything about startup and business, and yet they are the one pushing their students to just do it.
The plain truth is that most of our ideas are not unique and the world is completely OK if none of our ideas are realized. The world is fine - it is not perfect but it works, miraculously. To startup, you must pick a disruptive game changer, otherwise it is a hobby and a job replacement.
Startup is not mysterious. Marriage is mysterious to unmarried people. But the married people and unmarried ones perfectly live together in the same town. Some married man write books about "lean marriage", "from date to wife", "from boy to man" and the unmarried population still don't know anything about the married world, even though it is virtually overlapped physically.
The source of the confusion is schools do not prepare people with skills and framework and then tell them something easy "might work". They don't know the subject and they don't have building skills, but they want to do business for themselves. There is no feedback because people succeeded or failed would not come back to tell the story.
People are confused when they hear too many people teaching, but they forget to listen to themselves.
Popular books are everywhere. Books like "the hard thing about hard things", suggest it is hard. Books like "the obstacle is the way" is counter intuitive. Books like "Lean startup" and "from Zero to One" gives you hope that someone with minimal experience and capital could do it. Which version should I become? who should I trust?
Startup is human relation - providing value, get paid, get relation, get love. Find meaning of life by knowing who you are and who values you. That's it. No more, no less.
Startup is about creation.
Caution: you create things OTHERS accept, not what you would love to offer. To create, you must first know what people want, and cater to them. They don't cater to you. So the first and most important step of creation is to know what people will want and will pay. Even Thomas Edison invented light bulb after knowing this will replace gas light and be a house hold smash hit. "Never invent something no one asks for".
Some people do extensive customer survey and still fail, most startups do fantastic products and have good customers interviews and investor support and fail miserably. While people like Steve Jobs seems to not do customer survey at all. This does not make it OK to create what the entrepreneur wants to create. Steve Jobs knows what people want without asking, where average people don't even know what THEY want themselves. Most inventors and entrepreneurs don't have that degree of clarity and business Zen.
POINT BLANK STRAIGHT
The other day I saw a Reddit exchange of Small Business Entrepreneurs COMPLAINING about "startup culture" entrepreneurs. It is illuminating. I copy one exchange below, between me and another redditer.
Who would be in favor of a sticky where people can discuss their utter lack of clarity in starting a business but have no clever idea of what they want to do?
I don't know about you, but I tire of the endless posts that are well meaninging but completely hopeless. People that are in love with the idea of working for themselves but have no concept as to what they would sell or service they would provide. I would even consider writing some sort of a noob guide. Maybe, just maybe one or two of these people can find their niche while approaching it this way, but I find that most people get into business because they already know their subject and I don't see these posts as being a very productive part of this sub. (Reddit link)
Dear u/RussianVoteEngineer on Reddit, Here is the clarity and cheerful reality you want.
I see your post touched some nerves. Both small business owners and students-entrepreneurs.
I am a veteran with the so called "scar" and paid "tuition". If you ask me to start again, I would be very torn. 51% of me would say go, because i become a much better person. 49% say no, because it is really really not worth it.
If one does become good with starting up and with business, it is quite amazing and fun. But to get there takes a tremendous leap, daily weird struggle for 3 years. It is the biggest reward in life to have an organization of your own, to have clarity about what you do. But you need to pay dearly for that insight.
Startup is not for yourself. It is for other people. It is very intense, very unpredictable. It is not revolution, not problem solving, not product making. It is about creation of a financial node with benefits, and creation is hard.
Business is working for yourself. As opposed to being an gamely employed salaried worker. Your company was a startup and it has the network and business - but you as an individual must start from completely scratch - most people no matter how highly educated don't stand a chance. You can be a star professor at MIT and you can not open a tutoring outfit in your town. You can be a tremendous amateur baker but you can not open a money making bakery in a town.
Starting ANY business takes tremendous preparation and planning. Most clever people are under prepared and click too late. Most people don't get rich - even for those who does it is hard to get complete peace. Money flows from one end to another. Most business people started are tough, lean and not interesting. Just like pictures that most people paint or draw.
All people are clever and hard working. That is not enough. Startup success comes from choice, and choice only comes clarity, and clarity only from failure. It does not matter HOW SMALL the business is - from a lemonade stand to google, the competition is fierce on ALL levels. The lack of success is not for lack of efforts - it is because people don't want you to succeed - they (the ecosystem and customer) must know you first. Startup takes time, because trust building takes time. Startup only takes money, because you must offer worthy proposals to people who utterly don't care.
Startup is Albert Einstein learning the works of New York street gangs by joining it. The minute you realize "any idea I have, people have thought about it", you graduated from "startup school". It is never about hope and guess, about cleverness and certificates you got. It is only execution, only trial and error, only none-stop learning, only experience one high-low cycle everyday for 5-10 years.
Ultimately, the only reason people fail at startup is RUNNING OUT OF MONEY. So never do startup for money. If you successfully buys three homes and have a profitable factory, you put all your houses as collateral to borrow money from a bank so they provide you money to make money. When your company becomes big, you then work for your star employee and middle managers, who controls your lifeline. So never do startup for freedom.
Startup is about relation building - with customers, downstream, upstream. Relation just takes focus, takes money, and takes time. That's all.
Business is how people bring home the bacon - you never introduce a new thing into vacuum. A vacuum is a desert. Everywhere there is no competition, there is no customer.
It IS very rewarding for personal learning ... it is the ultimately learning. Do it when you are young and have nothing to lose, as an education and elevation.
Most people who successfully startup have unbearable advantages such as family background and timing. Microsoft and Apple were born on the eve of micro computer, and Amazon on the day internet broswer is born. Timing is 44% of the idea. Recognizing timing beats clever creative thoughts. Many success instances are done by force, such as restaurant chains Panda Express and Noodles.
Voluntary startup of modern days rarely succeed. 1/10 startups find buyer. 1/10 of that have steady business, and 1/10 of THAT makes profit. Don't believe anything the VCs and IPO fantasy. VCs, wall streets and incubators together put up a tremendous THEATER of startup ... it is not real. Real startups never gets VCs interest, never goes public, and never benefits from incubators.
What are you talking about? Why are you giving the impression every small business has to do many if any of those steps to be successful or turn a profit.
What a terrible reply holy shit.
I know plenty of people who liked to do something and found a way to offer it or something related to it to the public in one form or another in exchange for money.
That's what a business is. Is doesn't need to be more complicated than that.
If you choose to scale that business and begin hiring employees expanding territory/locations or however it works within your industry that's great but this is such an extra reply it's cringey.
Starting a business is extremely easy and you don't have to be educated etc you just have to be hard working and confident enough to take substantial person risk. Money can solve almost all the other problems. You give me the impression you don't know what you are talking about.
Most people fail in starting a business because they read shitty advice like this and don't start a business, it's a confidence problem more often than not.
I hate to tell you but the vast majority of businesses that succeed and make a substantial profit are not highly oiled corporate machines, they are a guy who started a painting business because he likes painting and wanted to work for himself and now he has 4 crews who paint year round. He's not the most organized and his crews can be subpar but he stays in business because there is a need and he can reliably SOLVE THE PROBLEM YOU HAVE IN EXCHANGE FOR MONEY. Mostly because he has experience and has taken the time to figure out all the little details and put them into practice.
This is a small business sub, not a startup culture sub.
This sub is for the guy who owns a business emptying greasetraps so the restaurants that hire him can stay health code compliant, not for the guy who wants to invent a revolutionary product where he has to educate the customer base and create a market and needs 500k in funding and then 300k 6 months later hoping that in time the scale will make the business profitable and he will be rich overnight in that climax of leverage that everyone glorifies.
Startups like this are just very high risk very high reward and very glorified, in the same way making it big in entertainment is glorified. There is nothing wrong with that, but that's not what this sub is about.
If you have the free time to hang out with your friends on the weekends, you have the free time to start a small business.
When the business makes you enough money to where you can live off of it and also still continue to invest back into the business and grow it then you quit your day job and work full time in your business.
And my response to him:
you are right, startup is not hard at all. It is actually fun and interesting and desirable. I said it in my second paragraph. There are different flavors of "startup". different cultures coming together and saying the same word but meaning different things. A small startup is golden, and really don't need to natural. In the "tech world" there is another flavor of "startup", you recognized that, and that was my subject. Many "highly educated people" get confused, and I am sure that is why the OP is confused about the confusion there is. Just trying to help the OP and people, mate.
Is startup easy? is it hard?
If I am highly educated and smart, would it be easier?
How long would it take? is the view at the end worth it?
How do I prepare for it?
Is it for money? is it for introducing new things?
There are at least four classes of people using the same term "entrepreneur":
the people who start business naturally when they are young, as a way of supporting themselves.
the young students in school, immersed in "startup classes". They learn swim on the dry dock.
the highly educated "elites" who wants to invent and startup, they do "advanced invention" hoping it would be useful.
the rare people who received tech education and still succeeded in launching big business, and is often attracted most attention in media. They mostly captured the time elements.
There are two camps, the "startup theater" cultured people and the "startup naturally" business people.
Natural startups are the "earthy" ones on the ground - you see a chance, you see a need, and you respond. You don't need to read a book to start. It is natural. It is response to survival and growth.
Natural startups and Small businesses live in HUGE industry and takes a small slice. But the small slice is enough to make someone "rich".
Scholars believe that everything there is in the world is documented in books. They are nerdy in a good way and a bad way, not "earthy" or too "aloft" "proud".
Scholar imagine a "new", "future", "sure" or "vacant" industry and take a big slice, but it is a fringe. They are "academic", "scholarly", "book worshiping", and "smart".
Hundreds of billions of ideas have been thought of. If something does not exist, it is because it couldn't land and thrive. If you see a spot in forest with no tree, it is not because no tree tried, but because every tree has tried. Business has no vacuum. Life has no vacancy reserved for educated smart people.
Nerdy people rely too much on projection, theory, deduction, and thinking. They "come up" with fake needs and try to take advantage of it. They try to "out smart" and find a vacuum or found a small niche. They want to do business with strangers in an empty place - "blue ocean". They don't understand that if there is no competition, there is no business. They don't understand that "every idea has been thought". What needs to be done is act.
Most scholarly or technical entrepreneurs believe their chances, they never go to market, they imagine all the scenarios, they invent and try to provide solutions and must confirm audience and their interests later, they underestimate market entry complexity, they want to capture a vacant spot and think the world is empty and merit will win.
Books are like meats. Experience and "living it" is like vegetable. It must be balanced.
Startup and small business is easy - see the need, act. Startup based on anticipated needs and problem solving is hard.
For natural startups, opportunities are everywhere. Chance to get money and please people is everywhere. For forced projected chances, the rate of success is very very low, regular investors like enterprise and banks typically won't invest. Only vulture (sorry, venture) investors would hover around.
Opportunities are spotted in market. Chances are imagined in classrooms.
Startup is A SKILL, not an IQ text or an exam. Clever people wants to spot an opening no one sees. It is wrong. Startup skill is just like football, driving, swiming. You need to learn and then you need to practice for thousands of hours and fail. Our schools and societies push a lot of people to be "entrepreneurs" but they are truly ill prepared. The books, classes and "entrepreneur competitions" amounts to nothing more than dry swimming on land. It is sad, but it is the truth.
Many VC funded companies fail, many startup companies fail after a few years. Even winning competition and selling products is not guarantee. A lot of startup companies fail because they find no paying customers.
Needs are everywhere. Opportunities are everywhere. Jobs are everywhere. Try not to start a small business or a forced business - it won't have room to grow and it will only provide for yourself. Small improvement is other people's job, not yours.
My recommendation is, never start a lean business.
If you want to startup a big business by trying, don't. If you want to start a small business, don't. It will not grow, and you won't succeed. To start a small business is hard, because you won't get funding. To start an early business is hard, because you have to wait. To start in a competitive mature area is the only right way to go but the competition is heavy.
If your company offers small improvement, the supply chain won't accept you because everyone will be out of job to accommodate you. Fat chance. Someone will subbotage the plan.
A small incremental improvement sounds safe, but you won't get funding and your chance to be rejected by the supply chain is high.
If you can not be extraordinary, do the ordinary things extraordinarily well. If you can not create, do your job well! Be a CEO, get a reputation, be a star. Although creation of company and business is best way to learn about yourself and the world, it is not necessary for everyone to join changing the world.
If you want to improve lives, do your job. If you want to help make future happen, do startup. Either way you win. There is no failure. Failure is learning, it means you try really hard.
Startup is creation, not creativity. It is the art of bumping into nature's accidents. It is unteachable. - Chang Liu
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