This is a three part series on planning a business, for context, if you haven’t read Parts 1 & 2, please head to my page and read these first. Thanks for reading!
As promised, some tips on how to get lucky;
Start – you have to be in the game to win.
There is a 0% chance of your idea succeeding if you are sitting on the sidelines.
This is the biggest inhibitor of success, you can start small and test. Often the mental barrier of starting something (like writing these posts!) is the hardest part to get through.
Everyone who is successful that you can think of at some point decided to try. You don’t have to quit your job or change everything to begin (in fact that isn’t encouraged see Part 3.4) .
Have a plan and get going in a small way, refine the plan, get inputs from the world and your potential customers, improve and go again.
Get really damn good and work hard.
Put the hours in, improve yourself and your skill at all turns.
Being the best at what you do means you are more likely to stand out if your timing is right – ie. if the world is ready for your idea.
It also means that you will be able to take territory fast, please more customers and react quickly to changes in your market.
Sarah Blakely honed Spanx through making hundreds of prototypes, writing the patents herself and personally selling them in stores. Ben Cohen and Jerry Greenfield became obsessed with creating new ice cream flavours and worked into the night doing so. You don’t have to go to this extreme, but at a minimum at the start, give it everything.
Just because I’m using the word luck does not mean that skill isn’t just as important, quite the opposite. Think of the luck I’m talking of more as probability. Become a better player and you will make more high percentage plays, winning in the long run.
Where possible, swim in a small pool.
Less competition means you will maximise your upside if your timing is right and your idea resonates. Where possible, chose less competition over a larger market.
This can be achieved in many ways, from coming up with a novel idea, taking a big idea and focusing on a different market, or focusing on a market so small other people have ignored it, among others.
The tech industry is famous at this. Peter Thiel calls this Zero to One. They invent a new product and have a competition of Zero. New Burger shops have made a profitable revival after taking the McDonalds burger, making it gourmet and selling to a different market.
However you do it, find your market and please the hell out of them. You will find once you do this, your market will open up as you grow and think of new ideas that compliment your base.
Protect the downside
You need to give yourself the longest amount of time to get lucky.
If you set yourself to get knocked out on your first try, you won’t have the ability to try again. More efforts = more chances to win.
Richard Branson negotiated to be able to return the planes he had purchased to launch Virgin Atlantic back to Boeing if the venture didn’t work out.
Think poker, it is a game of chance but you bet some of your chips on each hand. Everyone has played against that person who goes all in / bets too much on every hand, sometimes they win big, but mostly they burn out early.
Other players bet a little and when they know, they bet big.
Much like poker, business is a game of luck and skill combined. The best players protect their downside on each foray, the worst risk too much each time.
Swing the probability in your favour and live to fight another day if this one doesn’t work out. If it does, go at it hard.
Study what is common across successful people and implement these lessons.
The more these traits appear across these success stories, the more likely (only likely, not certain) they are to be causal factors.
Reading biographies and listening to podcasts about successful peoples lives is one of the best ways to get better at anything. Ray Dalio is famous for devouring books and knowledge, seeing himself objectively and using these learnings to improve himself.
We learn through perspective, reflection and comparison. Finding out about others lives and how they got there, you will pick up patterns that allow this.
And humans are pattern finding machines. Use this trait to your advantage. If you spot a pattern, analyse it to see if you think it is a causal factor in these peoples success.
Doing this while experiencing things for yourself will teach you more than anything else.
Where did I get these ideas? This blog is a combination of things I have read, heard, pondered, and in the end weaved together. At the end of each post I will do my best to provide some rough references, please let me know if I have made mistakes, as I most likely will;
- The Black Swan – Nassim Nicholas Taleb (this post leans heavily on his work)
- Antifragile – Nassim Nicholas Taleb (as above)
- Thinking, Fast and Slow – Daniel Kahneman
- Superforecasting – The Art and Science of Prediction – Philip Tetlock, Dan Gardner
- The Everything Store: Jeff Bezos and the Age of Amazon – Brad Stone
- Akimbo (Podcast) – Seth Godin
- Principles – Ray Dalio
- How I Built This Podcast – NPR
Thank you for taking the time to read this post, I hope you enjoyed it.
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Thanks in advance, I really appreciate it.
2 thoughts on “Starting a Business – Planning – Part 3”
What do you get right and why?
I am in the process of starting a business. And I am terrified.
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