It happens all the time.
Your entrepreneurially minded friend has this all too familiar sparkle in their eyes. You know it’s coming so you settle in your seat and prepare for the pitch. Then it comes – another idea, neither too exciting nor disruptive. But your friend continues pushing. A month later, a mock website is up and running. A few weeks later, Facebook and Twitter campaigns are unleashed. By the end of the second month, an investor’s deck has been constructed and graphic tees (with quirky logos of course) have been sent to the printing vendor. A startup has been born, albeit quite hastily.
What is the actual problem here? Some would argue that if one has the resources, creative capacity, and perseverance, then he/she should go ahead and make their dream a reality. After all, investors invest in the person(s) behind the startup… right? While the latter is true to some extent, herein lies the problem: Obsessing over founding a startup can often blind us in terms of actually creating something of substance, of true value to the consumer/end user.
So here is my list of five dangers that often accompany such overzealous entrepreneurs:
(1) Igniting Unnecessary Competition Early On: At this point in the startup’s development, there are low entry barriers. If you try to over-populate social media and PR outlets with your new, underexplored venture, you may soon realize that your friendly neighbors from Technion think they can create a better product than you can. Guess what? They probably learned from your mistakes and are now refining their offering.
(2) Cockiness: Please excuse my forwardness, but this is just most fitting. You know who I am referring to – those people with their head held way too high, the ones who barely look at you at networking or pitch events. All these behaviors and they have yet to realize true product-market fit.
My advice: ditch the act and never underestimate the power of modesty. This is no way suggests that confidence doesn’t add a much needed boost in our daily lives. Rather, I am arguing that wanting desperately to be an ‘influencer’ does not mean you can’t also be well received. Who knows, an attitude change may even serve to help impress potential investors.
(3) Early disappointment: Without a clear value proposition, your startup may soon fade away, leaving not much behind. While you will undoubtedly learn from your experience, negative feelings may soon surface, which may further inhibit your future success. Disappointment occurs in many well-developed startups, but in this case, yours may have been unfortunately foreshadowed due to an overly ambitious timeline.
(4) Running out of money… fast: Though quite obvious, this one must be mentioned. Whether it is your parent’s money or your personally acquired wealth, losing money is never fun. This can not only damage your ego, but can directly limit your ability to start your next venture. After all, rent in Tel-Aviv isn’t getting any cheaper. Ideally, try to spend more time cultivating your idea, pivoting when necessary, and build a sustainable product.
(5) Irrelevancy: This is probably the most significant of all the listed dangers – Creating a startup just for the sake of seeing your name appear on CrunchBase, without a clear value proposition. I invite both all wannabe entrepreneurs and current startup founders to read about the Lean Startup movement and customer development process before diving into the startup world. Following Steve Blank, Bob Dorf (full disclosure: Bob was my former professor at Columbia), and Eric Ries on LinkedIn would be a solid start.
So what’s the bottom line?
Many people are actively seeking a way to own or lead something, whether by building a new startup or a better competitor to an existing service. While this drive is well understood and appreciated, especially in the Israeli startup ecosystem, it should not blindly guide you into launching a venture to prove to yourself (or to others) that you are an innovator. Phew, now having said all this, go on and create something meaningful!