What do you think some of the most unhelpful startup myths are? Things that new entrepreneurs should be warned about before they start working on their startup. What advice would you give a new entrepreneur to disabuse her or him of her/his illusions.
I'm asking because I teach beginning entrepreneurs at a university. One of the most common myths they believe is that the idea is the most important part of the startup. I would like to collate a list so I make sure I can pass on the wisdom here.
I also think it would be helpful to new entrepreneurs who are using this forum.
To add to the list, which I am sure will be developed by many far wiser than I:
The "Ownership" Myth: There is a prevailing belief that 100% is worth more than 49%. This gets in the way a lot. If by distributing 51% you are able to secure the elements needed to have a valuable business than 49% of "something big" is a lot more than 100% of "nothing happening"
The "Feature Rich" Myth: If your critical differentiation is "we will do it all integrated together" -- then it is a bad idea. Everyone -- even your "no clue competition" have plans to do it all. It is how to get there and what you roll out when that make the difference.
The "I am alone" Myth: If I read another business plan/proposal claiming there is no competition I am going to barf. On the plan. There is always competition. Think about it from the perspective of the customer's buying decision.
The "Technology First" Myth: The path to greatness is rarely having the best technology. It is far more often having the better relationship with the customer. It is a marketing game -- not a technology game.
The "Technology Only Myth": This myth is often perpetrated on this site -- the irrational and unsubstantiated myth that the world of business revolves around Silicon Valley and web-based startups. The vast majority of new startups are not in San Fran, or CA, or technology. Every day there are new restaurants, new medical device companies, new yoga studios, new energy alternatives.
The "VCRG8" Myth: Building a company through the growth of customers is like building your body through a steady workout. Growing your company with an infusion of VC money is like taking steroids. There are always consequences and choices. Success is not getting VC funding -- success is building a sustainable company that impacts people's lives.
The "Static Market" Myth: The characteristics of your market now will be the characteristics of your market when you launch and in 3, 5, 10 years. There will be other competitors. The existing competitor will respond to you. There will be changes you can't foresee. Your plans should take that all into consideration.
The "I am the One" Myth: I know, it is helpful to think you are the next Steven Jobs, William McKnight, Mark Zuckerburg, Sergey Brin or David Packard, . You might be -- but you're not yet -- so stop acting like it.
The "Make Money First" Myth: In the end when you are on your death bed -- will the amount of money you made matter? Or will it be how you impacted people's lives? The time to impact is not after -- it is now and always.
The myth of this graph: and it's various permutations that are included in most business plans.
There, have I missed offending anyone -- or did I pretty much include them all?
It should be noted that I have been a personal perpetrator of all of these myths at one time or another in my life. To all those that it negatively impacted -- I am sorry.
As an engineer who has waffled between working at startups and major corporations, I'd like to share a few myths from an engineering perspective:
Relatedly, there absolutely MUST be some regular communication from on high about direction and roadmap and so on. At the last startup I was at, there was never a single roadmap-type meeting the entire time I was there. I kept on suggesting that having weekly or biweekly sync-ups might be good; the answer I got was, "Well, we had one just before you started here." That's nice for everyone else. I never had any feeling that anyone cared at all about my contributions, or that I fit into the big picture at all.
Just because someone worked on the original PowerMac or the iPod doesn't mean they have any clue how to break into ebook readers or social networking applications. (Two actual examples from my experience.)
Myth 1: I have a brilliant startup idea that will make me rich.
Reality- ideas have little if any value. Only an implementation or substantiation of that idea has value. (A patent, a business, something actual as opposed an intellectual concept defined only in your head.) In addition, the goal of "getting rich" is counterproductive. A successful startup needs someone who is passionate about providing a solution to their customer's problems, not someone who just wants to get rich.
By three methods may we learn wisdom:In my experience learning from failure is the hardest subset of experience to learn from, even if you do apply the appropriate reflection after the fact.
- First by reflection, which is noblest.
- Second is by imitation, which is easiest.
- Third is by experience, which is the bitterest.
Knowing that you have failed doesn't necessarily tell you anything about how not to fail in the future and until you know what best practice is, it is often difficult to tell why you failed at something. I've worked on my fair share of failed projects, and it doesn't matter how many Project Post-Mortems you do, if no-one puts into practice things you decide should be improved, nothing will change - You will just keep making similar mistakes over and over.
Research shows that you learn the most from success, and one way to reinforce successful behavior is deliberate practice, which is part imitation and part reflection. Through deliberate practice you maximize the reinforcement of successful behavior while you distance yourself from, and thus minimized, the reinforcement of failing behavior.
A friend of mine used to say "Practice doesn't make perfect, only perfect practice makes perfect!". I didn't understand what she meant at the time, but now I do. It means that if you practice the wrong way, you will only reinforce that incorrect behavior - only by practicing and getting it right, will you end up improving.
Two of the top links on a google search for deliberate practice provide good summaries of why deliberate practice is important in becoming an expert, and also bring up another relevant myth.
How Do You Get to Carnegie Hall? 8 Keys to Deliberate Practice references the famous Outliers, by Malcom Gladwell, which popularized the Ericsson et. al's research that 10,000 hours of practice is required to become an expert.
Note, the current top Google link for deliberate practice is to psycnet which is selling The role of deliberate practice in the acquisition of expert performance, the Ericsson, Anders et. al. paper, which introduces the 10,000 hour concept.
One can learn what one needs to know to be successful about entrepreneurship though an undergraduate course.
Advice, failures, successes, tips that work for one company have relevance for a different company.
My most important things would be:
Hope that helps.
Worst myth ever: "If you build it, they will come."
Damn you Kevin Costner! Just kidding, I love that movie.
But seriously, you need to understand the customer's needs and involve them in the process from the beginning, otherwise you risk building something nobody wants. For details, learn about Steve Blank's Customer Development process.
Myth: Any smart Idea sells.
Had if the case Google Wave and many more of such kind would have rocked the world. I feel not only a smart idea, a proper vision and education around the product is also required.
Not sure if this counts as a myth, but I've heard it too often:
"Our plan is to get bought out by Google / Microsoft / Oracle / Cisco / ..."
Out of failure one can often find new opportunities, so is it really a failure? Failure only occurs when we don't act on our past mistakes and embrace the new opportunities that have arisen from those past experiences.