Advice to an entrepreneur part 2
Last week, I received a letter where the person wrote: “I graduated five years ago and had a job in a company, but I did not like it, so last year I quit. I have read many books on startup and wanted to build my company. My dream is to be a successful entrepreneur, but I do not know how to start. My friends suggest that we open a special coffee house like Starbuck or a restaurant, but I do not have a lot of money or knowledge in these areas although my friends think we can make a lot of money. Please advise.”
Answer: I have written several articles about entrepreneurship and startup, and you can review them on my blog. It seemed that there is a misunderstanding about the “terminology” that I used. Today the term “Entrepreneur” is used when people discuss new technology ideas and technology startup businesses. If you want to start a coffee shop or a restaurant, then you are a “small business owner” NOT an entrepreneur. Technology entrepreneurs have a vision of what future could be for their product or services. First, their product must create a “new value” to the market. Secondary, they want to “disrupt” the market and grow the company bigger. The coffee shop or a restaurant is NOT new and DO NOT disrupt the market. To disrupt the market, you need technology.
I know many people talk about “entrepreneurship, ” but they confuse between starting a “small business” and starting a company that “disrupt” the market. For example, Apple disrupted the phone market with the iPhone. Google’s search engine is NOT a disruption; it is NOT new, even it is fast and better than other search engines. Google’s success is in its online advertising where it disrupted the advertising market and makes a lot of money.
To be an entrepreneur, you need to have both strong technical skills and business knowledge. Technical skills allow you to develop something that can solve problems and create new value. Business skills will help you to disrupt the market. Since I do not know about your education and experience, it is difficult to give you further advice. However, I would caution you on the idea of starting a company to make a lot of money. As I have written before, the startup is NOT about making a lot of money but it is a passion for change and do something that you love. Money only comes after you successfully create new value and disrupt the market.
There are many “Hypes” about startup trends that I have seen in Asian countries lately. I could advise that you must be very careful about this “Over-hyped” trend that it is easy to get rich. Startups rarely succeed unless they are disruptive. If you look into countries like India and China where a few years ago, many young people were dreaming of being the next “Steve Jobs” and “Bill Gates” and ask “What has happened?” Why these countries do not have many successful startups? Even countries with strong technology workforces like Japan, S. Korea, Germany, England also do not have many startups as they should. It is important to understand the market and the needs before doing something and regret later.
I know that you may not agree with me or like what I write, but my last advice is to be practical with yourself and knowing what you can do and what you cannot do. The startup is easy to talk but difficult to do, and disrupt the market is even more difficult.
Sources
- Blogs of Prof. John Vu, Carnegie Mellon University
