How to be a successful entrepreneur?
Entrepreneurs often start company from an idea. They believe that the idea based on their knowledge is sufficient. An idea is only good when it creates value. Value is what customers believe, NOT what entrepreneurs think. Value is the reason why customers are willing to pay for it. Value is the reason why customers buy from you and not from somebody else. Value is a solution to a customers’ problem that they cannot solve by themselves. Basically, value is the benefit that startups offer customers.
Today value is about how to use technology to benefit customers, society, and humanity. It is about replacing outdated and obsolete way of doing business with a new and innovative way. For example, with iPod and iTunes, Apple created an innovative way that transformed a computer company into a dominant force in music industry. With iPhone and App store, Apple created a new way that transformed a computer company into a dominant force in the telecommunication industry.
An idea is a personal concept that you have in your head. It must be developed into a vision statement with details about how to bring value to customers. How do you create value in a highly competitive market? You cannot follow the existing process because in every market, there are established companies. You are newcomer and cannot compete with them unless you have something that they do not. That is why today most startups begin with technology. For example, Jeff Bezos wanted to sell books but he knew that he could not compete with established bookstores. In the U.S. there were five giant companies that control several thousand bookstores. The only way to get into book business is to use technology to disrupt the market. A disruption is something that interrupts a market that results in a displacement or discontinuity of a business. Disruption changes established business in a way that it does not expect. Jeff Bezos used information technology to sell books on line. Within ten years, he grew Amazon, the online business into a giant company, destroyed most bookstores and put four out of five giant book companies out of business.
To succeed, entrepreneurs must use technology innovation to create new markets or disrupt old market. That is why today most entrepreneurs are people who study in STEM fields (Science, Technology, Engineering, and Math). History of mankind is full of technology disruptions. For examples: In the fifteenth century, Johannes Gutenberg invented printing machine and completely changed Europe. Before that, everything had to be copied by hand and it is expensive. Only the very rich can read books; only aristocrats can have access to knowledge. With printed books, everybody can read and learn new things. As knowledge spread, Europe quickly changed from an agriculture society into an industrial society. The same thing is happening today with the Internet and mobile phones. Not long ago, communication is expensive, especially for long distance telephone call. Telecommunication is controlled by few giant companies until a small company called Skype created a new innovative value: Cheap long distances calls and free Skype to Skype calls. Today Skype is the largest long distance telecommunication company in the world. What happened to other telecommunication companies? Most of them were gone out of business because their tradition business process was disrupted and destroyed.
How can entrepreneurs invent, design, and disrupt old way of doing business and position startups into a powerful enterprises? How can small startups challenge large and well-established companies? How can entrepreneurs turn their visionary ideas into a successful business? It all begins with technology knowledge. That is why STEM is considered the foundation of all future technologies, all future businesses, and the key driver of all economic growths.
As startup moves through its process from small company to large enterprise, each step must be validated. As it moves from garage where idea and vision are developed to local market, it needs to utilized technology as much as possible. In this competitive global economy, speed is the rule. If you move slowly, you will miss the opportunity. Therefore, startups must be designed to be a competitive force that can disrupt the market as it moves from local market to national and global. As startup moves from one market to the next, it will encounter a whole new set of problems and challenges. Each of them will be a new learning opportunity. Entrepreneurs must learn quickly and adjust the way they do business to survive and keep ahead of their competitors.
Entrepreneurs often start company based on their knowledge. But KNOWING is NOT enough. They must also LEARN new thing as they encounter challenges. Without learning new thing, without an open mind, with a “self- satisfaction” attitude that they know enough, they will fail. Many successful entrepreneurs also failed because they CANNOT LEARN new things. Technology knowledge changes quickly, what you know today maybe obsolete tomorrow. You cannot rely on what you know to survive in this fast changing world. As I mentioned previously, entrepreneurs must follow a “dynamic process”. Startup is only a temporary organization that is still seeking market and customers. It will evolve and adjusts to new environment and new challenges. Therefore entrepreneurs must continue to learn and be LIFELONG LEARNERS.
If Steve Jobs did not continue to learn new thing, Apple never become the largest company in the world. If Steve Jobs were content that his knowledge was sufficient, Apple was still be in computer business with Apple 2, and Apple 3 and could not compete with the PC market and Microsoft. If Steve Jobs was happy with his success in computer, Apple never got into music business, or mobile phone business.
If you want to be an entrepreneur and start your own company, you need three basic skills: Technology knowledge (From STEM); a willingness to take risks to pursue your dream regardless of failures; and a Lifelong learning attitude.
Sources
- Blogs of Prof. John Vu, Carnegie Mellon University
