Happy year of the horse

As we begin the new year, and speaking about beginning, I’ve encountered folks in my career who create their dream business on a whim without research and neglect that there are many factors to consider before taking the plunge. Things such as identifying whether there is a need that requires attention? Who are the customers? Is it worth the financial risk? How long will it take for the brand to establish itself? You may see an opportunity but without developing a business plan, you may be doomed from day one. A “build it and they will come” strategy is not something I would recommend.

In the movie Field of Dreams, Kevin Costner builds a baseball field in a cornfield and ghostly baseball legends magically show up to play. “Build it and they will come” is a wonderful movie plot but a terrible business strategy.

You may think you’ve seen examples of successful “build it and they will come”s, Amazon, Apple, The Royal Tyrell Museum come to mind, but each of these circumstances was built up slowly over time growing and changing the market they were born in, to position themselves as trusted names with expert reputations. They always were meeting an established consumer need (Convenient cheap shopping, easy to use personal computers, educational entertainment) by providing a product or service that didn’t yet exist in the market. Try to think of your own successful field of dreams examples, it’s harder than you think.

There are many reasons why this strategy flops in the real world and here are three:

1) Do you actually know what people want?

Assuming “If I build it, they will come” presumes you already know what “it” should be. Spoiler. Have you done enough homework to see if there’s a need people crave? Most first ideas are half-assed. Without talking to potential customers, doing your research, seeing if a solution already exists, etc, you risk building a beautiful, brilliantly designed (insert your idea here). Customers don’t care how hard you worked. All they care about is whether it solves their problem.

2) Have you told anyone about your idea?

If no one knows what you’ve created, how will people find you. Launching without an advertising or distribution plan is like whispering your business idea to your dog. If there’s no audience, no channel, and no consistent way to reach people, your product will sit there, undiscovered.

3) Do you have the budget to get your idea to market?

Building your full-featured product or business first, before research, is expensive and time-consuming. Investors and bank accounts are gun-shy to invest in a “We built it and now we’re ready to show with your dough” in case your hunch is wrong.

So what’s the proper way to start a business? Identify a real problem. Research. Talk to potential customers and ask what they want and build that. Are they willing to pay for an alternative solution? Get real feedback. Perhaps take baby steps and learn as you grow. But don’t just build it and hope folks will come.

Keep it creative. Cheers, mark.