I tend to be a bit of a geek about business plan competitions. I love judging them! The ideas. The possibilities. The numbers and research.
Recently, I participated in another competition. In just a few hours, I heard dozens of aspiring entrepreneurs share their ideas. Taking in all of their stories at once was powerful. The strengths and weaknesses stood out clearly between the entrepreneurs who had a unique way of reaching their markets and those who hadn’t done their research.
Two lessons emerged from the judges’ feedback. I’d like to share these nuggets with you because I think you can benefit whether you are an up-and-coming entrepreneur or one with some experience in the game.
If you have an idea for a business, stop waiting until you have a full plan written. Get started marketing and selling.
Ideas are great. But it’s better to make mistakes with your customers and get started.
As a small business coach, I’ve heard hundreds of great business ideas. Products that are guaranteed because the market “needs” them. Business plans that highlight how they can succeed with only 1% – or some other small number – of the total market.
These ideas seem good until the entrepreneur actually starts selling the product and finds out that demand isn’t quite as great as projected.
So if you have an idea for a business, stop waiting until you have a full plan written. Get started marketing and selling. And listen carefully to the feedback that people share. Does your product really solve their problems? Do they have different problems they would pay money to solve? Are you missing out on immediate cash because you want to wait until your business idea is perfect?
Let me share an example:
A caterer decides to start selling a new product. She is in love with baked goods and wants to branch out beyond traditional lunches and dinners. Rather than investing money in new baking equipment, she attends some local networking events, volunteers at a few community gatherings and finds other ways to distribute product samples. She listens carefully to what people like and dislike and identifies if they have a specific need for catered baked goods. And when she has her first 10 orders in hand, she invests in the equipment and inventory to bring it to the market.
This approach differs from what many entrepreneurs do. They want to wait until their product or service is perfect, they look completely professional, and everyone will pay top dollar.
Stop waiting for your idea to be perfect. Start looking for customers and problems you can solve with the idea you have now.
If you have a good idea, invest the time and resources to find good business mentors.
You can’t run a business solo. Get good advisors in your corner.
For the Q&A portion of a competition, the judges prepare a list of questions to see if the entrepreneur really knows his or her business – or is just well-rehearsed. After judging several business plan presentations, I can sense when the Q&A portion will go well. It’s always a great moment when you find an entrepreneur who knows the business inside out. A key theme usually emerges: The well-prepared entrepreneur has sought out a mentor – a friend of the family, someone they met in the industry or a top industry expert they actively solicited to help with the startup.
Let me share another example of two different entrepreneurs who want to start brick-and-mortar stores:
The overly optimistic entrepreneur presents full plans about the space, including leasing and insurance quotes, layout, inventory. This entrepreneur knows a loan will be necessary to get started.
The savvier entrepreneur tells the judges about her current customers. Perhaps she is vending at local flea markets, sending newsletters to everyone she meets at networking events, or selling on an online platform like Shopify or Etsy. While she doesn’t know where the space will be or how much it will cost, she knows she has a list of people ready to show up when she opens the store on the first day.
Guess which one the judges will likely back?
If you have a good idea, invest the time and resources to find good business mentors. You will save tremendously in the long run if you can get someone to share with you what you need to do to improve your business model and then implement their suggestions. This applies even if you are expert in the industry and even if you have run other businesses.
The advice-following portion is key. In the second example, the entrepreneur was actually afraid to present her idea. She didn’t think she was ready to move into a brick-and-mortar space, which was being provided to the winner of the plan.
But she was ready. And her mentor saw that and pushed her.
You do need to gain skills around finding and maintaining solid mentor relationships. Some will benefit you more than others. But in the end, entrepreneurship works best when you gain insights from advisors. Even the best players in professional sports have coaches!
So turn your ideas into long-term winners by investing in solid advice. Sure, you’ll make mistakes, but you’ll learn that others have too. And you’ll learn how they’ve recovered and gone on to prosper.