My phone rang this weekend and on the other end was Ed. Ed and I have known each other since high school. After college, I started my entrepreneurial pursuits and he started the climb up the corporate ladder.
By any measure, Ed has had a very successful career. He enjoys his job and makes a good living. But this past weekend, things changed. He just celebrated his 38th birthday. With the celebration, came that “holy crap, life is flying by” thought. And with that came the “if I don’t go for it now, I never will” thought. He decided this was the moment to start his dream. He quit his job and called to seek my advice on entrepreneurship (and to bust my chops for forgetting his birthday).
He doesn’t have a company yet. Not a single customer. Not even a prospect. Yet, Ed was planning to put all his savings into making the world’s greatest software system.
Here’s the problem: The software clearly serves Ed’s passion, but that’s not enough. It also has to serve his client’s needs. And with no clients, how does he know if it will be a hit? Does it really make sense to put all your cash and efforts into something you aren’t sure people are going to buy?
Here is what I told Ed: Don’t spend your money building a tanker ship when you are setting sail in a pond. You see, when you start your company, what you think is going to happen probably won’t. The customers you imagined may never appear. And the niche you were confident you would “own” might end up being not so “ownable.”
Launching your first startup is like going boating for the first time. You are best served learning to canoe in a pond. If you capsize a canoe in a pond, you can quickly swim to shore and start over again. Shoot, if it is shallow enough, you could probably walk to shore. But if you try putting a tanker in a pond, you’ll just get stuck in the muck… and you will be a useless eyesore to most. Way too much ship (cost) for way too little water (customers).
And don’t even dare think about canoeing in the ocean. You could lose your boat after being hit by just one wave. Try swimming to shore when you’re out in the ocean. Forget about it. The logical thing is to put a tanker in the ocean, but if you have never piloted a ship before, you probably won’t even be able to navigate yourself out of port.
Master your skills by selecting a small boat (spending a modicum of cash on your business) and see how you do. Once you start getting the hang of things, upgrade to a larger boat and sail in a larger market (lake). Then, when you are ready for the big time, build yourself a tanker ship and set sail in the blue ocean. That’s what I told Ed and I hope he is taking my advice.