The more risk that’s involved, the greater the potential return, or put another way the greater the jam on your toast. This is simple mathematics as well as the foundation of our financial system.
You’re a wise cat, so you also know that “return” can be expressed as not just economic utility but as a quality of life. Your start-up might be about untethering yourself from the 9–5 and becoming free range. Or it might be the good old “show me the money”.
Your business, whether it be as a freelancer blogger, or as the would be CEO of the next big thing, has a chance of failing.
You can think of a big company as an oil tanker. When the oil tanker finds itself in the middle of really bad weather, the tanker is large enough that, on deck, you never really rock in the swell. This big ‘ole hunk of metal is plowing straight through to the sunshine on the other side.
The startup is a tiny dingy with a sail. Not only do you need the wind to push you forward, you also need to absolutely not get stuck in a humdinger of a storm. Your little boat is going to capsize.
Put another way, small is fragile even if you’re the best sailor, with the right wet weather gear.
So, boats and jam. The route to jam might seem straight forward, your idea might be sound, your execution might be “okay”, but you still have a huge chance of failure. External factors, either economic or sector related like weather conditions can sink you despite best endeavours. Suddenly money, time and effort has a zero return and you’re trying to pick yourself up emotionally and financially.
It sounds like I’m one of those dudes who is peddling the end of the world. I’m not, to use the words of those who eat a lot of Avocado Toast (here’s a link to several receipts just in case; variations-on-avocado-toast), I’m just trying to make sure you are “woke” to risk.
You have a 1 in 10 chance of success (lets say, to be sure, it’s probably smaller), which means there’s 9 people just failed for every one who succeeds.
So what can you do not to spend all your money, blow a chunk of your valuable life and end up with the feeling of “was it me, or was it my idea” every morning for a year.
Simples; Sell.
The easiest way to succeed is to build the biggest boat before you launch it off the dock.
This means sales. Validate your concept by doing some market research. But don’t end there.
Most people will say they will buy your product in isolation.
They might not buy your product when it comes to making a value decision between two outcomes. Let’s take a reasonably benign example; Do I buy this xxx (toaster) for £50, or do I buy a new shirt for work, that I need because my other shirt has been washed so many times it no longer looks right.
Do I buy this xxx for £50, or do I spend the money on some fresh healthy food (because I’ve just read about 5 lovely types of advo on toast) and want to look after myself?
Simple fact then, when people are supportive of your product or idea it doesn’t mean they wouldn’t buy it, but it also means when faced with a choice of buying it, or buying something which has more immediate impact and relevance to their life, they’ll make a value judgement.
Market research is not enough, your boat is still small with handkerchief sail.
You need actual money. Real sales.
If your product doesn’t exist, then ask for the butter ahead of the jam; sign up with a £5 deposit and pay the £45 when the product is ready and shipped.
Real “can see it in my bank balance” commitment is the only way to give yourself the best chance of weathering a storm. But also, more importantly, as a means of testing if you should launch your boat and point it towards Jam-land at all.
Reduce your risk. And make your choices easier. Don’t prioritise the easy things, like creating a brand. Prioritise the hard thing, making sales.
If you find you can sell it, then you should most certainly build it, or sail it, or try it, or live it.
A business lives by it’s sales, it dies by it’s sales, but more importantly it should exist because of it’s sales.
Have fun. Drop me a note if I can help.
