How To Avoid Jumping The Entrepreneurial Gun

From over at the UNSW In The Now blog.

What’s the first thing you need to do before starting a new entrepreneurial venture? (Hint: it’s not setting up a company, finding a lawyer, or renting premises.)

The correct answer is, of course, validating whether someone’s going to buy your product in the first place. Sounds obvious, right? Yet many bypass this step in favour of jumping straight to the bit where they give up their day job, spend a heap of cash, and enter into a higher risk environment. This is especially surprising because it’s never been cheaper or easier to validate your sales hypothesis. All it takes is jumping online to ascertain whether there’s already an idea similar to yours on the market, as well as having a significant amount of actual discussions with people who might be your target audience.

Don’t worry about writing a comprehensive business plan. Instead, draw up a quick one-page business model canvas that helps you understand who your customer might be, your value proposition, key resources, channels and partnerships, and how you might actually market your idea and get it off the ground. All this can be done after-hours and, apart from your time, requires zero investment.

Amazingly, this simple approach doesn’t come naturally to most people, which is probably why a high percentage of entrepreneurs fail first time around.

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