Last year I discussed a great article from Bloomberg Businessweek about MBA, entrepreneurship and other business program graduates noting that, in the current economic and jobs climate, some grads are deciding to create their own opportunities through creating their own new business ventures. This was exciting for me not only as a graduate finance teacher, but also as an entrepreneur and risk capital investor. What better bet for a graduating student than to put their own money, passion and hard work into the one thing they know better than any MBA course – themselves!
Every week and almost without exception, students consult with me and my fellow faculty members regarding the viability of their business plans. As any good teachers would do, we are supportive, but also always candid and honest in our comments. We are not educators seeking to dash hopes and dreams, but neither are we offering false hope for plans with little likelihood of funding, profitability and long term success.
What advice do I offer budding entrepreneurs? A few simple suggestions:
1. Maintain a narrow focus. The best plan for a bootstrap start-up is a tightly defined niche that is current overlooked or underserved. Attacking a global market in the face of established competition by offering too broad a range of products or services is generally a recipe for failure. Meet the “burning need” of the market by supplying a needed product or service, and you’ve got a winner.
2. Bootstrapping. By its definition, bootstrapping means self-sufficiency and self-reliance. Don’t underestimate the very necessary contribution of friends and family to provide initial seed capital. Don’t think it’s important? Play that scenario out as you are asked the question by an angel or other investor. “What have you been able to raise thus far?” “Well, Mr. Investor, I have reviewed my plan with the people who love me the most, know me the best, and who know my ability and work ethic better than anyone. They wouldn’t give me a damn cent!” Oops. Tough sell.
3. Differentiation. If there is one point that I believe contributes the most to proper positioning of a new venture is differentiating yourself from your competitors. No, don’t tell me that you will take better care of your customers – everyone says that! What quantitative differences separate you from the many others going after the same market?
Aside from those common sense pointers, I could continue with a lecture on the importance of dedication, discipline, passion, hard work, and so on – but then, you don’t really need a blogger to tell you that, now do you?
Can’t find the perfect job opportunity? Create your own!