The changing landscape of the United States economy has thrown curve balls at us all. While unemployment has been trending downward since 2013, there seems to be a glaring disparity between employment opportunities for qualified individuals and the professional sector’s permeability. If there are so many people working, there must be tons of jobs, right? Unfortunately, this is not the case.
So what do we do when we cannot find work? We make our own! Enter entrepreneurship and startup development. Numerous individuals have honed their creativity, formulated the one idea that will carry them to the top, and built their own company around that idea. However, there are many roadblocks that can arise in an effort to bring a company from the idea phase to the next level. It may seem daunting but having an entrepreneurial mindset will help anyone jumpstart their startup effectively. The following conceptual framework is a good way to start.
What often shoots entrepreneurs in the foot is the lack of willingness to hear ideas other than their own. The “my way or the highway” approach does not necessarily lead to good performance outcomes in the startup realm and there is often a collaborative component in forming a business model. Even if your team consists of just two people, it is important to translate ideas between one another and consider alternate perspectives in bringing an idea into fruition. Whether it is the necessity for modification of a certain section in the business plan, the decision of what potential markets the idea can be applied in, or any other details that need to be ironed out in this phase of startup development, soliciting feedback from your surrounding environment is crucial.
Assess real risk when making decisions
Entrepreneurs perceive risk in a much different way than many individuals do so. When considering the risk-reward balance in making a decision, analyzing the potential to return to the status quo in different routes taken should be a priority. It is difficult to assign probabilities to certain outcomes after a decision is made, and it is even more difficult to determine what the possible outcomes of a decision are in the first place. Entrepreneurs do not take more risks than other people, but they have drastically different perceptions of risk and they recognize the value implications of risk. If you drive to perceive risk rather than to attain certainty, you will find a much higher comfort level in decision-making.
Do not get complacent
There is a common tendency to arrive at an idea and move no further. When an idea is created and remains stagnant, this is where the problems start. Entrepreneurs need to be constantly looking at their idea from all angles possible if they expect to form a sustainable business around this idea. If your idea is a product, you need to ask yourself how you can make your product better on a daily basis. If your idea revolves around a service, then what modifications can you make to the service provision that makes it better than similar services out there? Improvement is not just a goal; it is a necessity.
Maximize social capital
How many times have you heard: “it’s not what you know, it’s who you know?” Well as annoying as it may be, it is quite true. Harvard University’s John F. Kennedy School of Government defines social capital as “the collective value of all social networks and the inclinations that arise from these networks to do things for each other.” An expansive network can provide entrepreneurs with many assets. The knowledge that is attainable through relationships in your network can be of great use. Additionally, the resources that your network can provide are invaluable. Financial resources are significant, but there is so much more out there in terms of situations where your network could be of service. We often think of capital as financial assets or equipment that is used in production, but remember that social capital can be of more value than other types of capital in many cases.
Building a successful company from the ground up is far from easy. So much can happen in the blink of an eye, and entrepreneurs are constantly on their feet making adjustments to their schematic. It is important to acknowledge that not everything is going to go as planned and that one setback is not the end all be all. According to Fortune, nine out of ten startup companies fail. Now, this may provide a grim outlook for your prospects, but have no fear! If you are able to use this fact constructively then dealing with adverse situations will be simplified. Keep in mind that the odds of what you are trying to accomplish are not in your favor and use that as not only motivation, but a tool of toughness in turning your idea into a reality.
Anyone can have an idea, and anyone can form a degree of confidence in that idea. However, it takes individualism, intuition, tolerance for ambiguity, and much more to turn an idea into reality. In keeping these five strategic points in your back pocket, you are already in a much better position than many other prospective entrepreneurs.