So the popular narrative is that if you want to be financially independent then you must start a business. This is tied into another narrative which says that a job isn’t designed for you to become wealthy. Both these narratives are universally true no matter which part of the world you’re in. Now, here’s where most people get it twisted – they just start a business because they know that starting a business is the way to go. The pertinent principle they miss is that it’s not just about starting any business; more importantly, it’s about starting the RIGHT business. So how then can you ensure that you’re starting the right business?
Start It For The Right Reasons
If the purpose for which a thing is made is not known then abuse is inevitable. The late Dr Myles Munroe epitomized this important principle in most of his books and speaking engagements. There’s something interesting that comes to my mind as I muse on that aspect. If you start a business for the wrong reasons it means you have lost the plot with respect to the real purpose for which a business must be started. Consequentially, this means abuse will be inevitable and dismal failure will be on its way. So what are the right reasons for starting a business? I’ll discuss two which shall be my next two talking points.
Solving A Human Need
Virtually all notable global businesspersons concur on the aspect of solving a human need as a basis for a successful business. Facebook was primarily started on realising the human need for people to interact without barriers. Econet was started on the basis that mobile phone services weren’t yet widespread yet convenient. These are just some examples but the bottom line is if you’re bent on addressing a human need then you know you’re on the right path. Take Fresh In A Box, for instance, they noticed a gap between farm produce suppliers and the consumers and decided to bridge it. Looking out for a human need and solving it – that’s the pathway to a successful business.
Pursuing Your Passion (But Be Empirical Though)
When you’re passionate about a societal issue or a field of endeavour it’s often the case that one ends up starting a business in that regard. A passion can be defined as something you intensely desire or an irrational but irresistible motive for a belief or action. Based on the latter part that’s where my basis for “But Be Empirical Though” comes from. If you’re pursuing your passion as a business venture, that’s good and commendable. Actually, pursuing your passion is good in that you’ll be well-poised to brave all the challenges you’ll face along the way (which are usually inevitable). That intense desire conditions you to be tenacious and to ride on storms. There’s only one important thing to consider in balancing everything out – being empirical. What I mean is that you must not be too blinded by your passion to the extent that you ignore tell-tale signs of things that might lead to failure. For instance, you might have a valid passion but there’s no market for what your business wants to offer. Possibly your value proposition might be weak and inferior to what’s already on the market. So in a nutshell, pursue your passion but don’t neglect empirical data (which means you must still do your research to collect relevant data). They say discretion is the better part of valour so it’s important to not be recklessly blinded by your passion.
Focusing On Area Of Specialization Or Expertise
If you’re to start the right business then focusing on your areas of specialization or expertise will put you on the right trajectory. If you’re in an area you fully understand you’re most likely able to come up with ways of developing products or services with exceptional value propositions. Even as you take the business forward you can better navigate your way knowing what to do, how to and when to do it. Warren Buffet (the billionaire investor) has often advised that he doesn’t invest in fields he doesn’t fully understand e.g. technology. In that same vein, he encourages prospective investors to follow that principle. With regards to our subject matter, it also implies that it’s important to focus on areas you fully understand when starting a business.
Starting Something Scalable
This is another very important indicator of whether or not you’re starting the right business. What do I mean by scalable? Being scalable is the quality of being able to grow over time despite changes or circumstances in the operating environment. Suppose you want to start a business; try to project it say, 5 years into the future – will it still exist? Will it still be able to offer relevant products or services to an ever-evolving market? With the rapidly changing environment that we’re in that’s constantly changing due to technology innovations, will you still be a relevant business? These types of questions will clearly show you whether you’re starting the right business or not. A perfect local example of starting a scalable business is Econet. Econet started off as just a mobile service provider for voice calls and SMSes. Over the years it has managed to move with the times providing new and relevant services as the operating environment and market evolves. Had their initial business idea been poorly thought out then scalability wouldn’t have been possible. So if you want to know if you’re choosing the right business, assess its scalability.
So these are some very vital principles to bear in mind when choosing a business. Don’t just go with the flow thinking that if others did then it should be automatic for you. If you intend to build something such as a business be diligent and brutally honest with yourself. I believe these principles will guide you accordingly in making the right business choices.