Program aims to assist local entrepreneurs
By Scott Meacham
Copyright © 2016, The Oklahoma Publishing Company
Starting a successful business is a very heavy lift, even when an entrepreneur does everything right. When a new company initially sets the wrong direction and moves down the wrong path, it’s almost impossible to succeed.
That brings me to No. 2 in my series of recipes for startup failure: Entrepreneurs who believe that they are a proxy for their customers and, as a result, are on a bridge to nowhere. These folks think that just because they react to their product in a certain way and recognize the “obvious” benefits, customers will share their view.
That usually is not the case.
At i2E, we see this potential failure point all the time. Entrepreneurs underestimate and undervalue the importance and the benefits of gathering direct feedback from real customers on their problems and on their willingness to pay for alternative solutions.
That’s the driving force behind our Venture Assessment Program (VAP). In VAP, we help entrepreneurs perform market analysis and figure out the commercial opportunity for their business. This intense three-week initiative includes an analysis of pricing, competition, market barriers and profit potential, but VAP isn’t limited to an internet search or the study of published market research.
Entrepreneurs in this three-week program, talk directly with potential customers to learn firsthand about their problems and to road-test, at a high level, the fit and value proposition of the entrepreneur’s solution. When they do, they inevitably discover important facts they didn’t know — about the customer or about the market or both.
This new knowledge compels VAP entrepreneurs to reassess their business plans. For many, it’s the first time they gain an inkling that their “baby” isn’t as beautiful as they first thought.
Armed with new insight, successful entrepreneurs (the “jockeys” that investors tend to invest in) either stop chasing an idea that the marketplace doesn’t want, or they pivot.
They realize that features are missing that customers require. Or they figure out that a competitor is already doing something similar and that they need to provide a solution that’s more unique or more cost efficient. Or that solving the problem they were attempting to solve isn’t valued by the customer. Sometimes with a few tweaks and iterations, a more fitting solution and value proposition might be possible.
Once an entrepreneur grasps that future success of their venture depends on independent customer validation of whether the new business solves a big enough problem for the customer that they will pay for the entrepreneur’s product to solve it, then we can work with the entrepreneur to convert No. 2 on the checklist for failure into No. 1 in a game plan for success.
Did you know?
The top reason for startup failure (42 percent) is no market need.
Source: CB Insights
Read the full story at The Oklahoman. (Requires subscription.)
Scott Meacham is president and CEO of i2E Inc., a nonprofit corporation that mentors many of the state’s technology-based startup companies. i2E receives state appropriations from the Oklahoma Center for the Advancement of Science and Technology and is an integral part of Oklahoma’s Innovation Model. Contact Meacham at i2E_Comments@i2E.org.