Last version published: 24/08/2018 08:45
Publication number: ELQ-87069-2
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How to Pick A Business Model That Is A Match For You
How to Pick a Business Model That is a Match For You
Introduction
It’s painful when you start a new business for the wrong reasons. As a mentor to aspiring entrepreneurs, one of my challenges is to make sure their idea is a match for them. For example, I have a friend who is a self-proclaimed “foody” who wants to start a restaurant, but really has no interest or skills on the business side. Loving food does not necessarily lead to a happy business.
Of course, one solution is to find a partner who has the skills you are missing. I actually worked with Bill Gates back in the early PC days, and I’m convinced that Microsoft may have failed to grow without his partner Steve Ballmer. Bill Gates ran the technical show, but Steve Ballmer, business trained at Procter & Gamble, carried the marketing and financial side of the equation.
Many technical entrepreneurs still tend to believe that their technology and passion are ninety percent of the equation, and the business will happen by default. In my view, this mismatch of interests compared to key business drivers is the primary reason that the majority of new ventures ultimately fail. Here are some key questions I ask to get you started on the right track:
- Step n°1 |
Is there a real business need for your proposed solution?
A business need implies customers with money to spend, that have a painful existing problem. Remember that customers buy solutions, not technology, and they rarely pay for “nice to have.” Your passion alone, for your food or your product, probably won’t change the world.
- Step n°2 |
Are you knowledgeable and comfortable in this domain?
Don’t step into an arena you don’t know, just because it looks like fun or easy money. Match the business to your comfort level, such as franchising, multi-level marketing (MLM), freelancing, or a new product. Don’t forget that all business types require management and execution skills.
