5 lessons for entrepreneurs

For those of you who are addicted to self-employment and solving problems to make a living, here are some interesting lessons and tips.

  1. Passion - We all know how important passion is as a driving force for anything you do. But your passion can also be your business greatest weapon. Jonathan Betz makes an interesting point where the founder's passion can make a huge difference.
  2. Find (and solve) problems that others have ignored - Quote from Intuit's co-founder Scott Cook in an interview about how they built Quicken and Quickbooks.  This should be obvious but it's worth reminding that unless your product solves a real problem, it's not a business.
  3. Test your idea first - It's very common for you to want to jump in and start working on your idea right away but you should test it out first. Test if there's a market and if anyone would pay for it. What Buffer app did to test their idea is something we should all learn from.
  4. Advertising isn't a business model for everyone - The idea of starting a site and slapping Google Adsense to make a quick buck sounds easy and attractive but it isn't viable for everyone. Advertising is only valuable when a user arrives at your site with an intent to buy/search for something. Read this post on how the position of your product/site in the customer's decision process makes a big difference. Ideally, you'll want to be first in the process like Google/Facebook/Twitter.
  5. Patient for growth, impatient for profit - Clayton Christensen said in his book, Innovator's Solution that there are good money and bad money. Businesses should become profitable before they become big. Raising money to grow and scale before finding a solid foundation for profit can be very dangerous. This is exactly what's happening with Groupon.
Personally, I've been trying to apply these lessons but hardest thing is to identify a problem that's worth solving. But when I do find it, I'm going to test it out by building a minimal viable product first.