3 Day Startup has worked with tens of thousands of student entrepreneurs over the years. We have seen many myths over the years. Here are a few favorites.
Startup myth 1: people will steal your idea for a startup
Our first idea for a startup is like our first child. In our certainty that it can change the world we are blind to its weaknesses. This lack of objectivity sometimes causes young entrepreneurs to over-inflate the significance of an idea.
Believing that the idea itself has tremendous value will almost certainly lead us to be secretive (the world is full of mentors and professors who still tell students to “keep quiet and make people sign non-disclosure agreements,” advice my grad school advisor gave me only a few years back).
We know the idea myth is real because we routinely receive emails from students asking how they can maintain their secrecy in an open, collaborative environment.
The trouble with the idea myth is that it downplays the level of hard work required to launch a company. While having a great idea for a startup is important, it matters little in comparison with the ability to develop and execute a sophisticated business model.
Moreover, your idea will change. When I spoke with Bart Bohn (Tech Stars alumni and current director of Wireless at Austin Technology Incubator) about the most important factor in applying to an accelerator, he answered almost before I finished the question. “Team”, he said. Your idea can and will change. A great founding team will weather those changes. A poor team will rigidly cling to their original idea, which will weigh them down into obscurity.
Startup myth 2: Investors hear a great idea and whip out their checkbooks
Securing investors is an excursion which, according to Vijay Thakkar, the founder of Jolly Company, “will take up 80% of your time as an entrepreneur.”
In other words, landing investors is no casual undertaking.
Consider this: for all intents and purposes, your investors will be your employers. They want to know you and your startup are a winning bet. Expect them to fill a dossier on every salient detail on you and your company.
Young entrepreneurs will be tempted to snatch the first check they see, no questions asked. This is almost always a mistake that can precipitate a rocky partnership.
Serious investors will expect entrepreneurs to throw countless hours into learning everything they can about the person who wants to make their dreams a reality. You need to know your investor. Who have they invested in? What is their relationship with previous companies in which they have invested? Do they share your values? Will they give the right amount of time and attention to make you succeed?
“I needed his permission to die” was how one serial entrepreneur once reflected on the overbearing nature of his first investor. Know your investor.
Startup myth 3: people read business plans
Business plans are slowing meandering down the MySpace path to irrelevance (some would argue they arrived long ago). We see a trend in schools decreasing their emphasis on business plan competitions for short-form intensives such as 3DS, as well as pitch competitions.
The trouble with business plans is that you are attempting to predict the future, rather than taking iterative snapshots of the present, learning from them, adjusting and evolving quickly.
Unless it is requested by a serious investor, any student considering writing a business plan would be better served to spend those 50+ hours on an application to TechStars or Capital Factory Accelerator.
Startup myth 4: you’re not an entrepreneur unless you’re “taking over the world” and “disrupting” industries
Venture capitalists aren’t looking to make a tidy return on their investments. They want to take down giants. To that end, the language of venture capitalists is ubiquitous in the startup world.
Aspiring entrepreneurs often end up mimicking VCs by dropping comments about “taking over the world…” or “disrupting the peppermint yo-yo industry by…”
Nobody should ever be faulted for being ambitious. But is it possible that student entrepreneurs are setting themselves up for failure? Is anything short of becoming the next Steve Jobs a disappointment? Is there any fault in a startup that simply makes enough for its founders to live comfortably?
Startup myth 5: brilliant young coders will build your app just for experience
Coders are not hurting for work. If you are a non-technical entrepreneur seeking a talented coder, the supply is thin.
So how do you land a coder? First off, they won’t work for equity, and they don’t need to fill out a portfolio. If you want to work with a developer you either make them an equal co-founder or you pay a good wage.
Knowing some coding also helps communicate realistic expectations. You’ll get a better sense of what developers can accomplish and how long it takes.
Startup myth 6: all startups are tech related
Remember “there’s an app for that”? That was so five years ago. It was only a few years ago that apps could do everything from identifying constellations to finding a friend with whom to share a plate of fish sticks and tartar sauce (somebody really needs to develop a “fish stick finder” app).
Yes, when we hear stories of startups that blow up overnight, they are usually tech. This does not mean that a startup must be tech-related. At 3DS, we see an increase in non-tech startup ideas. Sure, these concepts might not achieve the mind-numbing climb of Slack and Instagram, but they are plenty feasible.
Startup myth 7: people care about your startup
It’s natural to see ourselves as the center of our own stories, as though we are peddling through the early days of our autobiographies. Thinking like this can put us at risk of not objectively approaching the problem our startup solves. As Ash Maurya states in running lean, “customers don’t care about your startup, they care about their problems.” Well said.
Startup myth 8: your startup needs to be something no one has ever thought of before.
This misconception is bound up with the idea myth. We are only human, and we want to see ourselves as clever. We want to believe that we came up with a concept of truly original genius.
If you look at most great breakthroughs, however, they were neither unique, nor original. From the lightbulb to YouTube, the success of most great ideas was iterative, based on analogy, and not terribly unique. That’s OK. Your startup doesn’t need to be unique, it just needs to solve a problem.
Startup myth 9: customers care about clever features.
We have observed time and again that startups do well when they reduce complexity. Features add complexity. Complexity adds weight. Features require more thinking and input from your users. Every second that requires a customer to think and add input increases your likelihood of losing that customer forever.
As an entrepreneur, your job is to solve your customer’s problem as elegantly as possible. Features seldom solve problems.
Startup myth 10: if people aren’t interested in your startup, it means you’re a visionary.
Some take rejection harder than others. It’s tempting to explain away criticism and apathy as coming from laggards that don’t know what they want.
Disinterest from potential users can be tricky terrain to navigate. We at 3DS encourage students to talk to countless customers to better understand needs, problems and pains. An inability to find interested customers may mean that your startup doesn’t have wheels. It could also mean that people you are talking to are not your customers. But before dismissing dissenters as fossils who don’t know what they want, be sure that someone out there does.