The entrepreneur as prospector
Entrepreneurs have one fundamental goal – to find an unmet need in the market, Dr. Cornwall writes.
When first starting a new business, entrepreneurs are not well served when they view themselves as builders or architects. That is the wrong frame of mind.Skip to next paragraph
Jeff is the Jack C. Massey Chair in Entrepreneurship and Director of the Center for Entrepreneurship at Belmont University in Nashville, Tenn.
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When entrepreneurs enter the market with a predetermined view of what they are going to build or design they run the risk of creating a business that does not really fit with what the market wants.
Steve Blank, successful entrepreneur and author, cautions entrepreneurs to learn the difference between the searching stage of launching a new business and the executing stage.
During the searching stage, the goal is to test what we think we know about what the business should be. What the entrepreneur thinks the market needs, and what people like me who advise entrepreneurs think, are only initial educated guesses. When you first launch a business you should be ready to “dance with the market.” And you should be ready to let the market lead this dance.
Rather than thinking of themselves as builders or architects of a business, entrepreneurs should think of themselves as prospectors.
Prospectors have one fundamental goal – to find gold!
Prospectors have a general notion where gold might be, but they know it is going to take some digging to find it. They may think a certain hill might hold promise, so they test that hypothesis by grabbing their pick and shovel and getting to work. If that hill does not contain gold, they move onto the next prospective site.
Hopefully, if they work hard and follow their knowledge, patience will pay off and eventually they will strike gold.
Entrepreneurs also have one fundamental goal – to find an unmet need in the market!
Entrepreneurs have a general idea as to what the market needs. But just like prospectors, they should be ready to do some digging to make sure by testing their business concept in the market. The best way to do this is with small market tests as you add the first few customers. Eventually, if the entrepreneur pays attention to what customers are telling them, they will find a “vein of gold” in the market.
Andy Tabar, an interactive marketing consultant and Belmont University alumnus, found his vein of gold after several years of prospecting in the market.
“Now I’m only considering clients that have a consistent and reliable marketing budget, are large enough to have many departments, and that are lacking on the technical side of the house,” said Tabar.
“Once I had more than one client with these traits, I recognized it as a vein of gold,” Tabar added. “It takes time for true veins of gold to develop. When you have grabbed ahold of one, squeeze it until you find more gold.”
After you have found your vein of gold, then you are ready to move to executing stage and begin to build a business round the opportunity.
Just like a prospector looking for gold, the entrepreneur has to work hard and be patient until the market leads him to where his business needs to be.
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