Starting a Business QuickStart Guide. Ken Colwell PhD MBA

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      Quick Case: The smartphone market is littered with new entrants that ultimately failed due to the overzealous adding of features without tangible benefits. In 2005, ESPN, the Entertainment and Sports Programming Network, decided that what the smartphone users of the day were missing was an ESPN-branded phone. In the days before apps were the established standard, the ESPN phone could receive up-to-the-minute sports alerts and was truly a cut above other phones for the sports enthusiast when it came to sports news and scores. The phone flopped and was discontinued nine months later after reaching 30,000 customers—well below the 500,000 ESPN needed to break even on their investment.²

      While the sports alerts feature certainly did provide enthusiasts with the benefit of very current news and scores, the phone fell short of consumer expectations in nearly every other way. The high price tag, cut-rate hardware, and restrictive contract failed to impress. Furthermore, ESPN committed to the release of this phone while simultaneously offering sports news and scores through services available from Verizon, Sprint, and other wireless carriers.

      In the end, the phone did not do enough to solve the problems faced by its prospective customers, and it also failed to thrill. ESPN relied on brand recognition and a high-powered marketing campaign to pick up the slack in their value proposition—never a good idea.

       It Exists in a Strategic Space That Isn’t Too Crowded

      It’s no secret that new ventures are entering a business landscape that is already crowded with established competitors. This means that the best way for new ventures to survive is to carve out a niche that they can dominate rather than compete as a small fish in a big pond. The space that your venture occupies can’t be written on a scrap of paper and pulled out of a hat. You must position yourself strategically.

      What this means is that while passion about your venture is a necessary prerequisite for success, it isn’t enough. Just because you’re passionate about fitness does not mean that your gym will be successful. There are a lot of gyms out there—what sets yours apart?

       It Maintains a Competitive Advantage

      Competitive advantage is what makes your venture better at doing whatever it is you do than your rivals in the same space. Competitive advantage is detailed in the next section, but for now, know that if your opportunity can’t be executed strategically in a manner that allows you to maintain competitive advantage, then it isn’t a great opportunity.

       It Has a Reasonable Potential to Help You Achieve Your Goals

      Successful entrepreneurs don’t start new ventures because they believe it’s good for their health, and they don’t start new ventures to get rich. When it comes to moneymaking potential, starting your own business is one of the worst ways to become independently wealthy. In fact, once your venture clears the startup stage and begins courting investors, remember that professional investors tend to shy away from entrepreneurs who are looking to get rich from their business.