If you want to conquer the world with your tech product then do it by your own ships!
There are many who believe if they have a brilliant business idea, they are entitled to the resources from others to bring their ideas into this world.
Unfortunately, the reality is quite different!
I see many passionate and inexperienced entrepreneurs who believe that once they pitch their idea to investors in a few minutes, money would be raised immediately. The media loves to share news of small-time entrepreneurs securing financing – it often sounds like they have won the lottery!
I also have people coming to us with early business ideas asking us for a quote! This is like going to a construction company directly and asking them how much it is going to cost you to build a house.
In both of these instances, there is a great discrepancy between people’s understanding of building a tech-based business and the reality of it.
At Engenesis we believe that a number of factors have led to the conundrum of a severe under-estimation and under-valuing of the technology building process. Let me touch on them before I address the main topic of this blog post.
When people think about technology, they think everything is fast. They are used to ordering products to their doors within 2-3 clicks. They can get market data in 60 seconds that previously took days or weeks to obtain.
However, when it comes to building technology, they also think it is meant to be a fast process. In reality, a team of designers, engineers, and developers spent days, weeks or even months to achieve the simplicity of a 3-click user-friendly process.
When people collapse technology with ‘being fast’ and then start the development process, it can be a disaster! We believe in being progressively fast rather than being in a rush: being deliberate and cautious on the important decisions, and moving fast once they are made.
Have you ever read an article in the media that said, “Entrepreneur works hard for 3 years and has nothing to show…?”
Of course not! The media, understandably, only post news that grabs people’s attention. Showing stories about the mundane or hard work often is not at all appealing to them or their audiences.
However, once the hard work is done and the product or business is ready, it tends to be hailed an ‘overnight success’.
For people new to the scene, it can be difficult to truly know the work it took behind successful products and ventures that made them a success.
How do you know how a house gets built, when you never have done it yourself before?
I would say a lot comes down to you having access to seeing the construction process take place around us. We see excavators digging up the ground. We see concrete being laid. We see the skeleton structure go up before the brickwork is done.
When was the last time you saw half an app?
For most people, they either see nothing or an app built completely. There is little understanding of the process that goes on in between.
Your objectives and strategies should be defined through Business Design practices, Business Analysis and Market Research and result in an IM (Information Memorandum). Then the initial Visual Prototype needs to be designed before you approach a professional investor so that they see a level of clarity.
A typical investor does not find their money winning the lottery. They did hard work, took calculated risk, paid taxes and made their money. Simply put if someone has capital to invest in your business it is probably because they had the habit of valuing money! There are chances that you can approach family, friends and angel investors and raise funds which is outside of the scope of the topic of this blog post.
My kind recommendation to first-time entrepreneurs is to be patient, do your homework, bootstrap (tip your own money into the business), design your product, build your first version of your product (MVP), attract some beta users / early adopters through your network and then approach investors.
Put yourself in their shoes and ask why they should risk and invest their precious money into your business.
There is a perfect analogy of the investor to entrepreneur conversation in Game of Thrones television series. The visionary princess Daenerys Targaryen has the desire to reclaim/overtake the kingdom and has not enough resources. The way she makes requests of the Spice King reminded me of how many entrepreneurs approach the investment process.