One of the core questions of entrepreneurship is why person A did recognize and capitalize on a particular opportunity and not persons B through Z? Why did she recognize and exploit that opportunity and not me? Well here are few thoughts on this question. First, she was looking for opportunities. If you’re not actively searching the odds of spotting anything of interest are pretty minimal. Opportunities do not just jump up and bite you on the tush, at least not usually. Search is an active process (see my previous post on opportunity gaps) not a hobby. If you’re not looking you’re not likely to find it. Second, you’re much more likely to recognize and successfully exploit an opportunity in your ‘Entrepreneurial Sweet Spot’. Your ‘Entrepreneurial Sweet Spot’ is where you prior experience & knowledge, contacts and networks, and capabilities converge. It’s the space in a market that you are most likely to see the opportunity first, but more importantly, be able to muster the knowledge, resources and people you need to successfully exploit the opportunity. Successful entrepreneurial search is much more likely to occur in markets that you know well or in markets that are tangential, but close to what you already know. Searching broadly and randomly, or following the herd and the buzz around the next big thing, is unlikely to lead to useful discoveries. Focused search based on applying your skills, knowledge and networks to gap in between existing offerings and what is possible is far more likely to lead to success. Every potential entrepreneur out there should have a personal inventory of their knowledge, skills, and networks. What do you know? What can you do? Who do you know? Where do these converge to create a unique opportunity for you? These are the questions every entrepreneur should use to guide their search. So back to the original question – “why her and not me?” the answer generally lies in an active, focused search process designed to build on what you know, who you know and what you can do.
This is perhaps the smartest thing I’ve ever heard an entrepreneur say about the process of opportunity discovery. Opportunity discovery is the process of envisioning the gap between what’s possible and what is currently being offered – the larger that gap the greater the potential opportunity. If you combine this with the insight I heard in long ago in a lecture by William McDonough, one of the leading thinkers on sustainability “Anytime you think we’ve designed everything so perfectly and so efficiently just ask yourself how long it took the human race to figure out where to put the wheels on a suitcase”. Opportunities abound for redesigning, reimagining existing products and services that have become taken for granted. Industrial designs like the paint can are over 100 years old – why are we still pouring paint out of a tin can that has no pour spout and requires tools to open? We honestly can’t do better? Of course we can and we did. Nottingham-Spirk redesigned the paint can for Sherwin-Williams and in the process added to their success. So as a potential entrepreneur as you walk through life you should be asking yourself “What’s not there?” “What’s not on the shelf that should be?” “Where are the gaps between what is currently being sold and what is possible?” These gaps are the essence of entrepreneurial opportunity and filling these gaps with new and better products and services is the mission of entrepreneurship and the benefits entrepreneurial action provides society.
Of course it can. There are some who would say entrepreneurs are born, not made, but those folks overlook the fundamental behaviors of successful entrepreneurs – most notably – to actively identify and manage risk.
I’ve spent decades discussing risk with entrepreneurs, and contrary to the romantic hollywood-inspired notion of all entrepreneurs as Vegas-style risk takers, it seems there are at least two categories – some entrepreneurs (successful?) search out points of risk in an opportunity and set about to manage the risk, while other entrepreneurs just don’t see risk and plow forward blindly. Even this is a dangerous generalization, but one that is more useful.