How to Be a Successful Entrepreneur

Whether you’re an aspiring author, musician, or first time business owner, this article is for you.

If you are trying to figure out how to be a successful entrepreneur, you need to recognize the changes that are happening around you and position yourself to capitalize on those trends.

Of course, often times, that’s easier said than done.

Here’s a step by step template on how to be a successful entrepreneur. Take it and customize it to your own unique situation.

Step #1: Recognize change

As I mentioned, if you want to be a successful entrepreneur the first step is to actually recognize what’s changing so that you can try to plan your next move.

So, what is changing?

In the larger picture, the thing that is changing is how our culture consumes and interacts with businesses. The Internet and social media has, essentially, disrupted this power dynamic and has shifted a small amount of power to the consumer.

As a result, this has disrupted many of the traditional business models and has presented opportunity for new players to join the game.

A while back I wrote an article for my friends over at SpinSucks that touched on how businesses, from a marketing perspective, are trying to capitalize on this opportunity and are racing to create a business model that successfully monetizes word of mouth.

The reason they’re taking on such a drastic change is because they know that their business model will soon be outdated if they don’t.

Consider what has happened to the following industries over the past few years:

1. Publishing Industry – In the past, if you wanted to be an author, you simply went to a book publisher, struck up a deal, and they pushed your book out across their distribution channels. As you well know, the Internet has hit this business model hard. It’s no longer a realistic expectation for most to make large profits selling books in the traditional way. This is the fundamental reason why companies like Borders go out of business. Today, publishers go to authors who already have established audiences. How crazy is that?
2. Music Industry – The same thing is true for the music industry; the Internet made traditional distribution channels almost completely obsolete.

What does that mean, though? Has there been a decline in the demand for reading material or music? No. The Internet has just made it possible for consumers to demand that these distribution channels change.

Before moving to the next step, take a look at your specific industry and consider how things are changing around you.

Is it similar to what I described above?

Step #2: Recognize great opportunity

Of course, if you want to be a successful entrepreneur you can’t simply recognize that change is happening. People recognize this sort of thing all the time.

The next step is to actually recognize a great opportunity that you have the ability to capitalize on.

I’ve touched on what makes a good business idea before. What I would consider a “great opportunity” is very similar.

1. Opportunity to provide a lot of value to a lot of people – If you want to be a successful entrepreneur, you need to have something that a lot of people want but not too many people can deliver. There needs to be an opportunity to provide a lot of value to a lot of people.
2. Opportunity to scale – Likewise, a great opportunity presents the opportunity to scale the solution you are considering. In other words, how much demand is there for your solution? To figure this out, try walking through this simple market research process I outlined for my friends over at Under30CEO.
3. Opportunity to make a profit – In most scenarios, if you have something that a lot of people want but not too many people can deliver, you will make money. However, that’s not always the case. If you have the cure for cancer but it cost people a trillion dollars, they’re not going to buy it. A great opportunity presents an opportunity to make a lot of money.
4. Minimizes risks – Entrepreneurs tend to optimistically play off risk as if it won’t happen to them. Guess what? That decision comes back to bite them. In the 20th century, a record number of businesses will launch and a record number of businesses will fail. Successful entrepreneurs will lay out a plan to minimize risks associated with their ventures and will only take on risks within their comfort zone.
5. Is within reach – I have a lot of great ideas. The problem is, I don’t have the means to make a lot of those ideas happen. A great opportunity is one that is actually within your reach. Successful entrepreneurs don’t chase opportunities that they can’t make happen. Instead, they build their power from the ground up; building momentum with smaller ideas.

Step #3: Launch lean

A while back, I was really considering a project that would have required a lot of upfront development cost.

Luckily for me, a friend of mine (who has a lot of experience managing technology development) was able to convince me to find a way to test my idea before I poured a lot of money into it.

It’s a good thing because the project would have likely flopped.

When it comes to the topic of “launching lean“, I like to refer people to Eric Ries’ lean methodologies.

Whether you’re an author, musician, or business owner, the main idea here is simple; get at least a basic version of your product out there so you can start to collect feedback from your customers.

Successful entrepreneurs know that post-launch is much more useful than pre-launch assumptions.

Step #4: Build a relationship with your audience

I can’t think of many instances where a successful entrepreneur doesn’t have a relationship with their audience.

Once you’ve launched a basic version of your product, you need to make sure that you are growing your audience base and building meaningful relationships with those impacted by your product.

The reason for this is simple; you want to learn from them and use that knowledge to help them even more.

In my experience, before you can build a relationship with someone you need to be able to accomplish these three basic things:

1. Make the connection – Find some way to get in front of the person you are trying to reach.
2. Develop context – Find a way to break the ice with the person you are trying to reach.
3. Learn from them – Find ways to gain meaningful insight from interaction with them.

Of course, if you’re starting a business with no money, it can be incredibly difficult to even accomplish these simple tasks.

While you can approach this systematically, you can’t automate the process. Building business relationships requires human interaction.

There are quite a few different ways to do this. Here is a systematic approach I’ve used in the past to make connections with people and, in a very human way, build context and with them.

Start by using a free tool like AutoTweeting to make connections with people.

Remember, the idea here is to NOT automate or spam people but rather to simply find like-minded people and build a relationship with them. To help with this, go into the dashboard and set the software to find relevant users by related keywords.

As you can see from the screenshot above, a small percentage of the people you follow will follow you back. Many of these followers have likely automated the follow-back process with some type of software.

However, if what you are offering is incredibly valuable, a small percentage of your followers will say something nice about it. This is a great opportunity to build context and learn from them.

For example, if someone takes the time to say something nice about The Poised, I make it a point to reach out to them in private and tell them thank you. Then I ask them things like “what are some business challenges you face” or “what kind of content would you find useful“.

In almost every instance, people message me back with a detailed list of stuff they’d like me to write about. As you can imagine, this is incredibly valuable information and presents a great opportunity to start building a mutually beneficial relationship with that person.

Step #5:  Evolve your business idea

As the example above illustrates, there are plenty of ways to systematically gain insight and feedback in a humanized way.

Great entrepreneurs are those who can not only gather useful insight but can also apply that insight to create a better product or service.

They take their new found insight and lay out a realistic plan to make progress towards their next goals. From there, the process repeats.

Successful entrepreneurs make good things happen

What to know how to be a successful entrepreneur?

Develop your ability to make good things happen.

In other words, being a successful entrepreneur isn’t about getting lucky; it’s about creating a smart strategy and then executing it perfectly.

If need be, talented entrepreneurs could completely start over and become successful again. That’s because they have developed a talent.

…a talent that takes them all the way to the bank.