By Paul Morin
As an entrepreneur, you must follow your heart. Analysis is important, but it is overrated.
For those of you who are big into analysis and are going to get upset hearing it referred to as secondary to anything, let me explain. This is kind of like me making an Irish joke — it’s okay, because I’m Irish. Similarly with analysis, I can move it down the priority list a bit and recommend to others that they do so as well, given that analysis has been a major part of my career, particularly in the early stages.
This may further placate the “quant jocks” and analysis devotees who may otherwise be offended: In no way am I saying that you should not do analysis when you are considering which business to pursue! On the contrary, I still think it is very important to develop as strong and accurate as possible an analytical understanding of the business ideas and opportunities you are considering. What I’m saying though, is that the analytical part of the process should come second, not first. Base your potential ideas and opportunities first on what your heart says. Then, bring your mind into the picture to determine whether there may be “gold in them there hills.”
So, if you’re going to follow your heart, you have a few questions to answer. First, what is it in life that really excites you and gets you “fired up?” Make yourself a list. Brainstorm. There are no bad ideas when you’re brainstorming. Make the list with your heart, and then you can come back and use your mind to analyze it later.
Next, if you’ve been wanting to start a business for a while, but just haven’t “gotten around to it,” ask yourself why. What is it that’s holding you back? Is it fear of the unknown? Is it a lack of confidence in your ability to make the business successful? Is it more generally a concern that you’ll “fail” and that will be embarrassing for you? Is it simply that you have not come up with an idea that you think represents a true opportunity? Business idea screening can be complicated if you don’t have a background in that area. Seek help, or use a business idea screening tool to help you work through it.
If lack of time has been your excuse for not starting a business that you’ve been thinking about for a long time, ask yourself this question: When do I expect to have more free time? If you are like most people, the answer will be “never.” The only way to have the time to start a business, or do anything outside the norm of your everyday schedule, is to make that time. No one will make it happen for you. You have to do it. It will require a great deal of discipline and dedication, but if you are following your heart and pursuing a dream, you will find sources of extra energy that you never knew existed. Do yourself a favor and answer this question: What small step can I take right now that will get me moving on the way to my dreams? It doesn’t have to be a big step, just take a step and get the ball rolling.
Okay, so now that you’ve gotten the ball rolling and you’ve decided to follow your heart and your dreams, back to that annoying analytical stuff. Although you will be following your heart first, you’d do yourself a disservice if you didn’t make sure you took all the proper steps to ensure that your business idea is not doomed from the start. When I say doomed, I’m talking about from a profitability perspective. If it never looks like it can make you “real money,” it may be okay as a hobby or a charitable pursuit, but don’t kid yourself into thinking that it’s going to put food on the table for you and your family. In order to get yourself and your business ideas grounded in reality, you’ll want to make sure that you understand how to do a simple break-even analysis, how to calculate and understand profitability and the Income Statement, and once again, how to differentiate between ideas and opportunities. There’s a lot more analysis and “left brain” stuff you can and should do to plan your business and increase its likelihood of success, but the few exercises I just mentioned are the minimum — those you MUST understand and do.
You must first follow your heart, then use your mind and intelligence to determine which of your “heartfelt ideas” makes sense as a business. What sense does it make to have a potentially very profitable business that you’re going to hate? Well, it makes about as much as sense as having a very unprofitable business that you love! There must be a balance.
I look forward to your thoughts and comments!
Paul Morin is the founder of CompanyFounder.com. Morin has worked with various entrepreneurial companies in senior management roles and has led the development, review and selective implementation of several hundred start-up and corporate venture business plans, financial models, and feasibility analyses. You can e-mail him at firstname.lastname@example.org.
Originally published: Sep 24, 2011