Will
Bitcoin ever take off? Who knows. I, for one, am not a big fan of
trying to predict the future. However, one thing we might consider is
whether or not Bitcoin solves a real problem.
Like I said, two weeks ago, I do not know very much about Bitcoin. That
said, we can still have a short discussion. You see, no solution is
perfect. Your aim should never be to create the perfect product. Well, you can shoot for perfection, just know you will never actually reach it.
Anyways, all
economic decision are based upon costs and benefits. We call it a
“Cost-Benefit Analysis.” If the benefits outweigh the costs we
tend to buy.
In
the case of Bitcoin, what is the benefit? From best I can tell, the
benefit of using Bitcoin is the ability to avoid taxation. Listen,
all western countries have established, and efficacious, forms of
currency. So, why do we need a new one? Apparently, since Bitcoin is
not overseen by a government, it is not taxed.
That
strength can also become a profound weakness. The value
of Bitcoin seems to be governed by market forces. Which is fine. But,
as we know, markets are prone to bubbles and bursts. Just think of
the tulip mania that occurred in the Netherlands.
From
what I can tell, Bitcoin is a rather insecure form of currency. So,
those willing to accept the risk will be rewarded by the absence of
taxation. Again, I do not really understand Bitcoin. Whether or not
it succeeds, only time will tell.
And,
that is a key word. Time.
Every
entrepreneur needs to be honest, with him or herself, about whether or
not their solution solves a real problem. A big mistake people make
is they try to guess, in advance, whether people will want their
product.
The
right move is to test your offering. Run a pilot program. In the
parlance of aviation, get something the air and see if it flies.
Time
is critically important in entrepreneurship. That being said, you
want your time spent getting feedback from the marketplace. The goal
should be to spend as little time as possible in the planning and
preparation stages. Instead, run a test. This is the concept of
“rapid-prototyping.”
Get
something out into the market and see if people buy it. The market is
an excellent feedback mechanism. The real challenge is understanding
what the market is trying to say.
Just
because people do not buy your offering does not mean it is no good.
It does not mean your product must fail. The answer might be
adjustment. You might not to tweak your product, your target
customer, your distribution channel, etc. Or, the answer could be
patience.
What we are looking for is proof of concept. If you have ever seen Shark Tank, you have heard about proof of concept. And, what proves your concept might work? In a word: sales.
If
enough people buy your product, you will probably succeed. The key is
to pour the right amount of gas onto that fire (Hint, err on the side
of too much gas rather than not enough.) But, what if they are not
buying? How long do you keep adjusting things until you give up?
Well,
we have now hit upon one of the most difficult questions in all of
entrepreneurship. When do you hold 'em and when do you fold 'em?
Sorry, but I have no simple answers. Nor does any other honest
person. It is a judgment call. And, like most anything, the only way
to get good at making that call is practice.
Unfortunately,
in the real world, practice is often synonymous with failure. The
truth is, the chances of you hitting a home run, on your first
at-bat, are very low. It is much more likely that you will fail.
Perhaps even go bankrupt.
Here
is a moment for you to pause. I want you to ask yourself a couple of
important questions, “Am I willing to lose it all? If I did lose it
all, would I have what it takes to bounce back?” If your answer to
either of those questions is, “No,” entrepreneurship is not for
you.
I
am, most certainly, not being pessimistic. As a matter of fact, I am one of the more
optimistic people you will ever meet. That said, I have also failed
miserably. So, I would not be doing you any favors if I gave you
rose-colored glasses.
You
can succeed, at entrepreneurship, by creating real solutions to real
problems. Just do yourself a favor and get time on your side. Be prepared to fail and try again. And again and again. A key to
success, like Angela Duckworth teaches, is grit. If you do not know Duckworth, read her book, which came out just last month.
If
you just keep iterating you will eventually succeed. The question is,
do you have enough time? No one can answer that question except you.
The paradox is this, can you fail fast enough to succeed? This is the
entrepreneur's journey.
