Majority of the entrepreneurs have learned four big lessons from the dot-com crash that are still relevant in business thinking today :
- Make incremental advances : Grand visions inflated the bubble , so they should not be indulged. Anyone who claims to be able to do something great is suspect, and anyone who wants to change the world should be more humble. Small, incremental steps are the only safe path forward.
2. Stay lean and flexible : All companies must be “lean”, which is code for “unplanned”. You should not know what business will do, planning is arrogant and flexible. Instead you should try things out, “iterate” and treat entrepreneurship as agnostic experimentation.
3. Improve on the competition : Don’t try to create new market prematurely. The only way to know you have a real business is to start with an already existing customer, so you should build your company by improving on recognizable products already offered by successful competitors.
4. Focus on product, not sales : If your product requires advertising, or sales people to sell it, it’s not good enough ; technology is primarily about product development, not distribution. Only sustainable growth is viral growth.
These lessons have become dogma in the start up world. Yet, the opposite principles are probably more correct –
a. It is better to risk boldness than triviality.
b. A bad plan is better than no plan.
c. Competitive markets destroy profits.
d. Sales matters just as product.
To build the next set of companies, we must abandon the dogmas created after the crash. That doesn’ t mean the opposite ideas are automatically true ; you can’t escape the madness of crowd by dogmatically rejecting them. Instead ask yourself, how much of what you know about business is shaped by mistaken reactions to past mistakes ? The most contrarian thing of all is not to oppose the crowd but to think of yourself.
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