It’s easy to have a sense of entitlement when we want to “change the world.” We may feel that others should just get on our bandwagon and support our efforts. I know the feeling – I’ve been there more times than I care to admit. Unfortunately, this attitude of entitlement can lead to wasted energy and squandered money.
Don’t let the tax status of your enterprise lead you into misguided efforts. Some basic rules apply regardless of whether your organization is a Benefit Corporation, Subchapter S, 501(c3), 501(c4), Partnership, or other type of organization.
- Need: Is there a glaring need? How do you know? Have you done the research to determine the specific need? Or are you just guessing based on your gut?
- Competition: Is there another entity that is already successfully working on the problem or opportunity? If so, then why are you entering the space? Do you have a superior solution? Or should you be partnering with the existing entity?
- Examples of Success: Is there a non-competitive entity that has successfully implemented a similar business model in another region, industry, population group, etc.? What did they do to be successful? Will it apply to your situation?
- Funding: Is someone willing to pay you to meet the need? Don’t just guess on this — get those first paying clients or that first major donor. There are plenty of people who will politely tell you that “it’s a great idea” and then be unwilling to pony up the money.
- Organizational Capacity: Do you have the capacity (management, funding, contacts, and expertise) to meet the need in a meaningful way? If not, can you acquire them?
- Timing: Is this the right time for what you propose? Are you capable of acting with some sense of urgency? You should be able to quickly achieve something meaningful in order to prove the concept.
- Expansion: If your venture is part of a larger organization, then how does this venture benefit from and contribute to existing capabilities?
I’m sure that there are additional questions that an organization can ask to determine whether its efforts are wishful thinking rather than substance. I look forward to hearing some of them in response to this blog, and will summarize them in a future blog. I particularly want to hear from those of you who’ve learned from your mistakes!