I love that I regularly get to talk with new companies. I learn so much and always leave with a better understanding of current and future market trends. What’s also interesting are the statements that raise red flags which have become consistent over the years. There are several clichés that signal a company is heading in the wrong direction based on what their executives say. The most obvious is: Our company will be the next FILL IN BLANK.
When I started in business, CEOs pitched me by saying they would be the next Microsoft, then it was Yahoo, then it was Amazon, then it was eBay, then it was Google. You get the picture. If a company is trying to be the next big thing but focuses on existing market leaders, they’re destined to be left in the dust. By the time said young company raises funds, fully builds its product and enters the market, the large company it was aspiring to be has already moved on.
In the last few years, it’s not the young entrepreneurs who are making these aspirational claims. It’s executives in their 50s and 60s who seem to be more likely to chase after someone else’s success. Age of course doesn’t mean someone would know better, but it feels like they should.
We have a running joke in my home that I shouldn’t be allowed to listen to my friends’ good ideas. Too many of them have been good on the surface, but light on market research and competitive analysis. If a company is being founded purely to chase an existing company’s current offering, it’s likely to fail.
New companies must not strive to be more of what already exists, either in offering or size. Entrepreneurs don’t need to be the smartest people in the room, but it helps to be the most imaginative.
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