By Meng Weng Wong, social engineer and co-founder at JFDI.Asia, a Singapore-based startup accelerator. A version of this article was first published here.
Statistically speaking, most people are extremely unlikely to build a successful business.
But if you’re going to fail, at least fail for the right reason (you had a good idea that people just didn’t want very much) and not the wrong reasons (some predictable, preventable mistake killed the company).
It takes most entrepreneurs a few years to realize just how hard it is to start a new business – at least, one that pays them as much salary as a big company would.
Why is that? Consider that most people in our society don’t grow all their own vegetables, don’t cook all their own meals, don’t sew all their own clothes. Some people do, but they’re a tiny fraction of the population. Professional, full-time farmers, chefs, and tailors might be able to. But it takes years of training to acquire those skills.
Most people in our society, when they reach a certain age, encounter a problem: if they don’t have a job, then they have more time than money. Big companies are machines designed to solve that problem. So people give the company X hours every month, and the company gives them Y dollars back. It takes hundreds, sometimes thousands of people working together to run those immensely complicated machines.
Entrepreneurs are that special breed of crazy people who accept the challenge of building a new machine. Not just a new machine, but a new kind of machine, one that the world has never seen before – that will pay not just a monthly wage, but an entire lifetime’s worth of wages, packed into a few short years.
Freelancers have already started that journey. The next step for a freelancer is to create a structure which pays you even when you’re not working – that’s the difference between a service and a product business. If the structure can pay others too, then you’re not a freelancer any more; you’re a founder!
Product development vs business development
We assume you’re already good at building products. In a startup, product-development skills are absolutely necessary. But they are not sufficient. A startup is a business, a company, an organization. And most product developers have only ever worked in a business; they have never worked on a business.
What developers do with products, entrepreneurs do with businesses. Fortunately, you already have the mental framework needed to build a business, because both businesses and software are just special kinds of machines.
In both kinds of machines, your job is to design and execute processes. Software processes include daemons, servers, one-off scripts, and user interfaces. Business processes include accounting, hiring, selling, fundraising, and product iteration. We teach you to zoom out and do in business what you already do in software.
Eventually these domains may converge – that’s what “Business Process Automation” is all about – but that is a longer discussion for another time.
At JFDI, we teach learning by living through it. Many people have said that you learn as much at an accelerator as you do at business school. Figuring out business is a lot like figuring out the subway system in a different country where you don’t speak the language: it really helps to have a bilingual friend show you the ropes.
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