Are you a creator or an entrepreneur?

After building over 100 digital businesses, I have seen some succeed and most fail. Why do they fail? In my experience, it's about truly knowing yourself and the path ahead.

Note; This is my first newsletter and you’ve received it because you have signed up to my newsletter at an earlier stage. If you would prefer not to receive these, please unsubscribe below. It won’t hurt my feelings.

A creator can often spot interesting challenges. I certainly did. In 2012, I built an app called Spots that would allow you to follow locations rather than people on Instagram. It gained some traction but enviably died. You can no doubt guess the reasons why it failed.

An entrepreneur can often spot if a new business or product might be successful. I had the opportunity to work with Kevin and Dave from Butternut Box and build the first version of the digital product. They recently raised a funding round of $350m and continue to grow.

In my opinion, a creator is like a chef. They care intimately about the dish they are creating. It’s an experience to be enjoyed. An entrepreneur works with that chef to understand if a restaurant is viable. The location, the ingredients, the salaries. They also need to see past the single restaurant through to the potential of scaling across multiple locations of even franchising.

A creator and entrepreneur are often confused in my experience. After building hundreds of digital products, I believe that the marriage between a creator and entrepreneur is an unstoppable force. Lets take a look at the following stages of a business…

First, The Soup 🍜

I compare the initial product idea to a cooking recipe. Your idea comprises of different features or ingredients. Discovering if you are missing an ingredient or if you have the incorrect proportion of the ingredients is vital. The goal is to get your recipe right.

At the start, the creator is in your kitchen experimenting. They are cooking different possible combinations and taste testing. After lots of taste testing, your taste buds are all out of whack from the sheer volume of soup you're consuming! This is why it is essential to taste test your recipe on honest people. They need to be able to tell if you if there is too much salt, too much tomato etc. This is often referred to as "product validation".

The Restaurant 👩‍🍳

Now that you have validated your product/soup, it's time to open a restaurant. A big step that brings with it a slue of new challenges. Customer service, hiring, finances and customer retention all come into the mix.

Remember, you know you have the recipe for a great soup! Do not forget this and focus your attention on opening a great restaurant. You must refine your operations, work to build a great culture with your staff and ensure your customers have a wonderful experience.

Easier said than done right? I have seen the process of refining a single store take 12 months and more. Much like the soup, getting the restaurant recipe right and documenting the internal processes for an optimised restaurant is key. 🔑

The Franchise

You have a fantastic soup that is being sold in a wonderful restaurant, what's next? Well, it's time to duplicate the restaurant across multiple locations.

It is at this point that I believe that venture capital provides the most value. You have proven that customers enjoy the soup and the experience. They continually come back. The barrier is the finances required to open more locations nearby similar customers.

When you think about it, raising money at The Soup stage can often lead to a lot of problems. You end up giving up too much equity, it's extremely risky and more often than not, there is no need to raise money at that stage at all. A home kitchen, some local store ingredients and passion can get you a lot further than the cash will.

Thanks for reading,
Brian