I’ve always considered myself a relatively romantic person. Surprising my girlfriend (when I had one) with flowers, secret plans, and notes of good will when the time was right. When it comes to entrepreneurship on the other hand (like business business, not the other kind of business) I am much less romantic. In fact, it bothers me when I see others who take a very romantic view. That doesn’t mean I am any more right, just more bothered.
For example: Loic Le Meur, the founder of Seesmic has a post on TechCrunch for his “10 Rules of Startup Success“. They are all pretty well founded except 7 and 8.
7. Don’t spend time on market research. Launch test versions as early as possible. Keep improving the product in the open.
I mean no disrespect to Loic Le Meur and don’t know how much I can say since really he’s done a lot more than I have, but really? Let’s not spend time on market research? Just throw spaghetti at the wall and see what sticks? That may work for Google who has the resources to pump out prototypes, but to not spend time on market research? I agree with launching early test versions and to continuously improve the product in the open, and I know that 2/3’s of companies significantly reinvent themselves but that’s just lazy. Market research is important because it can deter you from wasting all the resources on an idea that you’ve fallen in love with but ultimately has no market.
8. Don’t obsess over spreadsheet business plans. They are not going to turn out as you predict, in any case.
Don’t obsess, sure. But they’re still important. As the CEO of a company, you still have to have a 3-5 year plan for your company. You still need to have steps planned out, and the process of creating a business plan is a pretty good way of getting everything organized in your head, if only just for your sake, even if it will change. At that rate, why do existing companies do financial projections? It’s not like they’re going to be exactly right anyway.
I realize I am being a bit cynical here, and I think there is a place for both styles of entrepreneurship, romantic and traditional (I suppose). I don’t see the need to really separate the two, though. Use the romance of the idea to get you through the boring spreadsheet business plan parts. You may not stick to the plans, and your market research may not even end up being the market you end up in, but you certainly won’t be worse off for having done either.