Entrepreneurship is like crack

Shouldn’t entrepreneurs try many different opportunities so if one fails the other ones might make it?  No… and yes.  NO, meaning an entrepreneur should never try more than one opportunity at a time.  Yes, meaning if the opportunity doesn’t pan out quickly move on to the next.  Most of the time diversification is good, like when investing or dating, but the word diversification for entrepreneurs, especially in start-up situations, is deadly.

Here’s why diversification will kill a start-up

• Focusing on more than one thing guarantees mediocrity
  • It’s hard enough to build one really good widget (website, product, content etc.) but try building two at the same time and those widgets are going to be half as good as they would have been if you just picked one.

• Your competition already knows not to diversify
  • The competition is smart, someone over there already knows this lesson to stay focused and has all their resources focused on one widget, and it’s going to be amazing.  You can’t afford to have your competition  be focused and you be spread out.

• You have limited resources
  • Even with focus you’re lucky if you can build a better widget than the 800 pound guerrilla in your space.  It’s a crap shoot because large corporations have lot’s of capital and human resources, you don’t.  But you have passion and creativity on your side and a team willing to work crazy hours to win, so do them a favor and focus them all at 1 goal.

• It’s hard to say NO
  • Opportunities are like kryptonite to entrepreneurs.  It’s against every fiber in our bodies to turn down an opportunity.  It seems counter intuitive and crazy to say no to an opportunity that could deliver piles of cash.  But this is what separates the successful entrepreneurs from the unsuccessful, the ability to say no to tempting but DISTRACTING opportunities.

• Choose wisely, if it fails, choose again
  • So what if your 1 focus isn’t working.  Put a bullet in it and move on to the next one.  It’s called “failing fast”, pick your one focus, give it all you’ve got and if it’s not working kill it and focus on the next one.  But only one at a time!

I leave you with this fact:

A 5 watt light bulb can barely light a closet, but when focused like a laser can burn through steel

And this Chinese proverb

“Try to catch two rabbits at the same time and you will catch none.”

And finally this book, it talks about how In-N-Out rules all other burger fast food chains because they stayed focused on creating the best burger (for less money) while others diversified into breakfast, Teriyaki bowls, tacos etc.

In-N-Out-Burger, a behind-the-counter look at the fast-food chain that breaks all the rules