Founders are never short on opportunities. For the most part, however, opportunities are red herrings. The ones I’m talking about are those that arise after you’ve started building product.
‘We’re looking at a couple of different opportunities’.
This statement by a founder triggers a red flag in my mind. And if the founder’s follow-on statement describing the opportunity is loosely defined, we start moving into DEFCON territory.
The reason I react this way is that every moment spent exploring ideas is time you’ll never get back and runway you can’t recover.
It’s always all about time.
It’s easy for bystanders to urge focus but any founder will tell you that such a statement is easier said than done.
Entrepreneurship by definition requires exploration and discovery. Each day is chaotic and uncertain. Ironically, this is compounded by the nearly continuous flow of opinions from people closest to the founder; spouse, parents, friends, co-founders, advisors, mentors, customers, users, investors and channel partners.
Not surprisingly, founders usually want to process and apply each person’s feedback.
And while it’s true that an entrepreneur’s secret weapon is the speed at which they adjust and execute on massive opportunities, there is an all too familiar reason why many founders end up spreading themselves too thin and running down dark rabbit holes just to be greeted by a dead end.
The Need To Be Desired
Desirability is at the heart of why opportunities are instinctively appealing.
The need to feel wanted is human. And when you’re building a venture and fatigued after prolonged periods of uncertainty and resource constraint, the smallest signal that your product has piqued someone’s interest can be deeply appealing, if not intoxicating.
As ventures develop their notoriety, these signals increase and it becomes difficult to make decisions on which feedback are signals and which are noise.
The main message here is to be very aware that the need to be desired can be a distraction.
The other reality that can compound this issue relates to strategy.
Early stage startups usually don’t have strategies, they have pitch decks. Each version of a pitch deck is an approach that will be subject to continuous iteration based on the signals that founders receive.
Speaking from experience this combination of signals, noise, and strategy (or lack thereof) can have founders scratching their heads about which opportunity to pursue and which to kill.
It’s all about T.T.I.M.E.E.
It’s always about time. See what I did there :)
This is the acronym for the six questions I always ask founders (and myself!) each time an opportunity presents. They carry equal weight and there’s a good reason why these are closed questions (i.e. Yes or No only). The T.T.I.M.E.E. framework is specifically designed to assess an opportunity as quickly as possible. As such, each question should be answered quickly and honestly.
My general rule is if YES is the answer for at least four of these six questions, consider it an opportunity.
1. Time – T
Will it help someone regularly reclaim time? This is a proxy for habitual use and if an opportunity isn’t likely to regularly save someone time (and therefore convenience), it’s not likely to work.
Take inkl, the venture I’m helping to grow, as an example. We’ve built features and engagement strategies around helping people save time each day as they understand the essential news from a diverse array of the world’s highest quality publishers. Gone are the days of jumping from website to website trying to get across the news. It certainly helps explain why inkl is used by people in more than 180 countries.
2. Testing – T
Can you be testing the idea or opportunity within a week? Answering YES means your team has developed a culture of rapid experimentation. It doesn’t mean you have all the answers on the specifics of how you’ll test. It just means you’ll find a way to start within seven days.
If the answer is NO, it could be that the opportunity is too complex but it’s more likely to be a cultural issue as most founders find ways to break down and test the component parts of an opportunity.
3. Idea History – I
Are there at least three examples that show how this opportunity has been pursued? Ultimately the answer to this is YES, if like me you believe there’s no such thing as an original idea. Whether successful or a failure, there is always something to learn. Answering NO just means the person doesn’t know how to use Google in which case this might help.
4. Market – M
Do you have experience or unique insight about the market within which the opportunity lives?If NO, can you acquire that insight in the coming week? If not, the answer to this question is a definite NO.
5. Experience – E
Is the experience you need to create to nail a pain-point crystal clear? In other words, do you understand the pain-point? This is one of the trickier questions to answer because it requires the suspension of personal biases. Where you can, look to data to support the answer.
6. Economics – E
Is the unit economics for this opportunity known or easily determined? Answering YES means that you know how much you’ll earn, what it will cost and the time period over which you expect this to take place.
Answering NO significantly increases the chances of time and resources being burned up. I don’t like giving people a free pass on this question but if it seems overwhelming ask if ‘the path to the first dollar of revenue is clear’, and go from there.
But Is It B2B or B2C?
One factor that often complicates how people assess opportunities is whether the opportunity is business-to-business (B2B) or business-to-consumer (B2C). I’m also surprised about how often it’s ignored altogether!
B2B sales and business development often have a higher per unit payoff but take longer to execute and involve negotiating a complex network of stakeholders. In contrast, B2C products and services usually, but not always, have the opposite characteristics.
Although the B2C / B2B trade-off is important, start with T.T.I.M.E.E. and stop being paralysed by every opportunity that comes knocking.
If you learned something new, let me know by leaving a comment below. Thanks!