Finding Fortune in Failure: Lessons from My First Startup
Written on
Chapter 1: The Unexpected Blessing of Failure
My initial venture into the startup world revolved around the events sector, encompassing concerts, sporting events, and theater productions. While that first endeavor ultimately crumbled—a tale for another discussion—I now recognize how fortunate I was for it to fail. Had it succeeded, I would have been trapped in a profession I disliked for years.
When I embarked on that journey, I lacked the insight into how various product types dictate distinct business models, which in turn shape the kind of work entrepreneurs must engage in. In simpler terms, I established a business that required me to perform tasks I found unenjoyable and in which I wasn't particularly adept. You can sidestep this pitfall by grasping a fundamental concept in product development that, as a novice entrepreneur, I overlooked: the distinction between expiring and evergreen products.
Section 1.1: Expiring Products vs. Evergreen Products
Let's illustrate this concept with a hypothetical: Imagine you're an ardent BTS fan. This may seem an unusual analogy in a piece about entrepreneurship, but bear with me. When you discover that the K-pop sensation is visiting your city, the excitement is palpable! If you have the means, you're likely to snatch up tickets immediately, knowing that the BTS ARMY is vast and fervent. Delay, and you risk losing your chance or facing inflated resale prices.
This scenario exemplifies an expiring product, where limited availability compels consumers to make a purchase. Now, consider a less prominent act, like American Aquarium—whose popularity I cannot fully gauge. Unlike the BTS concert, their performance isn't sold out. Nevertheless, tickets for this show also represent an expiring product, as the opportunity to see them live will vanish once the concert begins. Even if I have a lukewarm interest in the band, I must decide quickly whether to buy tickets.
In contrast, purchasing a new water bottle doesn't carry the same urgency. Unless my current bottle is damaged, I can delay that purchase. Even if it breaks, I can easily hydrate using a glass. Water bottles, therefore, are evergreen products; there's no pressure to buy them immediately, as they retain their value over time.
Section 1.2: Understanding Product Trade-offs
Recognizing the difference between expiring and evergreen products is crucial for aspiring entrepreneurs, as every business will feature a product that falls into one of these categories. The key question is which type of product is more conducive to building a thriving enterprise.
The reality is that choosing between these two product types isn't about one being superior to the other; rather, each has its own trade-offs that influence customer acquisition strategies. Entrepreneurs should focus on understanding how these distinctions affect their approach to attracting customers, ensuring that their skills align with their business model.
To illustrate this, let's examine my current venture: a podcast where I interview successful tech founders about their journeys. For instance, the founder of Etsy shares insights into building the platform, and similarly for Kickstarter. These interviews are evergreen content; the foundational stories remain relevant regardless of when they are consumed.
In contrast, many sports-related podcasts focus on expiring content—like discussions about a recent game—whose relevance diminishes quickly. This affects listener behavior; if both my podcast and a sports podcast release episodes simultaneously, the sports episode is likely to take precedence due to its time-sensitive nature.
As I seek to grow my podcast audience, the immediate appeal of the sports podcast creates challenges. Without a compelling urgency tied to my content, many subscribers may never engage with my episodes simply because life distracts them.
Chapter 2: The Appeal of Evergreen Products
Reflecting on the earlier examples of concert tickets and water bottles, it's clear that a product with an inherent urgency is more enticing to sell compared to one that allows for delays in purchasing. While I appreciate the advantages of evergreen products, they also present unique business model benefits. For instance, my podcast's evergreen nature means that new listeners can enjoy episodes I recorded years ago, a luxury not afforded to sports podcasts focused on current events.
In the case of a company selling water bottles, if someone doesn't buy today, the opportunity remains available next week, next month, or even next year. This flexibility also applies to entrepreneurs with evergreen products; once you establish a reliable supply and distribution channel, you can take breaks without sacrificing sales.
Conversely, consider a business reliant on expiring products, like a concert venue. If a show starts with unsold tickets, they become worthless. To maintain revenue, continuous product development is essential, creating a relentless cycle of new offerings.
Chapter 3: Aligning Product Type with Personal Strengths
During my initial foray into entrepreneurship, I failed to differentiate between creating evergreen and expiring products. Consequently, I developed a business model centered around expiring products—a choice that didn't align with my strengths. I thrive in environments where I can create once and move on; thus, managing my first startup was a challenging experience, ultimately leading to its downfall.
Not all entrepreneurs share my fortune. I've encountered many who, despite running successful enterprises, find themselves entrenched in work they dislike. To avoid this fate, it's vital to comprehend how varying product types dictate different work dynamics. Neither option is inherently better or worse, but they will resonate differently with you on a personal level.
Do you recognize your strengths and weaknesses? Are you aware of the types of tasks you enjoy or detest? Most critically, will your chosen startup align with the work you'll want to engage in for years to come? If you're uncertain, take the time to clarify these aspects before you find yourself entrenched in a business you dread.
Want more insights about startups and entrepreneurship? Take a (FREE) mini-course with me right now!
