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Secrecy and echo chambers are where great ideas go to die. For entrepreneurial doctors entering the world of business for the first time, it can be easy to pick up on common tropes or beliefs and unwittingly apply them to your own venture.
This is exacerbated by the ‘unicorn’ culture that seems to still be extolled even when stories like We Work are quickly becoming fables that entrepreneurs and investors alike should be learning from. Not familiar with the story? Read more here and here.1,2,3
Now every other new startup seems to be valuation driven – “I want to get to a billion in sales in 12 months” – rather than value driven – “My customers are going to get the best experience and service as soon as possible”.
The long term impact of this attitude is clear, focusing on valuation rather than value bloats a company’s financial ego and sets it up for an almighty crash once customers realise the system is built for investors, not them and their hard earned cash.
Entrepreneurial Doctors Are Not The Next Uber
Similar to the ‘overnight success’ story, there is the business ideal of companies gestating for months or even years in secrecy, with NDAs being signed at every step before the big official launch.4
The idea being that interest and hype are ratcheted up to the point that there will be a lengthy queue of customers just waiting to engage with your brand and hand over their money.
Except more often than not (read: in ~90% of cases), there is a small puff of smoke or a complete flop.5
I have worked with several healthcare startups and entrepreneurial doctors who have asked for consultation and advice. Even before there was a proof of concept, the first batch of customers or a complete outline of the business mission and purpose, NDAs were flying around the office.
The vast majority of NDAs were for standard or non-unique aspects of the business, but they were guarded like the holy grail. I often wondered if someone broke any of the numerous NDAs if these companies-in-infancy had the resources, time or funds to then see the NDAs fought out in court.
Unless you are in an especially competitive market with highly agile competitors no one is coming to steal your idea. What people want is some person or process who can turn the idea into a profitable reality -and that is much harder to steal than a thought.
I still fail to see the benefit of early legal wranglings unless you are sitting on a genuine invention – and NDAs are a glaring symptom of a bigger problem.
Your Fundamentals Are Wrong
I can say this with good confidence as even the most experienced business people miss the woods for the trees at times. It takes a well trained mind to step back from the chaos and look at the big picture often enough to keep the ship steering in the right direction.
When building up a business or service it is all too easy to get disctracted by the stitching on the driver’s seat while in the meantime the wheels are coming off the car.
If you are starting your first business, congratulations. You are also getting the majority of decisions either completely wrong or simply not as good as can be.
This is completely natural and also in your best interest: the faster you fail the faster you will learn how to succeed.
“Ever tried. Ever failed. No matter. Try again. Fail again. Fail better.”
Samuel Beckett – Irish novelist & playwright
So what is the issue?
Too many fledgling entrepreneurs and established business people try to ‘tick all the boxes’ to act like a big corporation. If you act and look like one then maybe half the battle is won?
Secrecy Kills the Medical Entrepreneur
Building your business behind closed doors and in secrecy however is a common mistake and one that is very unlikely to bring you the big launch and eventual unicorn status that many seem to be driving for.
Instead you live in a ‘thought echo chamber’ made for you, by you. Regardless of how objective you think you may be both your strengths and weaknesses will be exaggerated.
The primary issue affecting your growth is feedback, or the complete lack of it.
Companies live and die by customer opinion, regard and feedback. No customers, no business.
“Make a customer, not a sale.”
Katherine Barchetti – Retailer
Unless you have millions in your back pocket to be burning through marketing spend, research and operational costs, running your fledgling business in secrecy and remaining in ‘stealth mode’ is the business equivalent of running around with a blindfold on.
Then comes the big launch day. Half the features of your product or service can be disregarded as unimportant on day one. All the months spent developing those aspects are now wasted, and could have been much better spent improving aspects that your customers actually want and would benefit from in the real world.
So how do you get real customer feedback without wasting time and damaging your reputation with an inferior offering?
Shadow Testing & MVP or Sell before Build
It is absolutely vital that you have done your due diligence before pouring time and money into any new business idea. It is nigh on impossible to do said due diligence without interacting with your market in a meaningful way.
Rather than hiding your ideas away and assuming the world thinks they are as great as you do, shadow testing a minimum viable product (MVP) lets you actually know what people think.
Well done is better than well said.
Benjamin Franklin, Founding Father & Polymath
This is so obvious and necessary but we all fall into the trap of forgetting we are creating and selling to others, not to ourselves.
By thinking of yourself as a guide, advocate and helping hand for your customers it becomes easier to remove yourself from the picture and concentrate on what really matters: delivering quality and value to those that have paid you for it.
By selling your minimum viable product or even selling before the product or service is ready you gain insight into the number one piece of information core to every business the world over:
Are people prepared to pay money for what you are offering?
Minimising Business Risk
We know time is money, but lack of either time or money leads to mistakes, stress and burnout. A worrying trifecta that can push any company on a downward spiral.
Many view market research as the due diligence that will save time and money in the short and long term. Getting data from actual paying customers however is very different from market research.
Sure, people may really like the idea of a product, but when it comes time to hand over cold hard cash their brain will suddenly remember all the other competing interests ready to snatch up attention, time or money.
Whether you are moving out of clinical life or building a business while maintaining clinical hours, no one is in a position to waste their own time and reosurces.
Once you have a base level of registered interest or product pre-orders where money has exchanged hands, then you know you have a market to build for.
Building in a bubble simply delays the course correction that every business experiences until you have much more to lose.
Business, like medicine, is a practical endeavour. Understanding the academia is a world away from dealing with and managing the day to day realities of the work.
Better to start where your business will always be: in the real world, providing value and benefit to those who need it.
References
- Why WeWork went wrong. The Guardian. 2019
- Nair V. Everything that went wrong with WeWork IPO. Medium. 2020
- Platt E, Edgecliffe-Johnson A. WeWork: how the ultimate unicorn lost its billions. Financial Times. Published February 20, 2020.
- Lobel O. NDAs are out of control. Here’s what needs to change. Harvard Business Review. Published online January 30, 2018.
- 2019 small business failure rate: startup statistics by industry. National Business Capital.