‘Focus is bad for early stage startups’
‘Focus, focus, focus!’
A quote we often hear in the startup scene. Focus is considered that important, it usually comes in threefold. True, it’s difficult to be successful as an entrepreneur. And conquering one product and market at a time seems just about enough. In my career as entrepreneur and startup coach, I’ve however come to learn that focus can also be bad for business, especially in the early stages. Too early focus is bad, and we should stop advising startups to do so.
During my time as a startup entrepreneur, we for example had too much focus on our target group. We chose a market segment that sounded very interesting on paper, and we stuck to it. When too little users converted to paying customers, we kept focussing on that target group and developed more features for the relevant customer. In the end things didn’t work out and we nearly went bankrupt. Looking back, it would have been better to broaden our perspective and to look at the opportunities of other market segments too.
After my own startup experience I saw the same thing happening to many other startups. I’ve been a (freelance) startup coach and program manager for incubator YES!Delft for six years now. I’ve seen a lot of early stage startups quit, because they couldn’t find the right problem-solution-fit and product-market-fit in time before they ran out of money. This is actually the number one reason startups fail.
Like most startup entrepreneurs, I had a lot of assumptions about my business. And most of them were wrong. A customer is for example not perceiving the problem you’re trying to solve as big as you thought, or your solution is not solving the problem as much as you expected. This however doesn’t necessarily mean that your solution is bad, it might mean you have the wrong focus. Maybe your product solves a different problem than expected. A problem that is urgent in the eyes of a different customer than originally aimed for.
At YES!Delft we’ve figured that great ideas with wrong assumptions can be best prevented with a special program. LaunchLab was designed for early stage startups and innovation teams to validate risky assumptions. In ten weeks time tons of interviews and experiments are conducted. The perfect time to stop focussing for a while, because you might miss a market or customer that is more interesting than the one you had in mind.
First broaden your perspective and find a problem-solution fit, then focus. But don’t focus too soon. Remember the definition of a startup – or at least the one we use from Steve Blank: a startup is searching for a scalable and repeatable business model. If we exist to search, why should we limit ourselves by focusing? Instead we should test our ideas to the max.
Is that kind of freedom easy? Not per se. We see that innovation teams from large organization especially have difficulties with the removal of blinkers out of their current business models and perspectives. But they have to, if they want to dig up the right opportunities.
Entrepreneurs are often stubborn. They believe their ideas are right. A little bit of stubbornness is good, but don’t overestimate. Luckily most of the teams learn to be open. They learn that they should not decide on the focus themselves, but that the customers validation should guide their decisions. And until that moment: F*** focus!