Is there a guaranteed formula to follow (as the headline suggests?) Of course not. A quick look at the people who have become successful entrepreneurs shows the paths they took are as unique as they are.
But—and it’s a HUGE but—while their behavior was idiosyncratic, their thinking was not.
A study by Saras D. Sarasvathy of the University of Virginia‘s business school shows that serial entrepreneurs—people who have successfully started two or more companies—all followed the same approach; and if it has worked for them, it may very well work for you.
1. They were very passionate about what they set out to do. If you don’t have desire, you won’t give anything your best efforts.
2. They begin by taking a small step toward their goal. Starting anything new is certainly risky. You don’t want to move too far too fast. Everything you have probably read about entrepreneurs says they love risk, but nothing can be further from the truth.
3. After taking that small step, they stop to see what they have learned.
Maybe they learn their initial goal is still a good one, maybe the market tells them they need to go in another direction, or maybe they learn that they don’t have the desire any more. The point is after taking that first small step, they come to a complete stop and consider everything.
4. Once they understand what they learned, they take another small step and go through the cycle once again.
In other words the “formula” for success is figuring out what you truly want to do. And once you know: Act. Learn. Build. Repeat.
What This Means
Implicit in this formula is that your initial idea is going to morph over time. Initially, Howard Shultz had Italian opera playing as background music at Starbucks. Michael Dell began his company by doing nothing more than assembling IBM personal computer knockoffs. The best entrepreneurs don’t wait until their product or service is perfect. They get it “close enough” and launch. They change whatever it is they have to change as they go.
The key is to get started and follow the Act. Learn. Build approach. So:
They take that small step toward their goal. For example: “I am going to offer the best coffee I possibly can, within a retail environment that replicates as close as possible what someone would experience if they went out for coffee in Italy.”
They stop and pause to see what they have learned from taking that small step. Example: “People love the idea of an upscale coffee shop, but they hate the opera soundtrack. Let’s drop that, and maybe add some oversize comfortable chairs.”
And then they repeat. “Okay, the chairs were a success; what else can we add and what should we take away.”
Act. Learn. Build. Repeat. It is how just about every successful company we know about was built.