Ben Mappen watched from the sidelines as the Dot-Com Bubble came and went until he graduated from the University of North Carolina in Chapel Hill in 2003. Knowing that there must be some opportunity left in the carnage of Dot-Com failures, he headed west to the promised land of California like so many technology pioneers before him. Armed with a degree in computer science, he did what you might expect: he opened a bar featuring a Korean-fusion menu. After all, entrepreneurs are nothing if not logical, right?
Like many of us, Ben had been infected with the start-up virus that left him with an insatiable need to make stupid mistakes and ignore the sage advice from trusted advisers. “I remember sitting in a meeting discussing the menu when my partner told me he thought the Korean-fusion menu idea wasn’t a good one,” said Ben of the early, pre-failure days of his restaurant. “I was pretty passionate about the concept and I guess my partner just wasn’t forceful enough.”
This leads us to what Ben now refers to as the “Core Hypothesis.”
The Core Hypothesis
The Core Hypothesis is the assumption, or set of assumptions, that must be true in order for a business to succeed. This concept is central to Ben’s new business, Lean Launch Lab (leanlaunchlab.com), a software company based on Alexander Osterwalder’s Business Model Canvas. His tool provides a collaboration environment for entrepreneurs to systematically validate or invalidate critical assumptions about their businesses. Through this process, the team will either arrive on the threshold of the next big thing, or decide they are wasting their time and go back to concentrating on their day jobs.
Start-up companies are based on assumptions. The Business Model Canvas provides a tool for capturing these assumptions in all areas of the business (there are nine of them). Combine this elegant tool with the Lean Launch Lab and you and your fellow entrepreneurs have everything you need to start making smart decisions about your business. Good decisions stem from disciplined experimentation. For example, during his restaurant days Ben could have used this software to test his Core Hypothesis, which was: people will like Korean-fusion menus developed by people with no restaurant experience.
With the lean start-up approach, Ben wouldn’t have spent almost half a million dollars outfitting a bar to test this idea. Instead he could have whipped up a few of the recipes at home and test them out on a few friends. He would have learned that his Core Hypothesis wasn’t true. In fact, people of Korean descent didn’t even like the Korean-fusion food. This would have been good to know…
Start-up companies need the passion of an entrepreneur in order to move forward. Passion and commitment drive everything, but they can lead us down the wrong path when they get in the way of good decision-making. Ben’s commitment to the Korean-fusion cuisine concept was strong because his passion was strong. His passion needed to be counter-balanced with a little objectivity, which just wasn’t there. His passion went unchecked until it was finally squelched by sluggish sales and, ultimately, a failed business.
I don’t know a single successful entrepreneur who hasn’t made a mistake like Ben’s. Entrepreneurs tend to let their passion overwhelm their logic, but the good ones learn from their mistakes. The key is to learn quickly and cheaply – before your passion gets beaten to a pulp.
In some cases, your passion leads you down the wrong path. However, the interesting thing about passion is that it can be pretty easy to redirect, especially when it’s directed to a more promising vision. Think of it as “bridled” vs. “unbridled” passion.
Investors love bridled passion. The evidence is everywhere. Incubators and accelerators are springing up everywhere in an effort to direct entrepreneurial passion towards the most productive activities. These programs provide structure and support to an audience of young entrepreneurs to not only help them succeed, but also to help them fail – quickly and cheaply.
Lessons from people like Ben help reduce the risk for entrepreneurs and investors by directing their passions toward productive activities. And, the tool Ben created helps ensure that the lessons are not only learned but applied.
|About the author||Mike Moyer||@Technori|
|Mike Moyer is the author of Slicing Pie, a book about dividing up equity in early-stage companies. He is an entrepreneur who has started a number of companies including Bananagraphics, a product development and merchandising company, Moondog, an outdoor clothing manufacturing company; Vicarious Communication, Inc, a marketing technology company for the medical industry; Cappex.com, a site that helps students find the right college; College Peas, LLC which provides publications and consulting on college admissions; and Trade Show Samurai, LLC a company that teaches trade show exhibitors how to capture lots and lots of leads. In addition to his experience as an entrepreneur he has held a number of senior-level marketing positions with companies that sell everything from vacuum cleaners to financial data services to motor home chassis to luxury wine.He has taught entrepreneurship at both Northwestern University and the University of Chicago. Mike is the also the author of How to Make Colleges Want You, College Peas and Trade Show Samurai . He has an MS in integrated marketing from Northwestern University and an MBA from the University of Chicago. He lives in Lake Forest, Illinois with his wife, two kids and the Lizard of Oz.|
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