“The 5 Principles of Entrepreneurship” (Wiser Next Week: On Entrepreneurship)

"The 5 Principles of Entrepreneurship" (Wiser Next Week: On Entrepreneurship)

About the Wiser Next Week Series: These entries will involve posting my book, Wiser Next Week, chapter by chapter, freely available to the public. Additionally, I’ll be recounting a story about something I’ve learned based on the chapter’s topic since the months that have past when the book was published in December 2018.


A Poorly Thought Out Business Plan

When I was just about to graduate college, I had the idea of starting an ecommerce store. I was going to sell men’s clothing. Not just any men’s clothing though, I was going to have a custom shirt design.

I noticed that in men’s dress shirts, between the buttons in the placket sometimes you can see past it. So I created a custom shirt design that had a hidden zipper in the placket.

My ‘brilliant’ business idea from a few years ago.

I had everything set up:

  • I had a up and running Shopify website
  • A supplentary blog about menswear to establish myself as an authority (here is one such article)
  • A photographer to help me take nice pictures as the product images (I was the model)
  • A contact in China that would help me in the production of the shirts.
  • A lot of free time on my hands to make it happen

The one thing that was missing was demand. I ran a couple hundred dollars worth of Google Ads to drive traffic to the sales page. Product wasn’t ready to be sold yet, so I put up an email signup option on the sales page.

Out of the few hundred dollars worth of ads, I got 1 email signup. It was at that point that all the facts pointed to there being no demand. And I decided to move on to something else.

Two famous entrepreneurs Gary V and Tim Ferriss talk shop about entrepreneurship

The 5 Principles of Entrepreneurship

Based on MJ DeMarco’s book Millionaire Fastlane, normally with any business, there are a few principles it needs to adhere to in order to be successful:

  1. Need: People want what you offer (No one wanted the shirts I was making)
  2. Entry: Not everyone can start your kind of business (It doesn’t take a rocket scientist to open a Shopify store)
  3. Control: You control the unit price and sales volume mechanisms that directly affect your income (This was completely up to me)
  4. Scale: You can reach an increasingly large customer base (The internet reaches billions of people so this base is covered)
  5. Time: Your physical presence is not needed after everything is set up (Besides some basic maintenance this is mostly true.)

Striking out on 2 of these 5 principles lent to my business idea being a non viable option. Eventually I shutdown the website with its corresponding pieces. In hindsight it would have been a lot more time efficient if I had assessed an actual demand for what I was building instead of plowing away at it without considering if anyone wanted it first.

Especially as you get deeper and deeper into a topic you become more invested in its success even when it’s not feasible, which is sunk cost fallacy.

So with any business idea use premortem (the assessment of possible failures) through the lens of these 5 principles to save yourself time.

Here is the “On Entrepreneurship” chapter of Wiser Next Week. Take it and implement it into your own life.


Previous Chapters

“I Didn’t Know How to Do Laundry” Wiser Next Week Intro

“The Spray & Pray Teacher” Wiser Next Week: On Emotions

“Show Them Your Greatness” Wiser Next Week: On Fear

“Psychological Ownership” Wiser Next Week: On Loyalty

“Strategically Smile to Get What You Want” (Wiser Next Week: On Happiness)

“Your Body is a Car” (Wiser Next Week: On Health)

“The Gift of Time and Age”(Wiser Next Week: On Aging & Death)

“Project Your Life 5 Years Ahead” (Wiser Next Week: On Regrets)

“You’re Doing it Wrong” (Wiser Next Week: On Mistakes and Failures)

“Align Principles With Action” (Wiser Next Week: On Goals and Persistence)

Action is Courage (Wiser Next Week: On Persistence)

”See Things As They Are, Not How You Wish Them To Be” (Wiser Next Week: On Perception)

“Grab It By The Reins”(Wiser Next Week: On Opportunities)

“Ask And You Shall Receive”(Wiser Next Week: On Finding Solutions)

“A Part of What You Earn Is Yours to Keep” (Wiser Next Week: On Money)


4 thoughts on ““The 5 Principles of Entrepreneurship” (Wiser Next Week: On Entrepreneurship)

  1. Very interesting story, Kingston!

    My late husband was a quadriplegic (no use of arms and legs) and found that while paraplegics (no use of legs)had sports like wheelchair basketball and recumbent bicycles, there were only spectator sports and movies available for a quadriplegic. In high school, he had played basketball and run a marathon before his accident at age 16, and he missed active recreation.

    He had an idea for a dart game, “Blowdarts” which he developed and marketed. He published an article about it. Like you, he found that there was insufficient demand for his product, but I think he had fun with it!

    I hope you are well. Cheryl

    Like

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