Recently, Dallas Maverick owner and Shark Tank investor Mark Cuban commented that he sees an impending tech bubble that could be worse than 2000/1’s collapse. His reason for this potential collapse is based on the assumption that many of today’s tech investors are private individuals rather than the deeper-pocketed professional investor.
Cuban is certain that most of these private investors’ investments in tech companies are worth less than what they paid, and with a nonexistent small tech IPO market they have no way of exiting their investments. But what really underlies the bubble is the same problem that created the ideal environment for the last tech meltdown: a blind rush to throw money at any entity that claims to have created the next big “digital thing” without foundation or proof of concept.
Regardless of what happens with the fickle trends in the world of tech, entrepreneurial opportunities are still plentiful. But sometimes instead of getting in line with the crowd, it’s best to take a different path and look to the past to see your future.
An Answer Seeking a Problem
Entrepreneurial success does not depend on technology, apps, or the latest hot trends. Creating a successful business starts with a simple premise: identify a need or problem and develop a profitable business around solving the problem or satisfying the need. That is it! Success becomes difficult if we reverse the premise by seeking problems for our answers. This, I find, is the issue with today’s entrepreneurial dreamers, who first decide that technology is the answer, because it is “hot” and “buzz worthy” and then must now define or find a problem it will solve.
Now, lest you think I am a stuck-in-the-past technology resistor, I am a mentor for a tech startup accelerator organization and I am witness to some really innovative ideas that are based around apps. But I also counsel well-meaning would-be entrepreneurs who are heading for disaster because they are clueless about the most basic requirement of a successful business – it must actually make money. And the only surefire way to make money is when customers buy your product or service, over and over again.
Technology Must Be a Useful Art
Unquestionably, technology is a huge influence on how we do business but at the core there must be a human need fulfilled for a business idea to be viable. My suggestion is use one of the human needs of sustenance, acceptance, recreation, and domicile as your foundation and study the historical demand for a product or service that meets these needs.
Once you identify the appropriate need in which to build a business, THEN determine how to utilize technology to make the customer experience superior. And remember this about technology—no matter how digital our world becomes, humans can only processes analog signals and still have to eat, drink, have a domicile, and personal relationships with family and friends. Let’s face it, there are tens of thousands of entrepreneurial opportunities that will satisfy one of those basic needs and are not dependent on an app to be successful.
Beer, Booze, and Grilled Cheese
Success with old school ideas and business models is plentiful. In Tampa, Fla., where I live and in many other cities, there has been an explosion of small craft brewers. Beer has been brewed since the fifth millennium B.C. and therefore would hardly be considered cutting-edge technology. Yet entrepreneurs have embraced the risk of taking on the mega-brewers such as Miller and Budweiser not with mobile apps but yeast, hops, grains, and water and are making a huge impact. We are seeing the same with distilled spirits such as bourbon, vodka, and even good old-fashioned moonshine. And the explosion of food trucks on our streets has its lineage with the chuck wagon of the Old West and with pushcarts, which served our pre-automobile urban brethren.
Old Cigar Factories and the Proper Use of a Bulldozer
As we become more conscience of the impact that development has on our green spaces and sensitive lands, it becomes clear that the next big migration will be away from the suburbs and reclamation of the city. New urbanism is an idea as old as the village square yet presents an opportunity to reclaim blighted city neighborhoods and profit from this growing trend.
Scattered around Tampa are the most gorgeous examples of early 20th century architecture and a symbol of its glorious past, boarded-up cigar factories. Risk-embracing entrepreneurs, with the help of local redevelopment concessions, are transforming these shuttered factories into career college campuses, breweries, and office condos.
My wife and I are building a new home right in the heart of an old neighborhood. While my first choice would be to renovate an old Victorian home, as my parents did when I was growing up, Tampa’s options were limited so we tore down a rather depilated house and replaced it with a new one. Instantly we have benefited, as has the entire neighborhood, by transforming something that was of little value into an appreciating asset. All around us there are opportunistic entrepreneurs doing exactly the same thing, except with multiple properties and building successful businesses.
Somewhere along my journey toward entrepreneurial success I was told, “When everyone is leaving town, that’s when you need to be going to town.” While the literal interpretation is actually playing out for me, the underlying meaning is to not follow the crowd like a lemming. Success comes to those courageous enough to find opportunity, independent of trends, which fulfill a historical need or problem. As entrepreneurs we must resist the temptation to follow the crowd and instead create a different, personal expression of our own entrepreneurship.
