Entrepreneur or wanna be?
July 31st, 2008 by Benjamin KuoOne issue I hear about a lot from venture capitalists in town, is the problem of sorting through what I think of as “real” entrepreneurs from “wanna be” entrepeneurs.
“Real” entrepreneurs are those who really have a business model, are fundable, and have the experience and knowledge to make a “real” business.
“Wanna-be” entrepreneurs usually do not have any experience/knowledge, don’t have a business model, probably will never be able to get a venture round, and generally are a waste of time for VCs to deal with.
Some hallmarks of “real” entrepreneurs:
- Have relevant knowledge in the field they’re attacking, usually in some sort of senior/executive role at a related firm. (i.e., starting an Internet ad startup, was a VP at Overture/Google/etc.)
- Have been willing to invest their own money and time into the venture.
- Track record of success bringing prior products to market.
- Are well into implementation of their idea
Some warning flags on “wanna be” entrepreneurs:
- Do not have any relevant experience in the field they are attacking. (i.e. starting Internet ad startup, used to be a insurance salesman)
- Pitching a power point and idea, not a running business.
- No track record of bringing anything, much less a company, to market.
- Have been looking for $ for their idea for 2 years and don’t have anything running yet.
Which one are you?
July 31st, 2008 at 10:14 am
Great job of describing the polarity of entrepreneurs, however is it really this binary?
It’s obvious when you meet a serial entrepreneur who has raised sand hill VC money multiple times and has had big exits. However, the “wannabes” aren’t always as clear cut.
I’ve observed somewhat of a spectrum between the two classes of entrepreneurs, and often meet folks who combine characteristics from both “wanna be” and “real” entrepreneurs. How should we classify those?
July 31st, 2008 at 2:39 pm
All of those points are spot on. The one that has been the best predictor of success for the entrepreneurs I’ve worked with is having experience in the industry.
In addition to providing the background that’s needed to succeed at running the business, it also means the entrepreneur probably has a valuable network of quality contacts.
This shaves years off the time until success.