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Sunday, February 10, 2008

Business Acumen or Dumb Luck?

I am reading a terrific book now called, The Illusions of Entrepreneurship, by Scott Shane. I started it, and it has already inspired me to write this post. Rather than give advice that is based on anecdotal information, the author uses data to illustrate the differences that lead to success vs failure for a start-up. Here are some:

  1. Stay in school: college grads do better that high-school grads. Education I have-a-plenty.
  2. Don't start to soon: people who work for others, and learn on their employer's dimes, do better when they ultimately do go on their own and start-up. I did that.
  3. Money matters: Having access to capital early on makes a huge difference. I had significant savings which I used a collateral to get loans.
  4. Have a business plan. I did that, only I did not realize that I had.
  5. Choose the right industry: urology is pretty good, infertility is even better. For me, pure dumb luck! In New York, a start-up OB would be almost doomed to fail. Derm is good!
  6. Have the right motivation: are you doing it to make money or to have autonomy to "do what you want." If you goal is to generate revenue, you'll do what it takes--like answer the phones 24/7 or have evening and Saturday hours. I did those things because they seemed obvious to me. If your goal is to be able to take a vacation whenever you want, re-think your plan.
  7. Buy someone else's business: I did not do this, but I guess you can't argue with the logic.
  8. Focus on your strengths. I did this. Dumb luck.
  9. Marketing: Successful entrepreneurs market their products or businesses early on. Caveat, do it smartly. I wasted a lot of money in my initial attempts.
  10. Find unreached customers: I suppose that had I stayed in the same area as my former employers and tried to compete with them, I'd have lost. Dumb luck and restrictive covenant to thank here. If you are starting your own practice, try to identify patients that others are not seeing, such as patients who need weekend or evening hours or patients of certain ethnicities, disease states, insurance types, etc.
I'll keep you posted about others.

Thanks,

The IU.