This is a direct offshoot of the topic of our previous section; market research. The results you get from your market research will provide you with the numbers.
Ambition and thrilling new ideas can sometimes distract one from the facts. Remember that it is not necessary that an idea has to be executed exactly how it was initially conceived. It is totally fine, in fact it is advised, to make adjustments as your research on the subject and understanding of the market increases.
Bill Gross, the founder of Idea Lab (an incubator that has helped hundreds of startups get off the ground) discovered after conducting some research on around 200 companies that timing makes up for 42% of a business’s success.
Therefore, it is quite possible that the world just isn’t ready for what you have to offer. Maybe if you do the same thing a couple of years later, it will be a lot more successful.
Case Study: z.com Vs. YouTube
Bill Gross talked about an online entertainment website his company started called z.com. This was a lot like YouTube. This was in the year 1999-2000. Around this time, broadband hadn’t become common. The internet being used in the average household did not make watching videos easy. It would take too long to load. Furthermore, and the user also had to install a lot of codecs onto their browser to play a video. That launch was a failure. It didn’t catch on.
In 2005, by the time YouTube launched, the codec problem had been resolved by Adobe and just around this time over 50% of America had moved to broadband. In short, it was timing that played the most important part in YouTube’s success.
The point of giving this above example was to show that business and this world is a very dynamic environment and it is better to accept the facts for what they are rather than hoping for miracles.
In this example the business environment factor that led to the failure of z.com and success of YouTube was technological advancement.
The factors that influence your business might be funding, market saturation, or something else. You have to keep your eyes and ears peeled for any information into the world that you’re stepping into.
How to analyze the Business Environment
It is simple enough:
1. See what your business needs, to be successful; what the market needs to have to host you.
2. Check if the market can offer those things.
The surveys you’ve conducted, data mining and extraction from your competitors’ platforms and the general social environment will provide you the information you need.
In the next two parts of this section we will talk about the economics of opening a business and the government policies you need to consider as well as how to analyze technology (as most businesses now employ technology in some shape or form). So, read on if you are interested in finding out about these factors that very directly constitute a business environment).
This is a direct offshoot of the topic of our previous section; market research. The results you get from your …