Entrepreneurial Lessons - For Software Startups

Hemant Elhence
Hemant Elhence
Founder and CEO, 
Here are the top eight lessons that I feel all entrepreneurs, especially in the technology space, should heed. These are particularly applicable to software, specifically B2B software, and the service space.

1. Your superb start-up “idea”, or your “IP”, is not enough.
The real crux of building a business is just that - building the business. In building a successful business, relentless execution is far more important than a great idea or superior intellectual property. Many people dream of great ideas all the time, few really do anything with their idea. Chances are many people have already had the great idea, perhaps an even greater idea than yours. While protectable intellectual property (IP) is helpful, it is neither a necessary nor a sufficient condition for creating successful and valuable business. So don’t get obsessed with your idea or your IP itself, rather focus on starting and building the business.

2. You can’t make a start-up happen by working at it part-time.
Most entrepreneurs try to start their venture in a lower-risk manner by keeping their day job, or doing some consulting work on the side (which pays the bills), while they are building their new venture on the side. This usually doesn’t work. When the venture needs it most, your focus and your energy get divided. The real action and progress in building a start-up happens when you make that “yet another” cold call, looking for your first customer, on that dull Friday afternoon, when otherwise you would have been working on your day-job or your bills-paying-consulting-gig.

3. Don’t confuse product based and service based business models.
A product based business requires upfront investment in building the product and building a sales & marketing organization that can sell that product. On the other hand, a service based business requires selling and delivering core capabilities. The two require very different business models. Often you can start with a services business model (offering consulting services to your target market) and then over time, productize your offerings to build a software product. This evolution works quite well and there are plenty of successful software product companies who can trace their start-up roots back to a services business model. But the important thing is to build the product in roughly the same market space or domain in which you are delivering your services. What doesn’t work is when you start out as a services company and then try to add software products that are in a completely different market segment.
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Reader's comments(5)
1: Great insight, very true, a reminder to me on the great ideas I have. Thanks Hemant.
Posted by:Joseph John - 23 Feb, 2012
2: you are on the dot..
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Posted by:allen lynnchillo tom - 28 Dec, 2011
5: Some great tips for starting a startup. I most liked the first point. you 've a great idea but you are not working on it.

Thanks for your suggesstions.
Posted by:ashutosh singh - 28 Mar, 2011

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