Are You Solving A Need, Providing Value, Or Neither?

I wrote this post because I am seeing too many entrepreneurs who are bound to fail just based on their concept alone. A well known statistic is that 90% of all new business fail within the first five years. This statistic applies to all businesses, technical and non-technical, product and service-oriented, sole proprietors and corporations. And, do you know why they all are failing?

Because their idea either does not solve a need or does not provide value to the customer.

Many entrepreneurs start or continue a business for the wrong reasons; to satisfy their craving for income and wealth, to “do what they love” regardless of if there is a need for their product/service, or possibly to become independent and a “business owner” or “entrepreneur”. These might all be purposeful and motivational reasons for starting a business; but these are bound to be unsuccessful if the business idea fails to address the most important reason for success, solving a need or providing value to the customer.

In the image above, it shows an Apple iPod. The iPod solved a particular need that customers had at that time, and provided value to them simultaneously. The iPod allow customers to carry their music around easily in a small form factor and store lots of songs (as opposed to Walkmans, which were big, clunky, and you had to carry cassette tapes to change your music).

If the reasons mentioned above for starting a business happen to align with solving a need or providing value to the customer, then great! If not, the entrepreneur needs to go back and reevaluate why they started the business in the first place.

People are unconcerned about your desire to make it big, strike it rich, provide for your family, or your personal happiness. When it comes to your business, the only thing people are concerned about is: “How will it help them?”, “Will it solve their problems?”, “What’s in it for them?”, “Will it make their life easier?”, “Will it save them money?”, “Will it educate or make them better?”. If your business fails to answer any of these fundamental questions, then your business is in trouble.

To succeed as an entrepreneur, you need to be able to answer these questions with clarity and conviction. The best entrepreneurs are able to surrender their own selfishness (to make money, be self-fulfilled, or be independent) and address the selfishness of others (fill a need or provide value to their customers).