Most answers are on point and definitely explain why fresh entrepreneurs often fail and revert to the steady paycheck.
Entrepreneurship is hard. It eats up a ton of time and requires diverse expertise in a wide set of fields – from starting a business and product/business planning through sales and marketing, customer support and building partnerships, to legal and accounting challenges, hiring, scalability, growth planning.
The list goes on and it doesn’t get any easier.
But it’s just the way it is. It’s hard and successful entrepreneurs are simply putting the time and effort in building a solution that serves the right market.
New entrepreneurs are often fooled by media and the projection of successful entrepreneurs 5–10 years into their successful venture. They often fail to recognize the challenges that entrepreneurs face during the first 2, 3, 5 years of their journey.
Mashable and TechCrunch talk about all the cool startups that came out of nowhere and generated millions within the first 6–12 months. They discuss investments worth hundreds of millions and success stories by unicorn startups.
That represents less than 0.1% of the startup ecosystem.
Everyone else hustles hard and tries to survive. Entrepreneurs max out their credit cards and beg their family and friends for loans. They put in 100 hours a week for months or over a year. They sleep in their parents’ basement, on a couch with friends, or at their office if they really need to rent one.
Whenever they aren’t sleeping, they jump between improving their offering and cold-calling or meeting prospects. They push hard and try to generate some sales as soon as possible.
Even if they manage to do so, it’s usually not enough. It may take over a year to break even while some manage to achieve that in 2–3 years time. Note that revenue doesn’t mean profitability – your expenses may exceed the capital injected by the first clients.
As long as you’ve validated your product-market fit, it’s a matter of blood, sweat and tears. At some point you’ll break even and start generating some revenue. You may be able to afford to hire some folks or apply for an investment.
It won’t get easier but it would extend your lifeline until you really get some traction and become comfortable. Once you get comfortable, it’s likely that a smaller team has come up with something even more brilliant or a BigCorp has decided to enter your space. So you jump back on the drawing board and find out how to beat them as soon as possible.
It’s a constant roller coaster and there are tons of ups and downs. Good entrepreneurs are smart enough and know their market as the palm of their hand. Even with competition breathing down their necks, they can launch a new exciting features, upsell their existing contracts, or find ways to automate their internal workflow for higher efficiency.
Those who are not ready will likely give up in 6–12 months. Everyone else will keep hustling until they finally get enough money in the bank which would let them work hard but more strategically, still trying to keep the growth and expand further.