Doomed to Fail
Even those who are unfamiliar with business may know the old adage that coffee shops are “doomed to fail.”
Trevor Corlett, owner of Madcap of Coffee Company in downtown Grand Rapids, suggests that many people who open coffee shops do so under the false perception that there is nothing to it.
“They spend a lot of time hanging out in coffee shops and it’s super chill and it’s fun and they drink coffee and hang out with friends, and they perceive that is what it will be like to own one,” Corlett said. “You get people that have no background in managing retail, without being able to manage a staff that tends to be younger and all of the things that come with it. So that failure rate that you see from 10,000 feet up includes that.”
The coffee industry is incredibly diverse. Forbes ranks Starbucks among the world’s 50 most valuable brands. Biggby, an East Lansing born coffee chain, has 182 locations across Michigan, making up 48% of coffee shops across the state. For those who like to keep their spending local, Grand Rapids alone has more than a dozen independently owned coffee shops.
Grand Valley State University professor Dr. Timothy Syfert teaches entrepreneurship at the Seidman College of Business, and explains how these different types of coffee entities serve different functions.
“People go to Starbucks or Biggby for the coffee,” Syfert said. “People go to coffee shops to meet other people–for the community,”
What can entrepreneurs approaching different product markets learn from this? Well, coffee shops are a great example of what every entrepreneur should bear in mind.
“That it is not always about the product or service– it’s about what is around it,” Syfert said. “It’s the thing beyond the product or service that keeps people coming back.”
Believe it or not, most people don’t start off as entrepreneurs. Starting a venture often co-occurs with working and/or going to school. Although it is possible to save enough money to live off of while starting your own business, few people will find themselves in the circumstances to do so. So, if you have the itch to get a brilliant idea for a product or service off the ground, you will likely find yourself in a balancing act between work or school (or both) and your new venture.
There are only so many hours in the day, so how exactly does one do it? What can you expect? What are the challenges and benefits?
Entrepreneur in Residence Matt Larson has plenty of experience with the juggling act of entrepreneurship and working full time.
“At one point, I was working full time teaching at a community college, and I owned a vending company and a book keeping company all at the same time,” Larson said. “I got through it. You set goals… Just know that it is going be a roller coaster ride. Understand that going into it.”
When you are first starting out as an entrepreneur, you may have limited room in your budget for marketing. Fortunately, you don’t need to have a multi million dollar marketing department to create recognition for your brand. You just need to know how to tell your story.
Dr. Kevin Lehnert has taught marketing at Grand Valley State University for six years.
“There’s no easy tool to create brand recognition, but the best thing to do is to understand your story,” Lehnert says.
The literary market is flush with books that aim to inspire entrepreneurs, tell the story of successful startups and let readers in on the secrets of those who made it big. From the practical to the absurd, there’s a lot out there. We have compiled a short list of highly regarded startup literature that would do any entrepreneur, from the beginner to the seasoned, well to have on their shelf.
There are many factors to consider when starting a venture; feasibility, financing, product to market fit. But what about healthy relationships with your business partners? No matter how earth shattering an idea is, a dysfunctional team can kill a winning start up. If your team is committed to digging their heals in and weathering the difficult times that will inevitably arise, your chances at success are infinitely higher.
Joseph Horak is the Director of the Family Owned Business Institute at the Seidmen College of Business at Grand Valley State University and a licensed psychologist.
“There are a lot of challenges to being an entrepreneur,” Horak says. “There is going to be a whole ecosystem of relationships around you that will also present different challenges.”
Conflict between startup team members can arise from unequal time investment, differing work styles and unmanaged expectations. Whatever the root, it is important to address issues as soon as possible.
The business model canvas was first developed by Swiss business theorist Alexander Osterwalder in 2008 and has been widely used in business education ever since. GVSU integrated the canvas into the B.B.A curriculum in 2010, teaching it in Management 330, Management 495 and Business 671.
Using a visual chart, the business model canvas ties together the nine basic building blocks of running a business: value proposition, customer segments, distribution channels, customer relationships, revenue streams, key resources, key activities, key partners and cost structure. How does the business model canvas differ from a business plan? Where a traditional business plan is based on the unchallenged assumption of the success of that plan, the business model canvas operates on hypothesis and testing.
In the past five years, Kickstarter has emerged as a legitimate source of funding for startups and entrepreneurs. While banks or traditional investors are likely going to want to see proof that there will be a large, worthwhile return on their investment (sales or letters of intent) Kickstarter is a place for people with great ideas that may not fit conventional funding models.
What it is:
Graphic recording (also referred to as graphic facilitation or visual note taking) is the rendering of conversation, key points and ideation into images. The end result can be used across multiple mediums to visually communicate what was discussed in an effective way. Why is this beneficial?