I believe that there are two different mindsets as to why someone starts a business – Opportunists, and Problem Solvers.
Both have their reasons for starting a business, and both do see a larger opportunity as a whole; in the end that’s why they are starting a business. However, both have very different mindsets when it comes to their mission and how they receive advice.
Opportunists start a business because they see a large market opportunity. These are the types who can say “There’s x number of people doing y, which represents a total market of z, and if I can come in with a better solution and charge q, then I can get v% of the market and make $$$$”.
Their reasons for starting a business are an opportunity to make money. They see a large market, they have a way to penetrate that market, and such, they start a business in hopes they have found the segment they would like to go after.
Problem Solvers –
Problem Solvers start a business because they have experienced a problem that they can solve for others. Problem Solvers are the people who say “I spent my life experiencing a specific pain point, I now have a solution for that pain point, and I can charge people money for that solution.”
Their reasons for starting a business are primarily motivated by passion. They see a problem, have a way to solve it, and such they start a business in hopes of creating a solution for others who experience the same problem.
Opportunity Vs. Passion –
This fundamental difference of opportunity vs. passion then has a trickle down effect into the way that someone receives advice. Running a business is very tricky, and everyone will always have advice for you.
Some will say you should charge more money, some will say you should change your revenue model, and some will say you’re going after the wrong market altogether.
The way in which this advice is then understood and implemented will vary drastically depending on if you are speaking with an opportunist or a problem solver.
Reception to Advice –
Opportunists are susceptible to advice. They are continuously open to the “pivot”. These are the types who work very well with VC’s.
Why? Because if a VC comes in and says that you should change your business model to cater to a more profitable demographic of people, an opportunist will most likely do it.
Opportunists are market agnostic. If they see a better opportunity and a better way to make money, they will go after it. If they see a more attractive scale, they will go after it because they aren’t tied to any one specific problem.
I would also say that these are the types who build a business looking for an acquisition. They’re primarily in it for the money.
Problem Solvers however, are those who are firm in their opinions, and will have a hard time changing their business to suit the needs of others.
These are the types that (sometimes) don’t work well with VC’s, because they have a specific problem they want to solve and care less about how much money they will make and how large the market opportunity is.
They are the ones who stay true to the problem they want to solve. Even if they see a better opportunity and a better way to make money, they will stay true to their original mission.
Problem solvers are those who build a business to “change the world.”, and don’t care if VC’s don’t understand that vision.
Opportunists are the ones who have their business taken over by VC’s. Opportunists are the ones who build a business they never intended to because investors told them this was the business they needed to build.
On the other hand, problem solvers are those who might fail to see the larger opportunity as a whole. They are blinded by passion and thus overlook scale and sustainability because they just wanted to solve a problem.
The upsides? Opportunists usually make a lot more money and have larger acquisitions.
Problem solvers change the way that people behave and change the world.
It’s important as an entrepreneur to have a healthy balance between these two perspectives. Identify which type of entrepreneur you are to understand what questions you need to be asking yourself.
If you’re an opportunist, ask yourself “Is this a business that I can be passionate about for the next 5–10 years when struggle sets in?”.
I’ve met countless opportunists who end up running a business that they utterly hate, hoping that through their hard work they will eventually be acquired.
If you’re a problem solver, it’s important to ask yourself the question, “Is this a large enough market opportunity? Can I make this into a sustainable business? and most importantly, can I solve this problem at scale?”.
I’ve met a lot of passionate entrepreneurs who overlook these questions only to end up running a small lifestyle business, unhappy with the growth of their company.
At the end of the day it’s not as black and white as I’ve painted but I do believe that these two mindsets influence how and why we run a business.
It’s important to identify with these roles honestly, and approach business with the questions we might not be asking ourselves. Every successful business requires a healthy balance of the two. Whichever side of the spectrum you stray towards, make sure that you don’t tip the scale too far 🙂
Thoughts? Similar experiences? Let me know in the comments below!