We are inundated with a focus on funding businesses at their early conception stage. There are dozens, probably more, online funding mechanisms for raising money for business concepts. There is a television program about pitching a startup idea, the Shark Tank.
I’ve watched the TV show twice and it confirmed what I already know. I put money into four ‘go fund me’ online offers. I’ve never seen a response from any of them even one that only promised an article from a writer who was going to Vietnam to write about it from a business perspective.
What I know from hundreds of people who have come to me with business ideas, from working with several thousand new businesses and from starting at least 50 businesses on my own… that there is no way to predict whether a business will succeed.
New businesses are part of a Darwinian evolution. At the early stages you are looking at a strand of DNA that has changed. There is no way to know what that change will make in the protein it generates, what change that protein will bring about in a cell and certainly no way to know what the cellular changes will mean in survival.
The funding is the least of the issues. I once had a certainty. The local property tax assessor had made a change and increase to everyone’s assessment. There was a complex way to appeal the assessment. I ran an ad in the local newspaper for my business of teaching people how to appeal their assessment. In many cases saving thousands of dollars. No response. Because it took me two weeks to get the business set up and run the ad. The issue was no longer news. In two weeks people had found a way to deal with the problem. Who knew? Maybe someone did.
I’ve already told several stories about my business ventures. My Mongolian penis ring finally was sold by someone else in the gay community where it was a big success.
In another of my businesses, online small currency transactions, I got attacked by Ukrainian hackers before I could design and install cyber-protection. It was costly and diverted too much staff attention to keep me going.
The ingredients in business are too many, varied and unknown to allow for successful predictions. The exceptions are franchises and identical businesses in new locations.