So let's say that you want to found a business. One of the very first questions is what kind
of business do you want to found? Do you want to do a start up or do you want
to do a small business? Now while these are some things that have
some grey area between them, the distinction between them is that a start up is going for
world domination. It's trying to be a big company, a multi-national.
It's set up to absorb millions of dollars in venture capital, it's very ambitious.
Whereas a small business is something which is not meant to scale to thousands of employees
and millions of customers in dozens of countries. It's meant to provide a service to people
in the neighborhood.
The difference between these is that with a start up you have to deal with the stress
of playing in a winner-take-all market, and in going for world domination you have really
no protections against anybody else. It really is completely international competition
where you have to be the best in the world. The stress of running a small business is
though is that you might be trampled by one of these guys who has achieved world domination.
For example, I think that in the next 10 years driverless cars are going to put a lot of
mom and pop businesses out of work. So there's no stress free route.
A small business is not necessarily the path to Nirvana.
It means you probably won't be able to exit the business.
You'll probably have to run it your whole life.
That's fine if that's your choice, but you want to think about this.
There are always trade offs. There's also this third option, you can always
be an employee. There's nothing wrong with that either.
It just might mean that you have slightly lower risk tolerance.
You may not want to go 6 months living on ramen without a salary.
You might want a 401k. There's nothing wrong with that.
So think about your options and think about what you really want to do.
Do you really want to do something that is a global, winner-take-all business.
If so, you're ready for a start up. But now let's talk about next, whether or
not your business idea could be a start up.