The following post is from an upcoming study by Endeavor’s Center for High-Impact Entrepreneurship (C-HIE) on key success strategies for start-ups. The study is based on interviews with 55 High-Impact Endeavor Entrepreneurs from 11 countries. In honor of Global Entrepreneurship Week, we’re sharing five of our favorite “Rules for Becoming a High-Impact Entrepreneur” from this study, with input from some wise Endeavor friends. The full report will be available soon.
The best business ideas are often right under your nose. When launching a company, instead of searching for a ground-breaking business idea, start with what you know. Entrepreneurs can identify a competitive advantage in an industry and get feedback more quickly if they already know the industry and potential customers. Many leading entrepreneurs have become successful by creating businesses in an area where they have prior experience.
Makeup mogul Bobbi Brown shared her insight on what “start with what you know” means to her.
“I’ve had a lifelong love affair with makeup. When I was a little girl, I used to take my mother’s makeup and paint all of my dolls’ faces, and I even painted the dog’s face! It wasn’t until I was in college trying to figure out what to do with my life that my mother asked me, ‘Pretend it’s your birthday, and if you could do anything you wanted, what would it be?’ I told her I wanted to go to Marshall Field’s and play with makeup. She said, ‘Then you should become a makeup artist.’ And I did. I was frustrated by the lack of flattering makeup options for women. The colors that were available made women look like they had makeup on — so you noticed the makeup before the woman. There was nothing on the market that accentuated a woman’s natural beauty. When I first got into making makeup, I didn’t necessarily want to start a company. I just wanted to make a lipstick that looked like lips, only better. This first lipstick became Brown No. 4 and it was a pinky brown. I realized that not all women like nude shades, so I created nine more lipstick shades inspired by different women I knew. I launched those 10 lip colors at Bergdorf Goodman in 1991—and that was essentially the start of Bobbi Brown Cosmetics.”
Twenty years later Bobbi Brown Cosmetics are sold in 56 countries and 988 stores worldwide. As it turns out, “starting with what she knew” was the key to Bobbi’s success.
Data from Endeavor’s Center for High-Impact Entrepreneurship suggests that most high-impact entrepreneurs “start with what they know.”
Among the best Endeavor Entrepreneurs – those whose companies have grown at an average of 20% or greater over the last three years – 94% started businesses that met three criteria:
1. The business was in a market or industry in which the entrepreneur already had expertise;
2. The business utilized skills that the entrepreneur already had acquired; and,
3. The entrepreneur was close enough to customers that he could engage them very early and often.
Hairdresser turned High-Impact Entrepreneur by starting with what she already knew, hair.
When Heloísa Helena Assis recognized that women with curly hair (like herself) did not have access to quality hair care products in Brazil, she decided to draw on her experience as a hairdresser to develop a patented product that tames and smoothes curly locks. Shortly thereafter Heloísa and her business partners Rogério, Leila and Jair opened the first Beleza Natural salon in 1993. An immediate success, Beleza Natural quickly grew into 26 franchised salons in Rio de Janeiro and São Paulo, which today employ over 1,000 people. Each franchise serves up to 1,000 customers per day, processing up to forty clients at a time through their seven-step process. Clearly, because she herself was the target customer for Beleza Natural’s first product, Heloísa was able to develop a product that would serve customers needs for years to come and provide the basis for Beleza Natural’s success.