Successful entrepreneurs understand the difference between chasing money and solving problems for customers. That’s because solving important problems is the only way to build a sustainable and scalable business. Most, if not all entrepreneurs nod in agreement when I say this. All deny that they are chasing money, most often followed by a head shake and some version of people that do that are disgusting, aren’t they? They would never do something like that.
Good Intentions Are Not Enough
Sadly the vast majority of service based businesses are in fact chasing money. This doesn’t make them bad or evil. In almost all cases they’re intentions are good. They really do want to help customers solve meaningful problems. They just haven’t done the hard work to figure out what that problem really is. Today I want to share with you 5 signs that you may be chasing money.
#1 It Takes More Than 1 Sentence To Describe The Problem You Solve
Things get interesting when I ask one simple question. What problem do you solve for your customers? It’s especially amusing to ask this question in an online discussion. It should be a simple question to answer and so ingrained into the mind of the entrepreneur that the answer is provided fast and with confidence. Yet I’ve grown accustomed to flashing dots in the message thread showing that the person is typing an answer. The dots stop and start (no doubt words are being edited or deleted). Eventually a long rambling answer appears. Even before I start to read, I know that this person is creating products or services they think people will buy. An entrepreneur that can’t explain the exact problem they are solving in one sentence, or provides a long list of problems they are solving, is actually chasing money. They just don’t see it.
#2 Unrelated Offerings
Another sign is a business that has a virtual smorgasbord of service offerings. Sometimes there is a loose connection between the offerings, other times it’s just a list of services the entrepreneur feels qualified to provide. Diversification is a sound business strategy for a business that is well established and scaling fast. The intent is to mitigate risk and lessen dependence upon a single product or service. However, a diversification strategy only makes sense once you’ve mastered your core offering. A small business that offers a shopping list of services is simply shopping for problems to solve. Find one important problem and prove that you are the go to person for that problem. Fine tuning your expertise and getting the product/solution fit right takes time and a lot of effort. It’s worth it.
#3 Always Trying Something New
How often do we see a business that always seems to be introducing new offerings? This is the classic throw shit against the wall approach, waiting to see what sticks. Again this is often done with great intentions. These businesses invest significant time and energy creating the next great thing that is sure to push their business to the next level. This product development effort is followed by a social media campaign. If things don’t work out, the focus shifts to the funnel or some other element of their online marketing strategy. Sadly, the results are usually far less than hoped for. That’s because they couldn’t explain the problem they were solving or differentiate their solution. Think about it. On any given day you can see hundreds of offers online that all promise to help your business get more qualified leads and increase sales. Some even promise a specific result. I can show you how to take your business to five-figures a month. Really? How? There are any number of variables that would make that unlikely. Which one are you solving?
#4 Tire Kickers
A sure sign of a business that is unwittingly chasing money is an overabundance of tire kickers that never buy. These entrepreneurs can spend countless hours on zoom conversations and proposal writing, with little or no reward for the time invested. If people are not clear on the exact problem you solve, you will likely attract all sorts of people that you can’t really help. Or at a minimum don’t fit your ideal customer profile.
This last one may surprise you. When I see an exhausted and discouraged entrepreneur, more often than not, it means that the entrepreneur has been chasing money without success. When he have absolute clarity on the problem we solve for our customers our entire world as an entrepreneur changes. We attract customers with the problem we want to solve and repel those that are not interested. Working our butt off solving a problem for our customers is motivating and energizing. We get discouraged when we get caught in an endless loop of product development and conversations with tire kickers.
In all five cases the key is to take a step back. Entrepreneurs that have built and scaled sustainable businesses know that drilling down on the exact problem you solve for your customers is hard work. Because it’s hard, a lot of people find it easier to throw things against the wall. Those that put in the work upfront, reap the rewards down the line.
Tim Alison advises and mentors experienced leaders on how to create and scale a business around a unique idea or skill. Tim Also host the globally ranked Screw the Naysayers Podcast. Feel free to reach out at firstname.lastname@example.org