The Three Reasons You May Not Succeed

Entrepreneurship is hard. People who attempt it are rarely successful, unfortunately. In the constant quest to simplify entrepreneurship, I've developed a theory about entrepreneurial (or new product) risk; there are only three reasons an new venture will fail, i.e., risks:

1. Production risk - can you actually produce it
2. Demand risk - will people actually buy it
3. Profit risk - can you produce and provide it profitably

Production risk is often spoken of as negligible, which I somewhat agree with (we walked on the MOON), however, I see a lot of hopeful entrepreneurs with huge ideas that they themselves cannot produce given their resources, so it's still a big deal.

Demand is the most nebulous, because there's simply no way to know if people will buy your product until you put it in front of them with the opportunity to actually buy it.

Profit is simple - it's about your ability to put together a team, find a supply chain, produce your product, establish distribution, sell, etc. profitably. That's it!

Here's a visual I made to help remember this / use as a canvas: