Quick Summary: Before You Start Up by Pankaj Goyal is a great guide for aspiring entrepreneurs with big dreams. Throughout this book, he talks about what mistakes most entrepreneurs make in their journey.
Who should read Before You Start Up Summary, and why?
The startup world is crazy right now!
At the time, when I'm writing this summary, a lot of businesses have been hit by the pandemic.
Many businesses that were making profits have started to struggle.
Even those who had a well-planned strategy didn't expect such a change.
What does this tell us?
If you want to start a startup, you have to do preparation - a lot of it.
So who should read this book summary?
If you're someone who wants to start a startup (obviously), give this a read.
It's better to read this 10 minute summary than wasting a shit ton of money building a business that people don't care about.
It's painful to watch your business die out there in the competition.
And regret later!
Before You Start Up Summary (PDF)
A startup isn't easy. And it certainly has its upsides and downsides.
Read this summary to learn what you need to do before starting a startup.
Here we go!!
Key Idea #1: Entrepreneurship isn't as cool as it sounds
These days, people think of entrepreneurship as something that can solve all their financial problems and improve their status quo.
Got a boring job? Start a business.
Have a boring life? Start a business and embark on a thrilling journey.
Want to be famous? Become an entrepreneur. You'll get lots of eyeballs.
Want to achieve financial freedom? Become an entrepreneur and become a millionaire.
Although entrepreneurship can help you achieve some of these goals, it's not exactly what people think it is.
Having an epiphany? Read on.
Here is what the author says throughout this book:
Entrepreneurship is like a marathon. And it's a lot more painful than other options.
Maybe you don't need to become an entrepreneur.
For example, if you're stuck in a boring job, maybe you just need to find an interesting one, the author says.
Entrepreneurship isn't for everyone.
In fact, entrepreneurship is highly risky.
What if nobody buys your product?
What if people don't like what you offer?
What if your competitors snag your customers?
What if you suddenly find yourself without cash?
On and on it goes.
The point is not to scare you.
The point here is to let you know the truth:
No matter how cool it sounds, entrepreneurship is a painful struggle.
If you succeed in this game, people will make you feel proud. Everyone will talk about the stories of your success.
And if you fail, which is highly likely, nobody will care.
Getting the point now? Okay.
If you are wondering if this entrepreneurship game is so risky, then why did the author even bother writing this book about starting a startup.
Yes, your doubt is logical. It makes sense.
The author clears this doubt in one of his initial chapters:
He says that he just wanted to prepare the readers and tell them about reality.
That's a good thing, isn't it?
One has to be practical and be aware of the reality.
The author doesn't want you to live in illusion and regret later.
He says that if you prepare well, you can overcome all the challenges that an entrepreneur faces in his journey.
It's like learning the rules before playing a game - for the very first time.
Imagine if you have never played cricket in your life. And then suddenly someone gives you a bat.
On the other side, there is a professional bowler who bowls at 100km/h (random).
What do you think would happen then?
Let's hope you never end up in such a situation.
But does that mean you can never play cricket? Obviously not.
Once you learn the rules and practice a little bit, you can play any game.
Getting better at it is another story, though.
Key Idea #2: Understand why you want to become an entrepreneur
The author says that people may start entrepreneurship for the wrong reasons.
They see the flashy lifestyle of successful entrepreneurs.
And guess what, they decide to pursue entrepreneurship as their career.
Later, they realize that they have made a pretty darn mistake.
They find that they are not prepared for it.
That's the reason this book is for, right?
Since you are reading this summary, you will never make that mistake.
Want to become an entrepreneur? Find out why.
Do you want more money?
Do you want to thrill and adventure in your dull life?
Do you want to help humanity?
What is it you hope to achieve? What is your end goal, huh?
Wondering why is finding your "why" that important?
Here is why:
When you understand your "why," you get a reason that keeps you going. As the journey gets harder and harder, you find yourself coming back to your reason.
When your business goes down, you remember how big of a change it brings to this world.
Not to mention, a strong purpose helps you battle with internal/personal challenges that come as a by-product of entrepreneurship.
For instance, you may get depressed at times. You may feel alone. You may feel weak.
You may think that you are wasting your time while your friends enjoy a vacation on an exotic beach.
As an entrepreneur, your lifestyle will be way different than ordinary people.
Especially in the initial days, you will need the mental strength to stick to your goals.
A lot of things could go wrong in the initial days, right?
But...But .. But.
If you have a strong "why," you'll probably overcome most of these challenges.
Think of finding your "why" as a preparation before a war.
If you know why you are entering in war, your chances you holding your ground and not get killed will be high.
It's crazy, isn't it?
An entrepreneur enters into the realm of uncertainty in the hope of emerging as a winner.
So long story short:
Know your "why." It prepares you for your journey.
Key Idea #3: Learn how to generate business ideas
You are going to start a startup, huh.
What's your big idea?
Can you define your startup in one sentence?
What will you do?
Who will you serve through your startup?
Most entrepreneurs never start a startup because they think that they don't have a big idea that can revolutionize the world.
And it's not their fault.
We grow up hearing the stories of successful people like Bill Gates or Steve Jobs who revolutionized the world with their creative and mind-blowing ideas.
This builds a belief that if you have to run a successful business, you have to have an idea that is new and hasn't been worked on before.
But this is far from the truth.
Just look at Google.
It's isn't the first search engine.
One thing is clear from the example: To make a startup successful, you don't necessarily need a new big idea always.
The author suggests that as an entrepreneur, one should also look at evolutionary ideas.
What's the difference between "revolutionary ideas" and "evolutionary ideas"?
Revolutionary ideas are brand new. While evolutionary ideas are built over existing ideas.
Book Connection: From Steal Like An Artist, I learned that there is no such thing as original; every original thing is a remix of pre-existing things. In short, no ideas is entirely original. Also, in Where Good Ideas Come From, I read that good ideas can't emerge in isolation; they need a quality network to grow and nurture.
How can you generate profitable business ideas?
The best way to do that is to look at your life.
What problems do you face in your day-to-day life?
What do you think could be improved?
What frustrates you? And how can you get rid of that frustration?
These are common questions that can help you generated ideas.
While generating business ideas, you should keep in mind that you've to test them before you start working on them.
You may think that a particular idea is amazing.
And guess what? You start working on it.
That's the fastest way to fail, my friend.
It's possible that maybe (accidentally) it works. But trust me, in today's world, it's SUPER rare.
Almost every idea has already been acted upon.
Thanks to the Internet. People today are already overloaded with ideas.
You have to TEST your ideas before you take any action on them.
The problem with revolutionary ideas is that they aren't tested.
You'll have to spend a lot of time and do hell lot of research to test them. Before you even start thinking of implementing them.
And still, you can't say that your idea would lead to a million-dollar business.
On the flip side, when you have an evolutionary idea, you already know that there is a market.
Evolutionary ideas don't require as much effort as the Revolutionary ones to get tested.
Your job as an entrepreneur gets a little easier when you work on evolutionary ideas. But this also has a downside:
You face MORE competition.
When the first search engine was created, there was no competition.
When the first camera was created, there was no competition.
When the first YouTube channel was created, there was no competition. You could get a crazy number of followers, right?
But today if you create one more YouTube channel, you'll probably found that there are hundreds of others who are doing the same things as you.
And to beat that competition, you'll have to spend more resources.
Either you choose an evolutionary idea or a revolutionary one, your journey will be painful (especially in the initial days).
Technically speaking, every startup goes through different phases.
This is the Ideation and Testing phase we are talking about here.
What if you don't follow any of these tips? What would happen then?
Simple, you'll end up wasting your time.
I can't stress enough how vital these two initial phases are.
It's better that you brainstorm as many ideas as you can in the beginning without holding yourself back. Then test those ideas later.
Don't try to do both the things at the same time!
This will only slow you down.
Don't say "YES" for an idea if your friends or your spouse like it.
You have to make sure that there are enough people out there who believe in your idea.
To make it simple:
Find a burning problem in the market. Then think of an idea that might help find a solution to that problem. Or if your idea is the solution - that's even better.
Sounds easy, right?
Trust me. It's f'ing hard.
Maybe, you find it easy.
But for most people, this can be a hurdle in their entrepreneurial journey.
And if you struggle with this phase, don't worry. You'll find one.
Develop a habit of reading. Which I already encourage my readers to adopt.
When you read a lot, your mind gets fertile enough to produce new ideas.
Talk to experienced people. Interview them.
You'll learn a lot by doing so.
Eventually, you'll find an idea that can be acted upon.
Most people find this phase difficult and therefore try to avoid it. Result? They build the wrong business, which eventually fails.
There are lots of things that we can discuss related to this concept.
But let's just stick to this book's context.
Reminder: Don't forget all the ideas that we discussed above. Like finding your "why." These too help in validating business ideas. Ignoring them can lead to failure.
Pro tip: While you read this summary, realize that there is no such thing as "guaranteed successful idea." Only time can tell how right you are.
Key Idea #4: Evaluate your business ideas the right way
We just discussed it above, though.
Let's dive a bit deeper. And discuss the right approach to evaluate a business idea.
You have to filter the bad ones, right?
Here is the thing:
The worst way of generating a great business idea is assuming that our idea will work.
In fact, it's a perfect recipe for failure.
That's how complete noobs hunt for business ideas.
It's insane. Avoid it!
Then there are people who know a little about ideation.
So they do a couple of Google searches.
Ask a few friends about what they think.
Get excited about it. And boom! They dive into the startup cosmos.
It's good to do research a bit.
But I would suggest you follow the author's approach. It's much better!
According to the author of this book, you should ask yourself these questions to evaluate the business ideas the right way:
- "Can you identify and profitably serve 100 customers?"
- "Can you find the cash?"
- "Can you acquire customers in a sustainable way?"
- "Can you execute your idea?"
- "Does your idea fit into your 'why'"?
I won't go too deep into these questions. You'll probably need to buy this book to learn more.
But I will touch the surface, though.
If not even 100 people benefit from your idea's execution, just drop it.
Also, you'll need cash to run your business. Do you have any business plan to earn enough cash to survive, and compete too?
If not, find one.
Is your idea even practical? It's cool to talk about Elon Musk. And dream of building a spaceship and launching rockets into space.
Do you have enough money to hire those specialized people? How will you pay for them?
Fancy ideas are suitable for dreaming. But startups only work with ideas that can be executed in the real world. Have you evaluated your ideas?
Let me make this clear: I'm not saying that you can't achieve something as big as Elon Musk.
Have you surveyed lots of people and talked to experts related to your target industry?
Forget about all that stuff, is your "why" clear enough?
Do you know why you are doing what you are doing?
See what's happening here?
I'm throwing lots of questions at you.
Because only by questioning yourself and your ideas like this will you be able to evaluate your ideas correctly.
You need to prepare before you put your first step forward.
Remember the first two key ideas? That's awesome.
Key Idea #5: Never choose a wrong co-founder
After you spend some time on your startup, you might feel the need to hire people.
You may try to find your co-founders.
The author says that a startup's team is its heart and soul.
Hiring the right people is incredibly important. As a founder, you should be cautious and strategic about who you hire.
The author realized during his journey that one reason he failed at entrepreneurship was that he chose a wrong co-founder.
Now, the question is:
How to find the right co-founders for your startup/business?
And to get the right answer for it, you must know why you may want one in the first place.
Can't a founder do all the tasks himself?
A founder doing every task in a startup is the culprit behind many startups that didn't reach their full potential and died eventually.
From my experience of running this business as well as what the author has said in this book, I can tell that you will find that 24 hours aren't enough.
You will have to do so much stuff - not necessarily the one you would like to do.
Maybe you don't like doing the technical stuff.
Or maybe you love to geek out on technical aspects of anything.
Also, not all is about a person's interest.
You can't be good at every skill. Why? Because to master any skill, you'll need to spend so much time perfecting the little details.
If your idea is big enough, you'll need to choose your co-founders.
Choose the wrong one, and you're doomed.
The author tells that he chose a wrong co-founder for his business and regrets it.
You can learn from the mistakes that the author made. And make sure you don't make the same mistakes the author did.
What to look for while choosing a co-founder?
The author has talked a lot about this in this book.
I'll share a few key points so that you don't make a mistake and choose the wrong one.
The first thing that you look while choosing a co-founder is:
What value does he add to your startup?
In simple words: what will he do that you can't do or are unwilling to do?
For whatever reasons you're hiring your co-founder (s) for, make sure that he complements what you are already good at.
Another underrated thing that people usually overlook is: whether you can trust the other person or not.
Book Connection: In Clockwork: Design Your Business To Run Itself by Mike Michalowicz, I learned that you have to become a designer of your business and trust your team with the responsibility to do the work for you. Without it, you'll never be able to scale your business.
If your co-founder can't be trusted, it's better to be alone or choose someone else.
And even if you fail to find an appropriate co-founder, don't keep waiting, the author says.
It's crazy, right?
Waiting for the right person to add value to your business!
Let's admit: It's hard to find the right people for your business in one shot.
As you become more experienced, you become good at hiring. But while you do all this, you should be moving forward.
So even in the worst case, you'll progress.
The truth is:
When people see progress, they get attracted to it, the author says.
"People start joining when they see tangible results." ~ Pankaj Goyal
Key Idea #6: Prepare yourself for the mishaps
This book talks a lot about planning before starting.
Let's be real:
As you progress, you may meet failures.
Depending on your investment, the pain due to those failures may vary, right?
If the loss is more, there is more pain associated with it.
In this section, we'll talk about how can an entrepreneur have a contingency plan for his startup.
To run a business or startup sustainably, you need a source of cash. There must be a way to get the cash flowing in.
In the 1-Page Marketing Plan, Allan Dib said that cash is like oxygen to business.
If you are not having profits, your business will fade away eventually.
Ever heard a business story who grew on losses?
Well, if you've got investors, it's a different story. But they will, too, expect returns for their investment.
In short: You need profits.
In any startup, there are ups and downs.
So do you have any plan if the cash starts depleting?
Can your family or friends help you?
You need to be very strategic.
And if you have things planned out and documented, you'll be much better prepared and overcome all the challenges.
The key takeaways from Before You Start Up Summary
- Entrepreneurship isn't as cool as it sounds.
- Understand why you want to become an entrepreneur.
- Learn how to generate good business ideas.
- Evaluate your business ideas in the right way.
- Never choose the wrong co-founder.
- Prepare yourself for the mishaps.
Before You Start Up Review
This book is best if you don't know much about starting a startup.
I'd the say that the book I got had low-quality pages.
Nevertheless, the information provided by the author is gold.
Throughout this book, the author admits that he failed and prepares you so that you don't make the same mistakes the author did during his entrepreneurial journey.
Generally speaking, it's always the best to learn from failure stories.
Because then you don't get distracted by unnecessary distractions. You learn things you should avoid right before you start a startup.
I'm not saying that success stories are not helpful at all.
Think of the last time you heard the success story of an entrepreneur. Now, remember how many YouTube channels and media houses covered that story by adding magnetic elements to it.
Generally, people don't talk about failures and mostly discuss success stories.
Success stories give us hope, right?
But the truth is:
When you study failure stories, you learn more about how not to fail.
Yes, success stories are great to hear and often motivate us to get out of our comfort-zone. But they don't necessarily give you the full picture.
Now it's your turn
That's it for now.
I hope you enjoyed this summary and got a ton of value.
Now you tell me:
Are you going to start a startup?
What do you think can be the biggest hurdle while starting your startup?
Do you agree with all the ideas above?
Have you started any startup before? If yes, how did it go?
Answer me in the comments right now.
As always, if you liked it, feel free to share with someone who you think needs to read this.