Barriers to Entry

When people talk about starting a new business or entering a new market, a common topic of discussion is barrier to entry.  Simply put, barrier to entry refers to how difficult it will be for you (or your competitor) to enter that market and what obstacles stand in your way.

Traditional business models determine barriers to entry by looking at things like capital requirements, government regulations (for example, you can’t practice law unless you have a law degree and pass the bar), or economies of scale (can you compete on price against Walmart?).  Indeed, these are serious hurdles to consider and prepare for when you’re writing your business plan.

But I think the greatest barrier isn’t any of these, and actually doesn’t reside in the market itself.  The biggest obstacle to moving into a market or creating a new business is the mental hurdle you must clear between coming up with the idea and taking action.  I can’t tell you how many people I talk to every day who have great business ideas that will never see the light of day because they don’t (won’t) act on them.

Think about it….once you make the decision to pursue your dream and move forward (or ship, as Seth Godin puts it simply), the rest of those barriers will fall like dominoes.  They’re no match for your passion, your resolve, and your will.

 

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3 Responses to “Barriers to Entry”

  1. Wes Says:

    Great post Matt!! If I may….I also think people talk to too many people about their idea and get too many opinions and too much feedback before they start. The most successful business owners I know had blinders on when they started. They did not care what anyone else thought. They are stubborn people who believed that there is no other option for them than to make others want to hand over their hard earned money in exchange for what they do well. I believe their stubbornness and their passion and their ability to ignore people is what made them start. If for one second, you think to yourself their are other options for you, you probably won’t start.

  2. Nick Says:

    I feel like many times opinions make us see our ideas through a pessimistic filter. Don’t get me wrong, planning is key, but it’s your idea and your plan. I think Wes has something there. if you believe in your idea, surround yourself with Superfans and ignore the naysayers. Chances are your response to hurdles along the way will sharpen your idea with more motivation and less haste than listening to everyone’s opinion. Great post Matt!

  3. Dan Says:

    I guess this is why the world is littered with people who have great ideas, but we are light on people who have execution experience. I want to be somebody who executes, not somebody who stops before the dream even begins.

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