So what’s the newest start-up trend? Doing it on the fly. That’s the conclusion reached by Anthony Tjan as part of the research he’s preparing for a book on successful small businesses, recently reported by Forbes. According to Tjan:
One of our most striking findings was that of the entrepreneurs we surveyed who had a successful exit (that is, an IPO or sale to another firm), about 70% did NOT start with a business plan.
Instead, their business journeys originated in a different place, a place we call the Heart. They were conceived not with a document but with a feeling and doing for an authentic vision. Clarity of purpose and passion ruled the day with less time spent writing about an idea and more time spent just doing it.
Tjan’s findings are consistent my own observation that desire to practice law is a more important motivator and predictor of success than entrepreneurial tendencies. It’s not that planning doesn’t have its place, but when you spend too much time on planning, it often turns out to be wrong or can lead you in the wrong direction. That’s the same point in Erik Ries’ Lean Start Up, which counsels new companies to focus on a minimal viable product, launching it and adapting along the way.
For lawyers, this lesson is most important. Your minimal viable product as a lawyer is really,your start up costs and at least a few clients, or the possibility of finding them. The rest of getting started involves a lot of trial and error; identifying new opportunities, and eliminating others; moving quickly to fail as quickly as you can so that you can focus on where you can succeed.
To move through the iterative process effectively, you need goals or milestones rather than a static business plan. You should be setting deadlines for launching a product if you’re a start-up or a website if you’re running a firm. You need to put spending limits and a time frame on new initiatives – so for example, if you decide to add a specialty of adoption to a family law practice, you should figure out how much to invest in acquiring needed skills, marketing the new practice area and determining whether to stick with it.
In short, there’s no such thing as a perfect or even adequate business plan in starting a firm. Just a lot of trial and error and learning as you go.