At some point in your life, you’ve undoubtedly heard someone say that all you need to do to succeed is to “follow your passion.”
While it’s true in some cases, it doesn't always (or often) translate into automatic success in the startup world. And, in many cases, following your passion can lead you straight into a failed business.
So, what’s the solution?
For starters, you need to stop thinking about what you enjoy, and instead - start thinking about your strengths and the opportunities around you.
Now, to be fair, I used to swear that the way to succeed was to follow your passion. I thought (like many do) that if you do something you're passionate about, it has to succeed because you’ll do it with love and conviction.
“I had a romantic vision of ‘I get to do what I love,’ when I should have been thinking about how to create value for other people."
I had a romantic vision of ‘I get to do what I love,’ when I should have been thinking about how to create value for other people. I was obsessed with this idea. I almost even got a tattoo that said: “Passion” (no joke).
If you want to succeed – you essentially want a 1% lifestyle.
You want to live a life that only 1% of the population can afford to live. That means you need to work harder and smarter than the 99% – who are aspiring to do the same thing.
Passion isn’t enough (everyone can be passionate) to get you there.
But, timing is.
In a study of 200 startups, Bill Gross (the founder of Idealab) discovered that timing was a bigger factor in success than your team, your idea, the business model… and even funding!
Here’s his Ted Talk (it’s only 6:40 minutes):
Timing is what matters most.
It’s why some of the biggest startups today are on top of the podium. They didn’t just follow their passion – they reacted to an opportunity in a market:
Airbnb & Uber - At a time when people needed to make more money (it was the height of a recession and we were experiencing a tight economy), Airbnb allowed people to rent out their first/second properties and put more money in their account. Similarly, Uber allowed people to make more money by simply driving their cars.
YouTube - Startups tried to do video platforms before, but failed. YouTube hit the market just when broadband internet connection hit 50% penetration and the codec issue was solved by flash, which made video access viable. YouTube didn’t even have a business model at that time.
Instagram - Just as Facebook was seeing adoption by an elder segment of users, Instagram hit the market with a simpler, mobile-focused solution.
By studying how these companies came to market, you’ll quickly realize that seeking opportunity when the time is right is critical for success.
Passion is a “nice to have,” but you need to think much more strategically:
How can I disrupt what’s already happening?
How can I change a model to deliver more value?
Naturally, it helps to see opportunity in an area you're already passionate about. This doesn't mean you can’t be successful in an area you're not passionate about, it just makes it more difficult to wake up in the morning.
Changing Your Perspective
To succeed, you have to reorient the way you approach starting a business.
Step #1 is to stop chasing money. You have to stop thinking - “How do I make a million bucks?”” and start thinking - “How can I generate value for one million customers?”
“Stop thinking - “How do I make a million bucks?” and start thinking - “How can I generate value for one million customers?”
This will serve you better as you plan because if you can truly generate value for people, the money will follow naturally (and you can leave a much bigger footprint in the world.)
It requires a shift in the way you think:
⊗“I want to start a business.” ⊕ “I want to create something valuable that’s scalable and sustainable”
"Yeah, we're always talking about following your passion, but we're all part of the flow of history. You've got to put something back into the flow of history that's going to help your community, help other people… so that 20, 30, 40 years from now ... people will say, this person didn't just have a passion, he cared about making something that other people could benefit from.”
You need to look at starting a business like a game.
And if you want to do well, it’s a game you have to win that’s less about passion and (contrary to what a lot of people will tell you today) much more related to hard work (execution) and opportunity (timing).
Passion as Leverage
Now, before I’m accused of being a “passion-basher,” I want to be crystal clear that passion can be leveraged in a market.
However, you need to understand that the first player in a category or market is usually the leader. This is almost always the case – just think of Coca-Cola and Microsoft.
So, when a leader already exists the best approach is to change the rules of the game:
Use a different business model (e.g. freemium)
Be the first to leverage a different technology or platform (e.g. mobile)
Connect people and communities (e.g. two-sided market model)
More importantly, change a rule that a large number of people care about. It’s pointless to do freemium in an industry where everyone wants premium.
But, there are other ways to become a leader if you’re not first. You can create a new category, a sub-category, or bring multiple ones together in an ‘all-in-one’ approach.
So...if you’re passionate and the market is saturated, these approaches can make it easier to leverage your passion for creating a new category.
Ben Horowitz gave this advice to the graduating class at Columbia University’s Fu School of Engineering and Applied Science in 2015:
“Following your passion is a very “me”-centered view of the world. When you go through life, what you’ll find is what you take out of the world over time — be it money, cars, stuff, accolades — is much less important than what you’ve put into the world. So my recommendation would be follow your contribution. Find the thing that you’re great at, put that into the world, contribute to others, help the world be better and that is the thing to follow.”
For example - imagine a guy who’s obsessed with American minor-league baseball. He goes to 60+ games a year, knows a few of the players, and even has lunch with one of the coaches on occasion.
But, he’s also a digital marketer and notices that nobody really owns the minor league baseball ticketing niche. His friends complain that most ticketing sites are too generic and don’t always carry tickets for all events.
Now, it’d be difficult for him to start a full-blown sports marketing agency.
But, if no one is owning the minor league ticketing niche, he can jump into it and leverage his passion to grow it. So, in this case, passion is a good thing, and it’s at it’s best when you can leverage it to own a niche and be first to market.
The next step is finding the things that’ll set you apart from your competitors (if you have any). This is called your ‘unfair advantage’.
Your Unfair Advantage
If you want to make it, you need some kind of “unfair advantage.”
While timing can be on your side it’s also become super competitive – so it’s not always enough. This is why it’s critical to always be learning (e.g. read, network, and work with (and for) more clever people that yourself).
Here’s my unfair advantage in the context of creating Hotjar:
I’ve been in the CRO (conversion rate optimization) world for nearly 15 yrs.
I have a background in UX/software/product
I already grew a very successful software company and made a lot of mistakes doing so
I’ve worked with some of the best CRO/Growth companies in the world
I’ve attended many events and connected with thought leaders
I’m also the ideal customer myself, and for this reason (together with extensive digital marketing experience), I know how to reach a very large number of prospects.
Finally, my passion (see how this is leveraged to bolster my unfair advantage) is UX and building products. I’m product designer at heart.
All of those factors combined make for a compelling unfair advantage.
Note that my passion has made it possible to have an advantage. By specializing and investing in my passion I've created this unfair advantage. This allows me to have a methodology and a voice giving me the upper hand over those who have neither.
So, what’s your unfair advantage?
Maybe your passion is cooking food…
You’ve read every book about a particular type of cooking (e.g. vegan)
You attended every event on a vegan cooking
You're a member of multiple vegan cooking communities and have networked with members extensively
Perhaps you’re well connected with many vegan chefs
Or, maybe it’s all of the above
That’d be an unfair advantage over someone else looking to start a business in the vegan cooking space who just watched a bunch of episodes of “Hell's Kitchen” on TV.
Hopefully, you're seeing how you can convert your passion into an unfair advantage – but remember – this can only be leveraged if there’s a market opportunity.
As we said earlier, it’s timing that truly matters most. Here are some examples of what opportunities/good timing can look like:
Competitors are expensive and there’s no affordable solution available
There’s no great solution on mobile
Only old business models exist and the alternatives are too complex
There’s too much fragmentation (create an all-in-one solution)
If no one is specialized - go niche!
Passion is a multiplier of success - not the reason for it:
So, go crazy following your passion.
But, only if it’s directed towards a wide-open opportunity in the market and coupled with a large dose of unfair advantage. And, if you do your best to follow the formula to success and get it right, who knows…
...you might end up being the next Airbnb.
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Founder / CEO at Hotjar - David is an entrepreneur and consultant that has generated hundreds of millions of dollars for small to large businesses over the last 12 years. He has run hundreds of tests for his clients… across 19 languages, 12 currencies and 13 industries. In one of his most recent projects he generated $16 Million in life time value for an e-Commerce SaaS.