In the world of entrepreneurship, the focus has traditionally been on the idea and the pitch. However, it has been proven that few billion-dollar entrepreneurs have built successful unicorns solely based on their ideas. Instead, the key to success lies in entrepreneurial strategies and skills. A prime example of this is Elon Musk, who took an idea where large car makers had failed and turned it into a unicorn through strategic planning and execution.
Unicorn-entrepreneurs have followed five key paths to build their successful companies. First Movers seek to find a product or strategy that has not been used before, but only about 11% of them end up dominating. Fast Followers imitate a successful idea on an emerging trend, often requiring more capital. Smart Followers, on the other hand, are the strategy used by most billion-dollar entrepreneurs. Price Cutters focus on offering lower prices, while Consolidators acquire companies to build a big business, usually requiring access to capital.
Examples of successful Smart Followers include Steve Jobs, Bill Gates, Jeff Bezos, Brian Chesky, and Travis Kalanick. These entrepreneurs focused on early entry into industries before they took off, a strong understanding of emerging trends, and the ability to identify the best product-segment-competitor mix for a competitive edge. Price Cutters like Jeff Bezos have found success by combining price cutting with the lower cost of emerging industries.
Consolidators, on the other hand, usually have access to capital which is used to acquire a strong base company in a fragmented industry and then acquire other companies to build a big business. Entrepreneurs need to have the skills and strategies to identify emerging industries and trends, as well as the ability to implement the unicorn-strategy to succeed. Those without the necessary skills or strategies may struggle to turn a profit and could get caught in margin hell. Most unicorn-entrepreneurs have used smart follower strategies before utilizing their skills to dominate their respective industries and finance smart strategies to achieve success.
