Vision without execution is hallucination.
— Thomas Edison
Among the many exciting exit opportunities for consultants, entrepreneurship is a small but growing option.
While hard to track as a general trend, starting one’s own business is an option always at the back of a consultant’s mind. Entrepreneurship has a unique allure, replacing corporate hierarchy and working on other people’s ideas with ultimate flexibility and endless possibilities.
So, do consultants make good entrepreneurs?
The debate is ongoing: Consultants are praised as adept problem analyzers and idea generators, but their real-world effectiveness is questioned.
Are consultants actually just money-hungry middlemen with little value to contribute, who jump ship once the polished slide decks have been presented and the bill has been processed?
The tension between vision and execution is what makes the consulting skillset both valuable and yet incomplete for entrepreneurship: frameworks and strategy provide structure, but without execution they risk becoming mere hallucinations.
What consultants bring to the table
The following are three (3) of the transferable strengths that consultants are able to bring to startups.
1. Structuring uncertainty
When approaching the unknown, entrepreneurs often rely on their own gut feelings or simply shoot at whatever targets appear in front of them. The consulting mindset can apply an organized approach to new or unique situations to help bring vision and ideas to reality.
For example, applying structured frameworks can make complicated decisions simple and provide a path for data collection. If used properly, the consulting mindset can actually free an entrepreneur to focus on mission-critical objectives, such as finding and solving a monetizable pain point.
2. Analytical rigor
In a world of constantly moving or impossible to find data for reliable decisions, a consultant has an arsenal of collection approaches. At early stages, startups often have limited information about the market and customer problem. Gaining access to reliable information can be the difference between an all-out flop and a billion-dollar enterprise.
For example, the founder of a mountain bike startup might assume that avid bikers would be willing to pay for new comfortable seating features based on a web of conversations and his own experience with uncomfortable bike seats. However, the founder might misunderstand the level of comfort needed or how much bikers are willing to pay to upgrade. Here a consultant can contribute by introducing structured market research and rigorous testing.
3. Quick adaptation
Since consultants typically have experience across a broad range of industries and have jumped from project to project over their tenure, they are well-equipped to adapt to the changing environment of a startup. Pivots are common in entrepreneurship. Often what differentiates the winners from the losers is their ability to move quickly to pursue a more favorable idea when new information invalidates previous assumptions.
For example, an ex-consultant might be launching a SaaS product for a healthcare provider. While the software was designed to address nurse burnout, the business finds itself unable to grow subscribers beyond early adopters. Drawing on varied experiences in corporate strategy, social impact, and market entry, the ex-consultant is able to quickly identify the problem, such as that the product adds more complexity than the previous solution. The consultant is able to then quickly pivot the product to achieve product-market fit and go on to capture the market. Consultants have learned to let go of previous mindsets, which is a unique and valuable trait for a startup founder.
What consultants lack
The two dangers for consultants moving into entrepreneurship are lack of execution skills and over-analysis. Both can result in wasted time and unrealized dreams.
1. Lack of execution skills
Success in entrepreneurship is measured by what you do rather than what you say you do.
While hours scrutinizing data or customer calls to glean insights is useful in the discovery phase, there will never be sufficient information to make a decision with complete confidence.
Action must be taken, often with more unknowns than certainties. To be successful, founders must be crazy about their idea and willing to throw their fate onto the jolting high-speed train of possible success.
Founders ultimately might lose everything, but they might just as soon win big. That’s the gamble. To transition into entrepreneurship, consultants must learn to be comfortable with uncertainty while seeking to limit it as much as possible.
2. Over-analysis
Over-analysis, or what is often termed analysis paralysis, can result from a constant obsession with information, rabbit-hole ideas, or the need to validate decisions at every step. Time spent over analyzing is time that could have been spent making forwards progress.
Sometimes, entrepreneurs have to do everything by themselves just to make the business work. Founders may not have the budget to employ other people to be HR, customer service, or quality assurance. They have to create it all from scratch, which is why time spent over analyzing can be so costly.
In a startup, everything is a minimum viable product. Time to ditch hours of deck making and spreadsheet designing and just get moving!
The Bottom Line
Do consultants make good entrepreneurs?
Yes, but only if they can embrace discipline and execution.
In the end, they must overcome the obsession with analytics that drew them to consulting and dive into the soft-skills and messy thinking of founder-led sales.
Data must become a tool for decision-making, not a time-consuming decision-paralyzing crystal ball.
If they can combine rigorous analytics with vision and drive, consultants can make the best kind of entrepreneurs.
Wes Brooks is an incoming Summer Business Analyst at Cicero Group and an undergraduate studying economics, management, and strategy. He is a serial entrepreneur, works in venture capital, and enjoys singing a capella and piano improvisation.
Image: DALL-E
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