Jim Duffy: Roll up for the delusional start-up tour

'Boss, the plane, the plane!' Yes, it was these immortal words from Herve Villechaize aka Tattoo to Mr Roarke on the programme Fantasy Island that I always knew would lead to a good story.

Don't find yourself stranded on entrepreneur Fantasy Island, says Jim Duffy. Picture: Ian Howarth
Don't find yourself stranded on entrepreneur Fantasy Island, says Jim Duffy. Picture: Ian Howarth

At a luxurious, but remote tropical island, the enigmatic Mr Roarke would make the dreams and fantasies of well-heeled guests come true. Money was no barrier and what the guests thought would be a terrific fantasy on many occasion turned out to be anything but.

Usually, as with all fantasies they had not thought it all through, so different circumstances and outcomes would pop up and surprise them. This then got me thinking about people who start businesses from a laptop and a spreadsheet and create their own fantasies.

Sign up to our Opinion newsletter

I once had a guy – who we will call an “entrepreneur” as he told me he was one so I had to believe him – tell me his business was valued at £20 million. “Great news,” I thought as I studied him. “Can you tell me all about it and how many staff you have?”

“Tell me about the profit you make and all of your plans for growth.” And this is where the conversation became a little strained. He pulled out his MacBook Pro and opened it up, where I was presented with a spreadsheet. Now, I’m not a big spreadsheet fan, but I sat and had a good look at it all the same. The spreadsheet outlined a £4m profit in year three. It showed explosive growth in customers using his mobile app. I must say it all looked good and most plausible on a laptop screen. But, when I asked him some questions about the £4m profit, I ended up with more and more questions.

With not one customer at that time, this “entrepreneur” had created his very own fantasy that would have fitted well into an episode of Fantasy Island. He was convinced beyond reason that his early adopter customers would jump at the chance to use the app and that the money would tumble in thereafter. I could see Mr Roarke and Tattoo shaking their heads behind the scenes as this fantasist in front of me was living in a world of make believe. I suggested that he go out to a friend of mine who would be a model customer for his app.

A few days later I got two rather interesting phone calls. One from my colleague who told me that the “entrepreneur” was deluding himself and one from the “entrepreneur” telling me that my colleague had been rude and did not understand how the app worked, so dismissed it. “Oh dear,” I thought, “the grim reality of facing a customer asking hard questions of your wonderful spreadsheet that is in fact, a fairy story or fable.”

Suffice to say, the man with the £4m profit business in year three is no longer contactable and has in fact disappeared into a black hole, despite me suggesting that he keep talking to customers to get more feedback and insight.

This approach is typical of many start-ups who hear the siren voices and get seduced by spreadsheet madness. A zero here and there is easy to add into the spreadsheet and this is where it moves from reality to fantasy. I’m not going to stifle anyone who wants to start a new business – far from it.

But I would suggest from experience that the best way to do this is to co-create the business with customers and be prepared to pivot and swap out staff. As I tell people who apply for the Moonshot Academy, there is no point in starting out with the wrong people taking up precious seats in the spaceship. It only adds to the load.

Co-creation with real people who you believe will buy your products really helps with product/market fit. It is very different from the Fantasy Island approach on a spreadsheet, where Mr Roarke and Tattoo will allow you to live out your fantasy of being an entrepreneur for the day.

There is nothing wrong with talking to people about your idea. Trust me, it is where you gather your best insight.

• Jim Duffy is co-founder of The Moonshot Academy and author of Create Special