I often meet people starting up small businesses, or running young small businesses, who have aspirations of making lots of money. That’s certainly a reasonable goal.
They open coffee shops, start an e-commerce site, create a consulting practice, work on a blog, launch a retail store, maybe even develop a new app. It’s all very nice. Except there’s one thing missing: a market big enough for their dream business that also delivers on their money-making dreams.
Here’s a perfect example: U.S. News and World Report recently ran a story about the exploding demand for old computers, particularly in Asia. Why? It’s thanks to the popularity of digital currencies, where “mining” — which requires running a complex series of algorithms for a long time — can literally create money. “Miners” of digital currencies have discovered that if they put a bunch of PCs to work over a period of time churning out these algorithms, they can grow bitcoins out of nothing.
But they need lots of PCs to do this. Enter the small PC shops of Hong Kong and Singapore. “The revenue is large,” Jerry Wu, a manager of one of these shops, told U.S. News. He’s selling cryptocurrency mining equipment — boring, dirty computers — at a fast clip and raking in thousands of dollars in profits.
Shopkeepers in Singapore are also ringing up huge profits. “There was a customer who asked for a rig with 500 GPU cards, which amounted to over S$350,000 ($262,700),” one shop owner said. Others report supply shortages and heavy demand from customers as far away as Vietnam, Malaysia, Indonesia, and Russia. They all want to use computers to strike it rich in the cryptocurrency mining game — so long as it lasts. Good for them, right?
But this isn’t about computers — or mining digital currencies. It’s about seizing an opportunity.
Because currency mining is hot, scores of entrepreneurs have opened up new computer businesses throughout Asia selling their wares, and big chip makers are redirecting their investments to meet this demand.
Is this their “passion” or their “dream business”? It’s neither. It’s just an opportunity to respond to a market need.
These people are unlike the dreamers and “entrepreneurs” I meet who start businesses out of their “passion” and “love.” These are men and women who are out to make a buck. They see a market and they attack it. Selling motherboards and power adapters isn’t sexy. I’m betting none of these entrepreneurs are “passionate” about what they do. But they’re seizing an opportunity and profiting from it — until they move on to the next big thing.
So, before you start up your business — or maybe you’ve already started one and you’re struggling to grow it — think about this: Is there really a market for what you do? Will you make enough money to make it worthwhile?
If not, perhaps it would be better to find something less exciting, less sexy, but much more profitable, to spend your time doing during the day so that you (and your family) can better enjoy your life after hours.