In 1997, the Boy Scouts of America quietly launched their Entrepreneurship merit badge. Sadly, despite the Boy Scouts' best intentions, the badge did not receive much in the way of consistent support. But on April 29, the Entrepreneurship badge was reintroduced with a much stronger commitment. As Maria Popova of the Huffington Post writes, the badge's return symbolizes 'the increasing value of entrepreneurial thinking as a social problem-solver and a necessary lifeskill in the pursuit of success today.' The badge aims to promote execution, critical evaluation of business ideas and the fundamentals of capitalizing on market opportunities.
Below, we'll take a look at the Boy Scouts Entrepreneurship badge requirements, and what they can teach you about being an entrepreneur.
Define Entrepreneurship Realistically
One striking feature of the Boy Scouts Entrepreneurship badge is how it begins by asking you to define entrepreneurship, as well as the entrepreneur's role in the U.S. economy. Yet, a glance at the requirements page shows that it is not sufficient to merely theorize on what entrepreneurship is. To earn the badge, you must find and interview a real-life business owner and ask them:
How they came up with their business idea
How they raised startup capital
How well the business is doing today
Here, the Boy Scouts are teaching an invaluable lesson: real entrepreneurial knowledge comes from real business owners. While we do not generally seek medical advice or engineering tips from laymen, non-business owners are often eager to offer entrepreneurial 'wisdom.' In his book Ruthless Management of People & Profits, Dan Kennedy laments that entrepreneurs are routinely pummeled with dubious advice from college professors, management consultants, peach-fuzzed MBAs and other theorists who have never personally run a business of their own.
No matter how well intentioned such people are, they are simply not capable of educating you the way an actual entrepreneur is. So if you reach a crossroads in your business, do what the Boy Scouts require: seek out books, articles and the counsel of other business owners.
Market Research Before Product Development
Once a handful of prospective business ideas have been generated, the Entrepreneurship badge requires some thorough market research. Among the feasibility and research tasks Boy Scouts must complete are:
Developing a list of questions to ask customers and informally interview some using that list
Choosing which business idea to pursue based on customer responses
Determining whether that idea is practical or doable
Identifying your customers, how you will reach them and the unique benefits your product/service offers
These requirements are a sorely needed reminder that when it comes to product development, demand must come first. In the late 1990's tech boom, for instance, countless startups enjoyed early success by creating products they were sure 'everyone' would use. Unfortunately, many of these companies saw this as a given, rather than a hypothesis to be tested by any kind of research. Companies that operated in this manner were among the many to go bankrupt by 2000, when the boom turned to bust.
Nor is this in any way confined to the late 90's tech boom. Many (perhaps most) failed businesses doomed from the start, because there was no demand for what they were selling. Market research wizard Glenn Livingston once said, 'the only mistake in marketing is narcissism.' That is, selling what you think someone needs, or want him or her to need, instead of what they actually need. The way to avoid this mistake, as the Boy Scouts explain, is to validate your business ideas with research, accepting only that which can be factually supported.
Project Finances & Cashflow
Next, the Boy Scouts turn their attention to what business is fundamentally all about: profit. Of course, the only way to consistently turn a profit is to sell your product for more than what it costs to produce. To that end, the Entrepreneurship badge requires that Boy Scouts:
Determine the cost of producing a product prototype
Calculate the selling price of your product/service and explain that calculation
Explain how you will sell the product/service at a profit
Decide how much startup capital is needed to begin doing business and where it will come from
There is often a great deal of resistance to figuring these things out in advance. Entrepreneurs who insist on realistic numbers and cashflow projections are sometimes dismissed as 'old-fashioned' or 'stubborn.' They are correct to insist upon them. For all the different fads that come and go with the times, the core of business never truly changes. The key to success is always finding a need and filling it at a profit. Furthermore, experienced businesspeople will tell you that cashflow is king.
Business veteran Peter Ireland explains that cashflow (not buzz or business plans) is what truly commands the respect of investors and partners. Taking all into account, many of today's entrepreneurs would benefit from a trip back to the drawing board to calculate the key numbers of their business.
The ultimate virtue of the Boy Scout Entrepreneurship badge is that it instills in young boys an understanding of the fundamentals. Nowhere in its teachings will you find trendy slogans about the 'New Economy' or bromides about corporate social responsibility. Whatever the merits or demerits of these things, they are not essential to the basic, timeless, underlying mechanics of profit making. Justice Oliver Wendell Holmes once said, 'we need education in the obvious more than investigation of the obscure.' That, in a nutshell, is what the Entrepreneurship badge requires of Boy Scouts - and offers to open-minded business owners.