Three years ago, we were living the entrepreneurs dream at Ecquire – 11,000 customers within a couple of months, feature write-ups in Newsweek, Inc. Magazine, the Wall Street Journal, PC World, MacWorld, CNN etc. and seed funding from a venture group. It didn’t mean anything. We only had 30 customers using our paid version.
- What was going on? We built something we thought people would like and assumed we were smarter than our customers. This was bad.
- Where are we now? Much better off and healthier as a company. We haven’t been in a magazine or a blog for awhile, and we haven’t needed to spend the money we did three years ago.
- What Changed? The same thing that I now recommend to entrepreneurs looking for advice: Shut up and Listen – if you want customers to pay you, find out what they want to pay for. And trust me, people will happily pay for things if you resolve a pain point that they have and the cost is reasonable.
My only caveat before I start in on listing 5 Simple Steps to Improving Your Startup, is that my readers understand I am just one person with a set of opinions, and these worked for me. But you should always challenge yourself to always find better practices – it is part of the entrepreneur evolution, and change is usually for the better!
1. Get Some Coffee:
Try to bounce your ideas of the “right” people – decision makers at similar companies you intend to sell into. Tell them you have an idea but aren’t sure if you’re spinning your wheels, or if it’s actually viable. Play up the student or entrepreneur card. Ask them if they’d pay for the product/service when it is finished and ready, and if they say no find out why.
Look at what you have – Beta users, early adopters, first customers, referral base and potential advisor or board member.
Why is this important? If you find that they like it, then you know you have the right industry and customer base. If they don’t, maybe you need to be asking different types of questions, thinking about new features, or talking to another group entirely.
2. Research Your Competitors:
When people used to tell me competition was a good thing, I looked at them like they were obviously never going to run a successful business. Competition will force you to be aggressive, and at some point an investor or customer is going to find them. For the customer, you need to be comfortable explaining why your service is better, and if you’re not – you need to have a plan to combat that. The same goes for the interested investor - they love asking this question. These questions will also help you see if you’re wasting your time, or if your idea is not that novel. If the competition lists their clients, try to get in touch with someone who uses their services at one of the companies. Find out what’s the real sentiment by someone who is using the competition.
Look at what you have – A better understanding of the landscape, and what you may realistically charge for your product or service that the market will bare.
Why is this important? You could spend years developing an invaluable product or service, or produce something that is not better than the competition.
3. Become an Expert
There’s got to be a pain point you are resolving, and the people that are feeling this “pain point” are reading or looking for information in the same places. Read what is currently being complained about, and do some research on what could help or try to help, then offer legitimate help – but don’t be a talking head. Find research from a credible source in your field and find expert writers, bloggers, and academics. Follow what they write, and come up with, and used LinkedIn, Twitter and Facebook with the purpose of getting people to follow you and consider you as an expert. Start this now – it will take a while.
Look at what you have – By the time your product is ready, you’ll have people waiting to hear what you have to say or want to know what you are doing. Ask them to be a part of your beta group and you’ll have some early evangelists of your service (if it’s a good service), and all you did was write a post about it.
Why this is important? It will force you to become aware of what is trending and what’s happening in the market so you can become better at informed decision making. You will have a network of followers that can give you instant feedback and credibility as you enter the market as a player or a leader of your organization.
4. Check in with Someone Smarter Than You
There are a lot of great people in this world who actually want to help, and who are very intelligent. Find that person(s), and have him/her check some of your assumptions and your startup’s direction. Encourage them to challenge you, and answer their tough questions – honestly. Many people tend to focus on thinking everything is going to be fine, when they should be looking for potential obstacles.
Look at what you have – Choose an individual who’s going to save you significant time and money because of their experience, as well as someone who can make some lucrative introductions for you.
Why is this important? You can only be as good as one person’s potential if you don’t have another perspective.
5. Your Service/Product Must Be Simple and Exciting
This of course will not cost anything (during the concept phase), but it is vital that you understand what a limited window you have to get potential employees, partners, investors, and customers excited. You have to hit a home run in 20 seconds or less. Some people will tell you that an elevator pitch is 45 sec – 1 minute. I say that I have much less time to get you to ask for more – and you need to show the “goods.” If it’s not simple and exciting, you’ve created a mountain in front of you.
Look at what you have – Something that is easy (conceptually) to grasp and something that is easy to make tweaks to. You can practice your elevator pitch or pain point question on anyone at anytime – if it’s easy to grasp. If you’re not getting someone excited, it doesn’t mean that you don’t have something great (you also might not have something great), but it might mean you need to figure out what the real pain point is, or you need to say it differently to get someone’s attention. And when your “item” is actually built your window is considerably less, and you’re not there to keep them focused.
Why is this important? You always have to be on the hustle and you don’t know who or when you’re going to run into your next customer. If it’s simple and exciting it could be anyone.
Email me any time firstname.lastname@example.org – Good luck and don’t get frustrated, you get better with every challenge you get through.