While I am all about entrepreneur marketing, I also have a strong affinity for entrepreneurs (being one myself!) With that in mind, when I was asked to be a mentor at a Startup Weekend Workshop here in Denver, I jumped on the chance.
Basically, the Startup Weekend gang gets a whole bunch of entrepreneurs in a room, ask for startup business ideas, vote for the six or seven they are going to develop and then run with them for 72 hours. The mentors are there to provide help and shoot holes in the ideas. Now, this was my first one and I did not know I would be so intrigued so I signed up for just a half a day. In the future I would do an all day gig, just to be able to see the progression and the passion these people had!
The cool thing was that there were developers and programmers there who would be actually building parts of these ideas for the final presentation. Also, the head honcho for that event was a total rockstar who was able to keep the mentors on track, helping the entrepreneurs add value without throwing our opinions about what they should be doing into the mix (too much).
So what about the problems with entrepreneurs?
The most interesting thing about hearing these snapshot business plans was the fact that the same problems kept coming up over and over. Here are the top ones, and as an entrepreneur, I KNOW I have fallen prey to them a time or two myself!
What is the problem that you are solving? or Solutions In Search Of Problems This is a biggie. Building something that is AMAZING which there is not a problem for is a sure recipe for disaster. For example, years ago we launched a program to give Realtors content for their newsletters, emails and phone calls. While we did get a little traction, it was, all-in-all a failure. While the content was great and the concept brilliant, the Realtors didn’t really want to send newsletters and emails out. They were busy doing their business and our solution did not fit into what they were actually doing. Not only were we forcing them to do something that they weren’t excited about, it made more work for them…sigh.
The Customer Is Not You! When you are going about your business and then come up with a brilliant, “I WOULD PAY GOOD MONEY FOR THIS” or “DAMN I WOULD FIND THIS DATA HELPFUL”, you are not checking to see if anyone else (let alone LOTS of anyone elses) are interested. One example of this is to collect data about a subject and then try and sell that data without any filtering or analysis. If you are a data hound, the simple act of getting it is enough to make your heart go pitter patter, but for most people, raw data is a waste of money without some help to interpret it. The data guy was sure people would be able to extrapolate from the data because it would be enough for him!
Who Will Pay Having become a business person in the dot com era, this is a big red flag for me! Many of the groups were talking about how an industry would pay or how a single person would pay a subscription. I see this A LOT in my entrepreneurs…they have heard the siren song of, if I just get 1,000 people to pay me ten bucks a month, I will be RICH! OR they see something else in the marketplace that is not as good as what they are developing and think, of course industry will switch over to a better product! If that was the case, many businesses would be using Apples instead of PCs, but getting them all to change over to your product could be a years long task.
Wouldn’t It Be Nice Or No Pain Point This one is closely related to the customer is not you. There are many things that would be nice to have (pantyhose that do not run and balloons that don’t pop come to mind) but which are not practical for the marketplace or even needed. If there is a solution that makes a situation slightly better, then there will probably not be a huge market for it. One of the examples that came to mind was a website that would aggregate all the recipes from all the websites and categorize them. While this would be nice to have, I wouldn’t pay money for it. I LIKE looking around for recipes, pinning them on Pinterest, sharing my friend’s recipes. There are already sites that have THOUSANDS of recipes all in one place and having something paid to lay overtop of those is one of those “wouldn’t it be nice” things that few people would pay for….which leads us to…
Are There Enough People With That Problem? Building a solution to fix a problem 10 people have means that it is going to cost a pretty penny. Building a solution to a problem 1,000,000 people have is also pretty daunting but a least has the chance to be cost effective. If you are just starting out, I would think that targeting a niche market with a good number of people FIRST would be the way to go. Build something that works for some people first and then move on to other niches that could use your product with some slight modification (or maybe just a little different target marketing!) While it is tempting to build something EVERYONE will need, that often leads to something so watered down that no one wants it.
Overall, I think the mentors were able to help because we had all done or seen the mistakes before. If you are entrepreneurial, you are almost guaranteed to fail from time to time. The key is to dust yourself off and try again when that happens, learning what went wrong so you don’t have to make THAT mistake again!