6 ms·

A Lesson Learned as a Technical Founder: Sell First, Build Later

107 points by vu0tran 13y ago

tel 13y ago
This is at its core tremendous advice... But let me temper it: don't sell, validate. In many applications sale risk is cheap enough (customers forgiving enough) that sales-as-validation is ok. Sometimes it sets up really bad expectations, though. It's easy enough to validate without selling: just don't take people's money. It's less valuable than sales since you can't be sure people are making accurate financial decisions until you have their money, but it's both dramatically better than sitting in isolation coding and carries very low social risk.
jfabre 13y ago
So true, we had to read Steve Blank to figure out this one. Our previous mindset was: let's build an 'MVP'(more like alpha/beta) and see how it goes. Don't code an half-baked product to test the market when you can build demos and talk to real people.
jk4930 13y ago
tl;dr: market research + presales.
trevoro 13y ago
Excellent advice. Quite often when technical founders aren't quite sure how to go about the validation process, we tend to double-down on development. Instead the exact opposite is what seems to work best; get out there and talk to people you think need your painkillers.
ddedden 13y ago
While I agree that you should validate your ideas before spending copious amounts of time programming, I don't think that you should sell people on an imaginary product. Unless you already have an established reputation, it's highly doubtful that people will pre-order something on mere talk alone. I think that it's a better idea to stick with the MVP (minimum viable product) model and iterate rather than try to figure out revenue and customers right off the bat.
- Swizec 13y ago
  A minimum viable product is one users will pay for. Otherwise it's not viable.
  - enraged_camel 13y ago
    There's a difference between a minimum viable product and a minimum viable idea. It sounds like the OP wants to sell the latter before building the former. Or, as the saying goes, put the cart before the horse.
    - lifeisstillgood 13y ago
      Nice distinction.
    - rhizome 13y ago
      Could be that an MVI is any idea that can be used to secure funding, in which case it would put the concept in league with a rather unsavory brotherhood.
    - tyang 13y ago
      You can do a cheap prototype, mockup or wireframe. If you can code, just code something simple you can test with minimal features. Most failed sites and apps have way too many features that no one except technical founders and their 37 friends want.
  - Retric 13y ago
    True, but viable means slightly more than that. It's viable when the average cost of acquiring a customer is below the lifetime value of a customer.
- saraid216 13y ago
  I don't think you've been watching the discussions surrounding Kickstarter over the past year or two.
  - 13y ago
mrgreenfur 13y ago
This is great advice, does anyone have some resources on how to pre-sell or pre-validate a product without much to show? I mean, I've always tried but if you describe something to someone and say "do you want this? Will you pay $20 for this?" they always say, "cool! sure!" and then don't answer when you come collecting product in hand.
- waterside81 13y ago
  patio11 has a good description on his site kalzumeus.com of how he market tested Appointment Reminder before he sold it to his customers. Sorry, don't have the link on me, but his whole site is pretty chock-full of good advice on selling software. Going through his lifecycle email course now, learning a lot.
  - grncdr 13y ago
    IIRC he has stated that he misjudged the demand for Appointment Reminder and ended up selling less than he had hoped.
  - patio11 13y ago
    Here's the meat of it, reposted from an HN comment since it is my most succinct account of the story: A spiritually similar example: Appointment Reminder didn't actually exist in summer 2010, but I had a two-page demo of it set up. I got $400 out of an ATM when I went home to Chicago to visit, and just wandered around the Gold Coast/Magnificent Mile region of the city looking for every hair salon and massage therapy practice I could find. I asked them all if I they took walk-ins and, if so, could I have 30 minutes of the owner's time for whatever the rate was ($30 or so). In lieu of the shoulder massage/etc, I said "I'm interested in the massage therapy industry. Would you mind if we just chatted for half an hour about it?" And I asked about how they handled scheduling, appointments, no-shows, etc etc. I also did a demo of my two-page AR mini-app on the iPad and asked if they would be interested in buying it when it was ready. I think only one person actually accepted my money for the interviews. I got five-ish "Please tell me when that is ready" out of a dozen or so conversations. No Bay Area or signup form required. (I put their emails in a paper notebook. And lost it prior to launch. Whoopsie.) This was mostly successful for me: it confirmed that there was a market willing to pay for AR without me needing to actually build it to demonstrate that. (My sampling technique, which found only massage therapists/hair salons, did sort of lead me off the rails as to who I'd eventually end up targeting for most of the business. D'oh.)
mkoble11 13y ago
Fantastic advice. I first learned about this fantastic advice from a blog post by Dan Martell that I read a year or two ago. Unfortunately, I can't find it on his blog or searching Google or I'd post it. :\
jabbernotty 13y ago
Does advice like this apply in some way to personal/career development? I would like to break in to a particular technical field. I believe that to work in that field, I'll need to demonstrate some measure of experience in that field. To that end, I'll need to build. This feels like a 'build first, sell later' kind of approach. Or should I tip the scale toward 'selling' myself on the basis of my other useful experience, and build my expertise on the job?
- taf2 13y ago
  IMO - you have to always sell first in everything you do... yes we want to build first to prove first... but convincing someone else you are capable is the first thing to be done... assuming you can really do it - if you don't sell first no one will give you the chance...
205guy 13y ago
This _sounds_ like great advice, and "I want to believe" too, but this article is not convincing. The way it's written, I just see some principles flatly stated and not even backed up with anecdote--it's not even a data point. The HN title "A Learned Learned..." contains the most indication that the OP is speaking from experience and not off the top of his head. Forgive me for not knowing the OP, his experience/reputation, or his company and its product. I expected a bit more explanation for his position. Also, I'm a bit skeptical of the "refundable credit" for a non-existing service or product. I'd like to hear more about how that's possible.
startupstella 13y ago
we definitely experienced this at matchist, and it has made us waste valuable months. now, we don't build ANYTHING unless at least 3 customers request it and unless it will affect the bottom line (no fancy feature upgrades)
beat 13y ago
Before even delving into development beyond the internal spikes, put together your business model! You should have a pretty good idea who (and how numerous) your customers are, how much they're willing to pay, and how to reach them. Once you have those, you have some revenue numbers. From there, you can extrapolate at least a rough outline of a business plan. If you can't figure out who the customers are or what they'll pay or how to get them to pay, then maybe you're sitting on a nice open source project instead. Lack of a business objective doesn't mean you shouldn't do it, but maybe it means you shouldn't try to make a living from it.
- ryanSrich 13y ago
  After our first failed startup due to a lack of costumer interest we didn't even touch a text editor until 120 customer interviews. We wanted to be damn sure the problem we were attempting to solve was an actual problem. During this search process we built out our business model canvas making the necessary changes along the way. Each week we focused on a certain section of the canvas and challenged those assumptions against what our customers were saying.
31reasons 13y ago
I think as a Startup you should spend 90% of your time on refining and validating the Problem Definition. Do as much as you can of that activity without even creating a single line of code. Since most probably you are solving a human problem, you should interact with as many humans as possible. Lets be honest, unless you are creating a rocket or some really cool new technology, most Web Services/Apps can be implemented by anyone. YOUR job as Startup is not to reinvent the wheel for the solutions but live and breath the problem definition. After all it will be much cheaper and faster to fail if you have not built the product yet.
- tyang 13y ago
  This is great.
lifeisstillgood 13y ago
I really think its worth re-reading Venkatesh Rao's "Entrepreneurs are the new Labour" and his dissing of the Lean Startup movement (tldr - it's a great way for in estors to have control / viaibility over many more compliant startups than if entreprenuers really had peer power.) Yes, go validate your assptions, get out of the building. But decide where your exit is, where your talents lie and how much is the opportunity cost.
thornad 13y ago
If you, like a lot of the startups outthere , are going ot make another better shopping, better video sharing, or better... whatever service/product then by all means, do that. But I bet you nobody who ever did anything original did that first. Because by definition if you want to come up with something new and different, people will invariably say No until they can actually touch it and feel it. After that they may or may not say yes, but definitely not before.
noveltyaccount 13y ago
Do folks have experiences to share on validating the idea without giving it away? Isn't there a risk that the if you tell people one of them will take your idea and run with it?
- tyang 13y ago
  You test your idea on actual customers, you don't tell your idea to HackerNews. And even awesome companies like Facebook screw up when they test by running bad tests. Example: Home. Facebook tested Home on employees who usually use iPhones. Oops. If any of them read Robert Scoble or talked to a single Android fanboy, they'd realize Android is about customization. If a Nexus fanboy likes the Sulia widget or whatever you call it, said fanboy is not going to want to use Home when Home displaces Sulia.
- wpietri 13y ago
  "Don't worry about people stealing an idea. If it's original, you will have to ram it down their throats." -- Howard H. Aiken I think it's a legitimate worry, but a small one. Novice entrepreneurs overvalue ideas. The majority of startups make major changes along the way. E.g., PayPal was, what, Levchin and Thiel's fifth product? And the real magic to PayPal wasn't money transfer; it was the loss prevention that kept the business viable. The thing that distinguishes successful entrepreneurs isn't that they all had one good idea 5 years ago. It's that they kept having new ideas, and had the drive to push their ideas out into the world so that they could learn enough to spark the new ideas. Practically, there may be a very small number of people who a) are smart and experienced enough to appreciate your idea, b) have more resources to execute, and c) aren't busy doing something they like better. Try not to let those people understand the secret sauce. But those people are hopefully not your customers, who are the main ones you should be validating your idea with.
tyang 13y ago
Replace all: "technical founder" to "founder". Otherwise perfect. A+.
biot 13y ago
A corollary for today's frothy times: 1. Put together team 2. Sell: get acquihired 3. No need to build anything later
Terpaholic 13y ago
It also helps to be your own customer (or in that demographic). I'd suggest that you should have some kind of validation metric for knowing when to continue with the project as well, otherwise a project can drag on for much longer than it should.

107 points by vu0tran 13y ago

tel 13y ago

This is at its core tremendous advice... But let me temper it: don't sell, validate. In many applications sale risk is cheap enough (customers forgiving enough) that sales-as-validation is ok. Sometimes it sets up really bad expectations, though. It's easy enough to validate without selling: just don't take people's money. It's less valuable than sales since you can't be sure people are making accurate financial decisions until you have their money, but it's both dramatically better than sitting in isolation coding and carries very low social risk.

jfabre 13y ago

So true, we had to read Steve Blank to figure out this one. Our previous mindset was: let's build an 'MVP'(more like alpha/beta) and see how it goes. Don't code an half-baked product to test the market when you can build demos and talk to real people.

jk4930 13y ago

tl;dr: market research + presales.

trevoro 13y ago

Excellent advice. Quite often when technical founders aren't quite sure how to go about the validation process, we tend to double-down on development. Instead the exact opposite is what seems to work best; get out there and talk to people you think need your painkillers.

ddedden 13y ago

While I agree that you should validate your ideas before spending copious amounts of time programming, I don't think that you should sell people on an imaginary product. Unless you already have an established reputation, it's highly doubtful that people will pre-order something on mere talk alone. I think that it's a better idea to stick with the MVP (minimum viable product) model and iterate rather than try to figure out revenue and customers right off the bat.

Swizec 13y ago
A minimum viable product is one users will pay for. Otherwise it's not viable.
- enraged_camel 13y ago
  There's a difference between a minimum viable product and a minimum viable idea. It sounds like the OP wants to sell the latter before building the former. Or, as the saying goes, put the cart before the horse.
  - lifeisstillgood 13y ago
    Nice distinction.
  - rhizome 13y ago
    Could be that an MVI is any idea that can be used to secure funding, in which case it would put the concept in league with a rather unsavory brotherhood.
  - tyang 13y ago
    You can do a cheap prototype, mockup or wireframe. If you can code, just code something simple you can test with minimal features. Most failed sites and apps have way too many features that no one except technical founders and their 37 friends want.
- Retric 13y ago
  True, but viable means slightly more than that. It's viable when the average cost of acquiring a customer is below the lifetime value of a customer.
saraid216 13y ago
I don't think you've been watching the discussions surrounding Kickstarter over the past year or two.
- 13y ago

mrgreenfur 13y ago

This is great advice, does anyone have some resources on how to pre-sell or pre-validate a product without much to show? I mean, I've always tried but if you describe something to someone and say "do you want this? Will you pay $20 for this?" they always say, "cool! sure!" and then don't answer when you come collecting product in hand.

waterside81 13y ago
patio11 has a good description on his site kalzumeus.com of how he market tested Appointment Reminder before he sold it to his customers. Sorry, don't have the link on me, but his whole site is pretty chock-full of good advice on selling software. Going through his lifecycle email course now, learning a lot.
- grncdr 13y ago
  IIRC he has stated that he misjudged the demand for Appointment Reminder and ended up selling less than he had hoped.
- patio11 13y ago
  Here's the meat of it, reposted from an HN comment since it is my most succinct account of the story: A spiritually similar example: Appointment Reminder didn't actually exist in summer 2010, but I had a two-page demo of it set up. I got $400 out of an ATM when I went home to Chicago to visit, and just wandered around the Gold Coast/Magnificent Mile region of the city looking for every hair salon and massage therapy practice I could find. I asked them all if I they took walk-ins and, if so, could I have 30 minutes of the owner's time for whatever the rate was ($30 or so). In lieu of the shoulder massage/etc, I said "I'm interested in the massage therapy industry. Would you mind if we just chatted for half an hour about it?" And I asked about how they handled scheduling, appointments, no-shows, etc etc. I also did a demo of my two-page AR mini-app on the iPad and asked if they would be interested in buying it when it was ready. I think only one person actually accepted my money for the interviews. I got five-ish "Please tell me when that is ready" out of a dozen or so conversations. No Bay Area or signup form required. (I put their emails in a paper notebook. And lost it prior to launch. Whoopsie.) This was mostly successful for me: it confirmed that there was a market willing to pay for AR without me needing to actually build it to demonstrate that. (My sampling technique, which found only massage therapists/hair salons, did sort of lead me off the rails as to who I'd eventually end up targeting for most of the business. D'oh.)

mkoble11 13y ago

Fantastic advice. I first learned about this fantastic advice from a blog post by Dan Martell that I read a year or two ago. Unfortunately, I can't find it on his blog or searching Google or I'd post it. :\

jabbernotty 13y ago

Does advice like this apply in some way to personal/career development? I would like to break in to a particular technical field. I believe that to work in that field, I'll need to demonstrate some measure of experience in that field. To that end, I'll need to build. This feels like a 'build first, sell later' kind of approach. Or should I tip the scale toward 'selling' myself on the basis of my other useful experience, and build my expertise on the job?

taf2 13y ago
IMO - you have to always sell first in everything you do... yes we want to build first to prove first... but convincing someone else you are capable is the first thing to be done... assuming you can really do it - if you don't sell first no one will give you the chance...

205guy 13y ago

This _sounds_ like great advice, and "I want to believe" too, but this article is not convincing. The way it's written, I just see some principles flatly stated and not even backed up with anecdote--it's not even a data point. The HN title "A Learned Learned..." contains the most indication that the OP is speaking from experience and not off the top of his head. Forgive me for not knowing the OP, his experience/reputation, or his company and its product. I expected a bit more explanation for his position. Also, I'm a bit skeptical of the "refundable credit" for a non-existing service or product. I'd like to hear more about how that's possible.

startupstella 13y ago

we definitely experienced this at matchist, and it has made us waste valuable months. now, we don't build ANYTHING unless at least 3 customers request it and unless it will affect the bottom line (no fancy feature upgrades)

beat 13y ago

Before even delving into development beyond the internal spikes, put together your business model! You should have a pretty good idea who (and how numerous) your customers are, how much they're willing to pay, and how to reach them. Once you have those, you have some revenue numbers. From there, you can extrapolate at least a rough outline of a business plan. If you can't figure out who the customers are or what they'll pay or how to get them to pay, then maybe you're sitting on a nice open source project instead. Lack of a business objective doesn't mean you shouldn't do it, but maybe it means you shouldn't try to make a living from it.

ryanSrich 13y ago
After our first failed startup due to a lack of costumer interest we didn't even touch a text editor until 120 customer interviews. We wanted to be damn sure the problem we were attempting to solve was an actual problem. During this search process we built out our business model canvas making the necessary changes along the way. Each week we focused on a certain section of the canvas and challenged those assumptions against what our customers were saying.

31reasons 13y ago

I think as a Startup you should spend 90% of your time on refining and validating the Problem Definition. Do as much as you can of that activity without even creating a single line of code. Since most probably you are solving a human problem, you should interact with as many humans as possible. Lets be honest, unless you are creating a rocket or some really cool new technology, most Web Services/Apps can be implemented by anyone. YOUR job as Startup is not to reinvent the wheel for the solutions but live and breath the problem definition. After all it will be much cheaper and faster to fail if you have not built the product yet.

tyang 13y ago
This is great.

lifeisstillgood 13y ago

I really think its worth re-reading Venkatesh Rao's "Entrepreneurs are the new Labour" and his dissing of the Lean Startup movement (tldr - it's a great way for in estors to have control / viaibility over many more compliant startups than if entreprenuers really had peer power.) Yes, go validate your assptions, get out of the building. But decide where your exit is, where your talents lie and how much is the opportunity cost.

thornad 13y ago

If you, like a lot of the startups outthere , are going ot make another better shopping, better video sharing, or better... whatever service/product then by all means, do that. But I bet you nobody who ever did anything original did that first. Because by definition if you want to come up with something new and different, people will invariably say No until they can actually touch it and feel it. After that they may or may not say yes, but definitely not before.

noveltyaccount 13y ago

Do folks have experiences to share on validating the idea without giving it away? Isn't there a risk that the if you tell people one of them will take your idea and run with it?

tyang 13y ago
You test your idea on actual customers, you don't tell your idea to HackerNews. And even awesome companies like Facebook screw up when they test by running bad tests. Example: Home. Facebook tested Home on employees who usually use iPhones. Oops. If any of them read Robert Scoble or talked to a single Android fanboy, they'd realize Android is about customization. If a Nexus fanboy likes the Sulia widget or whatever you call it, said fanboy is not going to want to use Home when Home displaces Sulia.
wpietri 13y ago
"Don't worry about people stealing an idea. If it's original, you will have to ram it down their throats." -- Howard H. Aiken I think it's a legitimate worry, but a small one. Novice entrepreneurs overvalue ideas. The majority of startups make major changes along the way. E.g., PayPal was, what, Levchin and Thiel's fifth product? And the real magic to PayPal wasn't money transfer; it was the loss prevention that kept the business viable. The thing that distinguishes successful entrepreneurs isn't that they all had one good idea 5 years ago. It's that they kept having new ideas, and had the drive to push their ideas out into the world so that they could learn enough to spark the new ideas. Practically, there may be a very small number of people who a) are smart and experienced enough to appreciate your idea, b) have more resources to execute, and c) aren't busy doing something they like better. Try not to let those people understand the secret sauce. But those people are hopefully not your customers, who are the main ones you should be validating your idea with.

tyang 13y ago

Replace all: "technical founder" to "founder". Otherwise perfect. A+.

biot 13y ago

A corollary for today's frothy times: 1. Put together team 2. Sell: get acquihired 3. No need to build anything later

Terpaholic 13y ago

It also helps to be your own customer (or in that demographic). I'd suggest that you should have some kind of validation metric for knowing when to continue with the project as well, otherwise a project can drag on for much longer than it should.