Start Up Blog

4 factors for webpreneurs – Guest Post

Posted in entrepreneurship by Steve Sammartino on December 30, 2010

1. Technology is easy – getting customers to pay you is outrageously difficult.

When was the last time you heard about a web startup failing because the product didn’t work?  Almost never.  With the greatest respect to all the hackers and engineers out there coding away, making a product do what you want is simply a function of time.  Spend enough development time on it, and you can write code to do almost anything you want. Getting a customer to pay you some money for that feature you just added? That’s an entirely different proposition. The vast majority of web startups fail because they don’t find enough customers, at the right price and in enough time before they run out of cash.  If we spend as much time on marketing your startup as you do on writing and shipping your code, and we just might beat the odds.

2. Customers can always choose to do nothing

When pitching a prospect we are generally trying to convince them to do one of two things:
(i) Leave a competitor and join you
(ii) Stop doing nothing about their pain problem and join you

Who knew that getting them to leave a competitor was often easier than getting them to stop doing nothing? At least if they are using a competitor they recognise that they have a problem that needs solving! The truth is, many prospects are indecisive, stagnant, glacial, apathetic, unwilling, and unmotivated.  Demonstrating your product and then asking for the sale is just as likely to be met with a yawn and a scratch of the arse as it is with a chequebook. If you understand how difficult the process is, then there is a good chance you will approach it with the right amount of preparation and effort.

3. Financial models are fantasy
Their is one good reason to construct a financial model prior to having any real customer data.  Do it to prove to yourself that the fundamentals of your model will produce a profitable business over time.  Think of it as a sanity check. Once you are happy that the model works in theory, throw the spreadsheet away.  Never look at it again, and for christ sake don’t go out and try and raise investment funds off the back of it (guilty as charged!). Just launch your product and get as much real live data as you can.  Months later you can giggle about how wrong your projections were, but at least you won’t be making life altering decisions based on nonsense.

4. There is no replacement for quality user testing

User testing pays for itself many times over.  This doesn’t mean getting your mates over to play with your creation in return for a 6 pack.  It means getting real life customers/strangers to use your product while you watch. True story.  Our startup is an online event registration solution that allows customers to sell tickets and accept registrations for any sized event. Three months after launch, we sat and watched via web cam while a Canadian tester spent 15 MINUTES just trying to create an account. In one of our releases, we had cannily decided not to display a “register button” to anyone using Internet Explorer.  No-one using this browser  could get in and use our product, and it had been that way for over a week.  He eventually managed to get in, but man was he pissed!

What else do you wish you had known before you did your own web startup?

Post by Scott Handsaker founder of Eventarc

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10 steps to web start up

Posted in entrepreneurship by Steve Sammartino on June 2, 2009

It’s never been cheaper to start a business in the history of man. Especially on line. Startup guru Guy Kawasaki proved it with his $12,000 example for www.trumours.com – But startup blog says you can do it for pretty close to zero. In the spirit of sharing here’s the startup blog list of the 10 things you need to get started, and resources to help perform these necessary tasks.

  1. Idea generating – Ideas these days are free and omnipresent. Steal ideas from www.springwise.com or www.idea-a-day.com – Just take one that suits you and do it. Maybe bring their idea to your geography, or just copy something already successful and do it. There is no currency in ideas. They are free. Take them. Any successful entrepreneur will tell you that is the easiest part of any venture. And they are right.
  2. Name Generating – Actually your business name has nothing to do with success. There’s only two things to consider. Firstly that it’s available (.com?) and secondly that people can say it. Check out www.nameboy.com to help you generate some.
  3. Idea testing – I loved the idea from Timothy Ferriss who tested the idea for the best book name (4 hour work week won it) by using Google Adwords for the various options and seeing which one got the most clicks with certain key words. Inspired stuff. Steal his idea and use adwords to test your business proposition before investing heavily.
  4. Project Managment - Keep your project stuff all in one digital location. The crew over at 37 Signals provide some awesome tools for free in doing so. We’ve used it extensively for rentoid.com
  5. Communication – Get skype set up for all your international dealings phone calls and chats required in managing your project and team. I work with with people all over the world on rentoid and have never paid for a phone call yet. You can even get it on your iphone to make free calls from – Giddy up.
  6. Design – Don’t get stooged paying a zillion dollars for an agency to design your stuff. Leave the agency work for big companies with big budgets, you’re a bootstrapper and need to get it done cheap. But lucky for us these days cheap doesn’t have to mean crap. Check out 99 designs to get your site designed. If you need digital icons or related visuals check out istock photo for great up to date design. For pictures use Flickr creative commons.
  7. CSS (Cascading Style Cheets) – Check out slice and dice it to get your shiny new designs ready for coding.
  8. Coding / Programming - Yep, that tricky stuff which makes it all work under the website. Easy, go straight to Elance or ODesk to find coders for HTML, PHP, Rails, AJAX – anything. They’re all there waiting for your brief. (this should be the only biggish expense for your web startup – which means a few hundred dollars with a currency advantage)
  9. Payment gateway – Use paypal – free set up and the cheapest, most trusted way to accept credit cards and multiple payment forms on the internet.
  10. Promotion tools –  OK this is the stuff you’re all familiar with and using daily. So turn these fun parks into business tools by using them properly. But just choose a couple of them and use them well. My favourites are youtube, twitter, blogging (recommend wordpress).

So there you have it – web start up in 10 easy steps. Feel free to add any other cool tools and ideas in the comments.

What are you waiting for? Get started.

Steve.

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