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• Why is validation important?
  • How to launch a product, v1.0
    • 1. Find an idea
         • Talk to people
         • Go out on the internet
         • Or you can’t find a tool to do something
    • 1. Build the product
    • 1. ???
    • 1. Profit
  • THIS DOESN’T WORK
  • Why?

• The biggest risk / difficulty isn’t building the product, it’s finding the customers

• • • Those 4 steps: you’re deferring the risk - Deferred risk is like technical debt
      • You build, you put it out there, and then things turn against you
      • Your response to why?
        • “Because it’s the beta”
        • That’s not right at all
        • It’s because you’ve deferred the risk
        • Deferred risk only gets worse as time goes on
    • How to launch a product, v2.0
      • 1. Find an idea
      • 1. Talk to customers
           • 😮 CUSTOMERS?
           • I want to sit behind my keyboard. It doesn’t yell at me
      • 1. Ask them questions
           • Find out what’s important to them, and why
      • 1. Get commitments
      • 1. Build the product
      • 1. Profit
    • Instant Cashflow by Bradley J. Sugars
      • You find out what people want, you go get it, you give it to them. In that order
      • The problems your product solves are not necessarily the ones customers are interested in solving
    • Pizza
      • Fulfills a need (hunger)
      • Would you buy a pizza, then bring it in to everyone, and then charge people $10 for a slice?
      • Every told your kids what’s for dinner and then asked if they want it?
        • They might even tell you what they want, and then not want it when you put it in front of them
          • They’ve asked for a solution that doesn’t really solve their problem
• Built a tool to solve a problem a client had with Excel spreadsheets
  • Put a landing page online to see if I could sell it
    • Was very difficult to find customers / get people to talk to me
    • The customer development being difficult meant that growing the business would be difficult, too
• Had a problem doing event sponsor follow-up
  • Could turn into a product
    • Ran ads. Didn’t work
    • Went to my network
      • Only one person even said “I think I would pay for it”
    • Knew that wasn’t going to fly
• Bluetick.io
  • Presale results
    • Pre-code
      • Nov-Dec
      • 11 prepayments
      • $600+ MRR
      • $1,480 in revenue
      • Before a single line of code
    • Within 5 months
      • 20 prepayments
      • $1k+ MRR
      • $2,645 in revenue
      • No marketing at this point. Organic word of mouth
        • Good indicator
    • The length of time here is important. It’s not an overnight process
• Identify people to speak with
  • Where?
    • LinkedIn
    • Twitter
    • Facebook
    • Forums (vBulletin, phpbb, Discourse)
    • Paid ads – not ideal, but can be used
  • Start with warm leads. People already in your network
    • People who will give you the time of day
    • If you can’t find people in your network, it’ll be exponentially harder when you try to find them cold
  • Having a huge audience doesn’t matter
    • Seen people with 10k subscribers where 5 of them say they’re interested
  • People who…
    • 1. You know
    • Then people who 2. Know you
    • Then people who 3. Will introduce you to people they know
    • Then people who 4. Have no idea who you are
    • Can hone your messaging as you talk to each group
  • Most people don’t even talk to people
    • Or they talk to 3 or 4. They don’t go to friends of friends
• Validating the idea
  • Not the same as validating the customer
    • Are you actually solving a real problem?
    • If your main competitor is Excel, you probably don’t have a great business model
      • Because everyone you talk to already has that
      • Hard to compete with
    • Initial contact to pitch the concept
      • “I have a question for you. I’m in the process of validating a new business idea and thought it might be applicable to you. No worries if it’s not, but if it’s a problem you’re having, I’d love to get on a Skype call to discuss in the near future.”
      • “As of right now, I’m simply trying to validate this idea and have conversations and get verbal commitments. If I reach a critical mass of people interested, I’m going to go back to those people with mockups & an implementation plan, get financial commitments from people and start building.”
      • “Does this problem resonate with you? If so, let me know and we’ll set up a time to chat. If it doesn’t resonate, do you know of anyone who might be having this problem that you’d be willing to introduce me to?”
    • First call
      • Important to get on a call / Skype
        • You hear their voice
        • Intonation
        • Pauses
        • You hear them say something and then say “let me take that back-“
        • People are more meticulous when sending email. Less authentic
      • 15-20 mins
      • Recording it is useful
        • You can tell them, or not. Whatever you’re comfortable with
      • “How are you solving this problem today?”
        • Gives you an idea what they’re doing
        • What other tools are out there
        • If they don’t have any solution, it presumably isn’t that painful
        • If they’re paying for something to solve it, that’s some validation
      • “What have you tried?”
      • “What worked? What didn’t and why?”
        • Tells you what’s lacking elsewhere
      • “Would you pay for a tool that solved this problem?”
      • “Can we have a follow up call to discuss this further?”
        • Helpful disqualifier; data point; if they don’t want to talk more about solving it
      • “Do you know of anyone in your network who might have a similar problem?”
        • Ask for 3
        • I got 5 from somebody, complete with introductions
        • Can give them a template to pass on
          • Summary of who introduced you, what the problem is you’re looking to solve, ask if it resonates
• Find out what they want. Go get it. Give it to them. In that order. MAYBE…
  • AuditShark
    • Sometimes things do not go as planned
      • I spent 2 years and $50k on building AuditShark
      • I had better domain knowledge than anyone
      • Had prior connections
      • Long story short… did not work out
    • “An MVP is not a minimal product. It is a strategy and process directed toward making and selling a product to customers.”
  • Bluetick
    • Demoed it with…
      • Built Balsamiq mockups of every screen
      • Google docs, and spreadsheets
      • A lot going on
      • Wanted to demonstrate all of that
    • Because didn’t want to make the same mistake again. Wanted people to know what they were getting
    • Didn’t want to waste time – it’s the most valuable resource we have
• During the demo
  • Look for disqualifiers. Reasons why you shouldn’t waste your time building it
  • Record the audio
  • Write down every question
  • If someone asks for something. Don’t say “I can do that”. Ask “Is that important to you?”
    • Amazing how often someone will say “Nah, I was just asking”. “Not particularly important”
  • Actively overcome objections. Remember this is a sales demo
  • You don’t have to build a 90 page deck like I did for Bluetick
  • Ask for the sale!!!
    • Ask them to pay for it
    • Huge difference between “would you pay for this?” and “will you?”
      • I had a bunch of people (about half) fall out at this point. A little concerning
    • Payment form
      • I chose to leave the price box of the form blank. Asked what they wanted to pay, and how many months they wanted to prepay for (between 1-6, defaulted to 3)
        • Everyone but 2 payed for 3 months
        • One person: $100/mo
        • Two people: ~$40/mo
        • Everyone else $47-50/mo
        • Eventually fixed it to $50/mo as a result
      • Charge them immediately, with a liberal refund policy
    • Prepayment disclaimers
      • Not all demos will convert to sales, even if they said yes before
      • Some prepaid customers will ask for refunds
        • Sucks, but it’s ok
      • Not all prepayments will convert to paying customers
      • The money is a proxy for a vote of confidence
        • It’s not a guarantee
        • But it’s way better than nothing
• “Good customers”
  • Are currently solving (or attempting to solve) the problem
    • If they’re not, you now have an education problem as well as a product problem
  • Experience the problem on a recurring basis
  • Use the product regularly
  • Will achieve far more value than the time and money it costs
  • Will pay you to solve their problem
• Validation mistakes
  • Targeting the wrong people
    • If you’re not talking to the decisionmaker, it’s going to be difficult
      • Low purchase amount to someone lower down with a credit card, may be OK
      • But needs to be someone with authority to make the decision
    • People who aren’t actively making an effort to solve their problem
      • You don’t want to be educating an entire audience
  • Prepaid customer myths
    • “It means you’re doing the right thing”
    • “They’re paying for a solution”
    • “It’s the same as if they’re paid customers”
    • “Being your guinea pig is a priority for them”
  • Thinking you’ve promised them you’ll build it. If you don’t end up building, you refund, everyone will be cool with it
  • Offering an indefinite beta period until it provides them value. Put a timeframe on it
• The lies we tell ourselves
  • “It’s not done until it ships”
    • You can totally charge before you launch
  • “Can’t launch until certain features aren’t done”
    • The password reset doesn’t work? They’ll tell you. It’s not the end of the world.
    • You can do things manually
    • You can put the button there. Measure if anyone clicks it. If they do, tell them it’s not ready yet – ask if they’d like it
  • “Can’t launch, I don’t have enough traffic”
  • “I don’t have time”
    • Nobody is too busy, it’s all about priorities
• Most of the things in your life that are worth doing are scary
• Things are trending upward with Bluetick, but it’s not definitive yet
  • Cautiously optimistic
  • It can be a very slow path
    • “The long slow SaaS ramp of death”
    • There are exceptions
  • No silver bullets
  • But aim to win
• @SingleFounder
• https://www.bluetick.io
• mike@singlefounder.com
• Resources
  • Balsamiq – 4 months free of Balsamiq Cloud for everyone in the room
  • WP Simple Pay Pro – 50% off a 3-site business license for everyone in the room
  • Email scripts from Bluetick – http://bit.ly/mc17se-emailscripts
  • Single Founder Handbook – free for everyone in the room
  • Start Small Stay Small – free for everyone in the room
• Q&A
  • “Asking for pre-sales. Would you do it differently if the monthly price were higher? Say, $800/mo”
    • You can absolutely do it with that approach. I’d lean more towards invoicing at that point. People have absolutely used this methodology to take prepayment for high ticket items
  • “Did you send those initial pre-customers your first attempt at a prototype?”
    • I ask them whether I can add them to the email list at the time
    • You can email them and ask if you can add them
      • A no is actually a good data point to have
  • “Balsamiq. How much are you iterating from call to call?”
    • Depends how many minutes I have between each call!
      • A couple of calls even went 2 hours long
        • One was actually a competitor. But we figured we’re not really in competition, we’re in it together against the bigger guys. If you’re in a situation like that with someone in this room, I’d recommend treating it similarly
    • If it comes up several times, you can talk around it

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