14 March 2012 ~ 2 Comments

Starting a business for the right reasons

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I hear that all the time.

I want to start a web application/mobile application/business. I just don’t have an idea yet.

Rob Walling explains in his book “start small, stay small” (yes, that’s a book I quote often around here. You should get it), that there are good and bad reasons to start a business. The most common bad reason is to have a product idea and make it a business.

Now it sounds very counter-intuitive so it might need some explaining.

The project/product confusion

Especially if you’re a software developer or just not acquainted with marketing, you probably have a somewhat skewed vision of what people want and are willing to pay for. You think you have a product while in reality you have a project. A product is a project that has a market. Your fantastic original idea might well have only you as potential market. So if you have an idea for a product, chances are you’re experiencing project/product confusion.

What’s a better way to start a business then?

Rob suggests to start with the market, and work towards your idea backwards. It defeats the traditional notion of “having a great idea” but it’s also good news: it means there’s a process that can be executed. It doesn’t mean creativity is out of the window, but it means you don’t need to sit on your butt waiting for the epiphany. The problem is, very few people do that, because we tend to do things we’re familiar with. So software developers tend to write code for yet another todo application that nobody needs. It’s already hard enough to start a business, so why would you shoot yourself in the foot?

What would this process look like?

  1. Make a list of markets that are easily accessible to you (for example, markets you’re part of, or one of your friends is part of)
  2. Select the ones you’d like to work with (for example, SEOs or tennis players)
  3. Go talk to people in these markets
  4. Create a product based on their feedback

It’s also related to customer development principles and the lean startup movement. You shouldn’t be coding in your basement for months and then hope that people will come and magically buy what you did. What are the chances of that happening? Yes, if you follow this process, you won’t work on yet another todo list application. You’ll make something real people are asking for, not something your brain has created out of thin air.

Final words

If you’re shooting for the moon (trying to invent the next Facebook) all this doesn’t apply. But if you are shooting for the moon, why are you not buying lottery tickets then? You’ll have more chances to get to the moon.

Congrats! You made it until the end. If you liked it, you should follow me on Twitter or subscribe to the RSS updates.

2 Responses to “Starting a business for the right reasons”

  1. Wassim 15 March 2012 at 6:53 pm Permalink

    Really enlightening! I’m one of those trying-to-be-coders. Trying to be a good coder took me every bit of attention and I woke-up with no distinction between a Project and a Product. I know something about the subject; I’ve launched two fiascoes ;-)

    I like your blog. Keep it up.

  2. tommy 15 March 2012 at 7:12 pm Permalink

    Hey Wassim, thanks for stopping by! I think most software developers have been there before, but it’s good to have realized it. I take it from the name of your blog you’re a fellow HNer ;-)


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