create consumers before you search for customers

Normally I don’t write blog posts during “business hours”, blogging isn’t in my job description and this is a personal forum. I usually wait until the evenings or weekends which probably explains why I don’t write as often as I might intend to. Sometimes however something crosses my inbox that makes me drop what I’m doing and start typing.

via @andrewchen

Andrew Chen always has great blog posts, but today’s post really hit me. His point, that spending valuable startup time (meetings, planning, engineering sprints, etc) focusing on the business model too early is the exact wrong thing to do.

Some people might label this as more “get big fast” thinking, a holdover from different startup bubbles where the issues of revenue were given a back seat to branding and promotion. It’s not. The most important thing a company can do is find a way to engage millions of consumers before it tries to turn any of those people into customers (if it ever does).

That’s not to say that all businesses should be B2C, but instead that creating a product which delights and engages your users (whether they be CIOs or 11 year olds) is the most important thing a startup can do. Nothing else matters in the first weeks, months and potentially year (or more) of it’s existence. Defining what problem you want to solve and getting your product out into the market where real users can give you immediate feedback is far more important than figuring out pricing models or ad rates. Rapidly innovating based on market feedback faster than your competition is more important than any quarterly revenue number.

This point echos a quote from Chris Dixon that I posted to Clipboard today. The most valuable thing a startup can do is create a great experience. Competing on price is a waste of time when it’s too easy for your competitors (current or future) to move to free products. Focusing on sales channels and revenue are misguided if your product doesn’t excite people.

Utility will only get you so far in a world where people demand simplicity.

Andrew mentions that we live in a world where getting to 100 million users is realistic for a lot of products. For years that wasn’t the case, though I have been lucky enough to do it twice (as part of the Windows 95 team and later as head of the RealPlayer group at RealNetworks). You don’t need to be an operating system, a browser or a media player utility to hit the magic 100 million user mark. I joined Korrio because we have the opportunity to do it.

Getting to scale where the business model issues become secondary, or even trivial, is the challenge now, which make it a great time to build new products.

Published by Steve Banfield

Kentucky born, Seattle based. Entrepreneur. Team Builder. Photographer.

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