Scott Porad

Twice yesterday I had conversations (one in person, one over IM) with entrepreneurs in Seattle who have ideas for startups.  One idea was related to helping bloggers better monetize and the other was related to providing cheaper services to cell phone users.

Both of them come from a product development background—one is a designer and the other a developer.  Both of them were able to eloquently describe for me the product that they wanted to create.

In addition, after a little inquiring, I was able to work with them to effectively articulate the market of people who would be interested in their product.  For example, with the second person it was “people who want e-mail alerts on their cell phone, but don’t have a smartphone”.

With the second person, I had some more time than the first, so I pushed further…here’s a part of our chat transcript:

Me: So, how do we reach these people?  That was the problem with your last startup…you had a great idea, but couldn’t find the customers, right?

Startupper: hmm, reach – I would suppose we’d have to sell it to a carrier, or get an article on Tech Crunch

Me: So often we think about how to make a great product, but often the product isn’t really the issue.  I’m sure, like your last startup, you could build this app great.  The issue is really how to get it in front of the right people.

To me, this seems like a pretty critical sequence of understanding for people who want to launch product companies.  Really a company is more that the product: it’s the product plus the customers.

• First, there is your product—what is it, how does it work, etc.  Most product development types can figure this out, and typically when you go out for drinks with them they have lots of ideas for products.
• Second, there is defining your market.  In other words, who would want this product and how many of those people are there?  I have a few killer product ideas, but there aren’t many people who want them.  That’s not to say they’re bad ideas…they’re probably just bad businesses.
• Third, once you know your potential customers, how do your reach them?  Effectively, this is sales and marketing.  Typically, product development types detest the marketing types as slick, do-nothing, blowhards.  But, it turns out, they have a pretty tricky job which is, “how do I put my product in front of my potential customers in a cost-effective way”.  Turns out this is easier said than done.

This reminds me of a few conversations I’ve had recently.  Yesterday, I was at coffee with Andy Sack and he made the comment to me that one of the most important things he learned as an entrepreneur is the importance of sales.

And, earlier this year I was having dinner with Jeff Sass who made the interesting comment that, paraphrasing, everything is becoming a commodity—hardware, development, even design…everything except marketing.

Finally, Eric Ries said to me over drinks last fall that that startups fail, not because they don’t have a good product, but because nobody wants to buy the product.  I would add my own corollary to that: many startups fail because they can’t find a way to get their product in front of the people who do want it.