Your Business Idea Sucks. Here’s Why You Should Do It Anyway!

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Written by: Tina Cannon

Like most entrepreneurs, I thought my “napkin” idea for PetsMD was perfect.

I had a sick dog one Sunday evening and needed some pet health information that I could trust and written so that I could understand it. What I found was everything from goofy blogs on random ailments to Web sites that I would have needed a science degree to understand. So my co-founder and I set out to create a pet health resource that all pet owners could understand and trust.

Being a complete novice to the Internet space and a first-time startup founder, I needed a little guidance. Lucky for me I was accepted into an incubator program. After 10 weeks of intense mentorship, I was surprised to find that my business idea had changed completely: I went from being an information and content-focused company to a software business specializing in online veterinary appointment booking.

Never in a million years did I think I would run a software company and sell to this particular audience. It took time and money for me to understand that sticking to my guns and pushing against the natural evolution of the company was not the right way to go.

 

Knowing what your customers want

So why did my original idea suck? Well for starters, I had too many ideas on ways to monetize the site: First we were going to be about content and ads, then products, then subscriptions… and the list went on and on with no focus. Lesson learned, I needed to hone in on a real revenue generator. After meeting with my mentors, we narrowed our focus to one revenue model. As one mentor put it, ” you never have a shortage of ideas, just focus and execute on one!”

So armed with that direction, we set out to learn from our users and potential users exactly what they wanted to see us develop. After all, your idea still sucks at this point until you hear from people who are actually ready to pay you money for it. We set out to talk to 50 pet owners to find out exactly what their pain points are on a daily basis. After many a conversation with potential buyers, we created software that would solve their problems.

They wanted more than what we were offering — turns out they wanted us to both help them find the right product and to guide them to a veterinarian. Then we flipped the table and spoke to as many vets we could gather to find out their pain points. We had a match! They desperately needed a way to manage the front-desk chaos, reach new clients, retain existing clients, and measure their ad dollars.

 

The big pivot

We started this company with an advertising-based business model in mind. In a few short weeks, we completed transformed into a software-as-a-service, or SaaS, business model. Our customers changed from advertisers and pet owners to veterinarians who wanted appointment-booking software. We never thought we would end up where we are today, but most entrepreneurs say the exact same thing.

If we hadn’t received the direction that we did, we probably would have built the company like a spec house, based on everything we thought our customers wanted/needed. Finding out what people need and what they are willing to pay for first makes so much more sense — and it saves you a lot of time and money. Plus, it lets you approach potential investors with financials that are based on real figures, which they love to see.

 

A little piece of advice

I’m just going to say it, in case no one else is willing to say it for you: The idea in your head or scribbled on a napkin is probably crap. But go ahead and pursue it anyway. Your idea will change and it may at some point barely resemble the one that first gave you inspiration. That’s how you find out what you’re really about.

Companies evolve and your ideas will fail, but great companies leverage that failure into a successful concept  and if they need to change strategies, they do it quickly. This is the real competitive advantage that a small start-up has over “the big guys.” If a company like Apple wants to change even the package their software comes in, it’s a logistical nightmare. A start-up is agile by definition, so use this to your advantage.

Be flexible with your ideas, and get new ones as often as you can from your users, your staff, and your friends. If you’re open to failing, then the process will reward you in the end.

 

There really is no instruction manual for starting up a company, but if all else fails, try a variation of the directions you see on the back of shampoo bottles: “Try. Fail. Repeat.”

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by: Tina Cannon, previously written and published for CBSnews.com

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Need Startup Funding? How to Get Friends and Family to Invest

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By: Tina Cannon

When I was talking to a room of aspiring startup founders the other day, I asked how many of them are looking for funding for their company. Ninety-nine percent raised their hands high in the air with pride. They probably thought I was offering money. “How many of you have a great idea?” I asked. I know, this was kind of a softball, but they ate it up. Most hands stayed high in the air. Then I asked, ” How many of you asked your parents for money?” About 80 percent of the hands dropped. So I said, “Well, if your parents won’t invest in you then why the hell should anybody else?”

After a few round table chats, I learned that many of the entrepreneurs in the room just did not know how to approach their friends and family. It felt weird or uncomfortable. That is when I told them about my recent social-giving experiment a la Facebook and how I raised about $3,000 in two weeks.

The Hypothesis:
In every experiment, one needs a hypothesis to prove or disprove — at least that is what my science teachers drilled in my head. So, for this experiment I tried to prove that, “If you just ask your friends and family to believe in you, they will.”

The Experiment:
I to wanted to see if the traditional friends and family route would really work but I thought I’d try a nontraditional way of asking them. I set up an “event” on Facebook and linked it to EventBrite and PayPal. I called the event, “Help an Entrepreneur Out” and set three levels of payment options ranging from, “Yeah, I am living the dream” ($500 donation) down to “I feel ya, here’s dinner on me” ($50 donation). Then I went crazy and left an open amount option as well. I then posted the event link to my Facebook page for all of my connections to see.

The Results:
Shortly thereafter, I received a few calls from loved ones and I quickly explained that no, I was not on the verge of homelessness, but rather was hoping that they, too, believed in my company and had a few dollars to spare. In about two weeks I raised $1,000 and by the third week nearly $3,000. Then I turned off the event and quickly refunded folks who were so kind to donate to my cause. A few donors who really believed in what I was doing and wanted to support my entrepreneurial dream insisted that I keep their money.

Hypothesis proved.

I am sure there are easier ways to do this in your own life. Perhaps just call up Mom or Dad, the in-laws or even a cousin. If your own family won’t invest in you, then maybe you need to take a hard look at your concept to make sure that your good, sound idea really is just that. Let them be your sounding board –besides it is good practice for future investor meetings. If you are going to fall flat then better to do it with family by your side.

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