How to Build a Million-Dollar Business
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How to Build a Million-Dollar Business
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Re: How to Build a Million-Dollar Business
#2Sounds simple and... it sorta is. If you spend some time learning about sales, you'll recognize the "rejection is good - it's one step closer to the next yes!" theme.
In this vein, I want to recommend "Ready, Fire, Aim" by Michael Masterson. It focuses on the same topic (selling subscriptions to information products) but the ideas can be applied to most product businesses. The focus is on getting those first sales, figuring out how to convert, then fleshing out the product.
Re: How to Build a Million-Dollar Business
#3This advice may be good for someone selling a commodity, but for software, it doesn't make sense to me.
Basically, OP says to sell a large volume of a commodity product to many customers. Since you only convert 1% of your prospects, you'll have to do a lot of pitching. (100 * a large number = a really large number).
Sounds like you'd be selling all the time with no time left for programming.
I'd suggest exactly the opposite: Spend almost all of your time building a great product, and do one of two things with it:
1. Make it a niche product and sell it to a small number of tightly targeted customers. Your conversion rate should be much higher than 1% and you can charge much more, not needing so many customers.
2. Make it a web-based commodity and leverage technology (SEO, blogging, etc.) to reach a large audience. You don't "pitch" thousands of users, you just reach them and let your product pitch them for you.
I just don't understand how someone who can program (which is the critical path for software products) should be spending all of their time selling.
Re: How to Build a Million-Dollar Business
#4Baloney. If growing a business was so predictable there would be absolutely no place for startups. that's the sort of intellectual fraud Taleb refers to in the Black Swan.
Re: How to Build a Million-Dollar Business
#5Its a good reminder that you have to sell, sell, sell.
But his example that your selling an email newsletter with valuable information, leaves you wondering when you have time to create the newsletter. If you actually did have time to talk to 100 prospectives a day, you would have zero time left for anything else.
A better representation might be: say you have what it takes to research and put together a very compelling newsletter that you can charge $25 a month for. Now lets say, your wife is also at home unemployed and you both magically can last a year trying to bootstrap the business. You bust your butt creating the product and your wife makes 100++ phones calls a day. Sell, sell, sell.
Re: How to Build a Million-Dollar Business
#6This advice may be good for someone selling a commodity, but for software, it doesn't make sense to me. Basically, OP says to sell a large volume of a commodity product to many customers. Since you only convert 1% of your prospects, you'll have to do a lot of pitching. (100 * a large number = a really large number). Sounds like you'd be selling all the time with no time left for programming. I'd suggest exactly the o…
"You don't "pitch" thousands of users, you just reach them and let your product pitch them for you."
These are the same thing. Just because you're not taking each potential customer to a steak dinner, it doesn't mean you're not selling them. I don't see how you get customers without showing them the benefits of your product. No matter what the medium is (blogging, advertising, interviews, SEO) - Pitching, selling, it's all the same thing.
Re: How to Build a Million-Dollar Business
#7This advice may be good for someone selling a commodity, but for software, it doesn't make sense to me. Basically, OP says to sell a large volume of a commodity product to many customers. Since you only convert 1% of your prospects, you'll have to do a lot of pitching. (100 * a large number = a really large number). Sounds like you'd be selling all the time with no time left for programming. I'd suggest exactly the o…
"You don't "pitch" thousands of users, you just reach them and let your product pitch them for you." These are the same thing. Just because you're not taking each potential customer to a steak dinner, it doesn't mean you're not selling them. I don't see how you get customers without showing them the benefits of your product. No matter what the medium is (blogging, advertising, interviews, SEO) - Pitching, selling, it…
From OP:
"I talked to 100 clients last week and got 1 client."
"Let's try for 500 clients this week. 100 clients per day is more than doable," you tell yourself.
"I'll up my calls to 150 per day, and direct mail the rest to reach 2000 contacts this week."
"2000 contacts produces 20 new clients."
I dunno, "talking", "calling", and "direct mailing" in volume sound significantly different (and way more time consuming) than SEO, mass marketing, and word of mouth. Just different enough that a programmer can make time for the latter but not the former.
Re: How to Build a Million-Dollar Business
#8This advice may be good for someone selling a commodity, but for software, it doesn't make sense to me. Basically, OP says to sell a large volume of a commodity product to many customers. Since you only convert 1% of your prospects, you'll have to do a lot of pitching. (100 * a large number = a really large number). Sounds like you'd be selling all the time with no time left for programming. I'd suggest exactly the o…
Mark Cuban says sales solves all problems. I think he's right. The company with the best sales (not the best product, best SEO'd website, most informative blog, etc.) will probably have the most success. Doesn't mean you have to cold call.
Re: How to Build a Million-Dollar Business
#9This advice may be good for someone selling a commodity, but for software, it doesn't make sense to me. Basically, OP says to sell a large volume of a commodity product to many customers. Since you only convert 1% of your prospects, you'll have to do a lot of pitching. (100 * a large number = a really large number). Sounds like you'd be selling all the time with no time left for programming. I'd suggest exactly the o…
Mark Cuban says sales solves all problems. I think he's right. The company with the best sales (not the best product, best SEO'd website, most informative blog, etc.) will probably have the most success. Doesn't mean you have to cold call.
To boil it down more, it's customer acquisition costs (CAC) and lifetime value of the customer (LVC). Great products help drive down the CAC and increase the lifetime value of the customer. Sales are great and an often overlooked aspect, but just one piece of the puzzle. You can have an awesome close rate, but if the product sucks and they leave, the LVC goes to shit. You can do a ton of sales as well, but if the cost to close those sales and acquire the customer is too large, you become unprofitable.
Re: How to Build a Million-Dollar Business
#10Baloney. If growing a business was so predictable there would be absolutely no place for startups. that's the sort of intellectual fraud Taleb refers to in the Black Swan.
Three cheers for calling this article what it is!
Quoting from a comment I made previously:
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A good friend of mine described the articles displayed here as a "rat's nest" which does not lead anywhere. At first, I thought he was crazy; then I began critically looking at said articles.
I signed up here looking for what the original post posits providing; what I found were articles about startups, business, marketing, the current/next great gold rush, followed by the token (recently it has been improving) programmer/hacker article. And the articles about startups, business, and marketing were not great on any scale; in fact upon critical review, said articles advocated rather bad strategies. Strategies which amounted to little more than legalized scams, strategies which optimize for the short term, strategies promoting win at any cost, strategies which advocate me first and to hell with the consequences; in short, strategies of which Phineas Taylor Barnum would have been proud.
Before joining the Hacker News community, I was interested in starting my own business. Now that I see what is advocated as "startup culture", I want nothing to do with starting a business in the United States (because my conclusion is the culture and laws of the U.S. have optimized for short term gain, with the resulting push towards the strategies mentioned earlier). What happened to a business (either startup or established business) having integrity in all of their relationships, being a responsible citizen of the business ecosystem it operates within, and providing a legacy beyond the generation within which it was founded?
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So now here is my dissenting opinion of the linked article: if all you are concerned about is the money, then you have already lost.