A Smart Bear – Jason Cohen on Startups
We have just finished listening to an interview with Jason Cohen on Techzing. We first heard Jason on an interview on The Startup Success Podcast. Jason writes a very popular startup blog , is a successful entrepreneur and founder of four successful companies.
We really enjoyed listening to his views on startups and his real world experience from building his own businesses. There is so much information on startup methodologies however Jason talks in terms of actually applying these concepts. His insightful views challenge many of the norms providing common sense steps to getting your startup off the ground. You can find out more from Jason at his blog and podcast.
Below are some key points from the Techzing podcast. We thought that the ‘sell it first, build it second’ approach really smart.
+ Exponential growth – You can aim for exponential growth but understand that growth will be slow and flat in the beginning due to small starting base.
+ Blogging – Jason tried to conform to blogging best practice and rules but eventually found honest writing works better (proof with his 30k+ RSS subscribers). He wrote better and gained more followers when not worrying about the guidelines.
+ Startup Philosophy – Startup entrepreneurs talk to others in terms of therapy rather than philosophy.
+ Selling Your Startup – It is a difficult decision whether to sell your business. It is not a bad thing to question why you want to sell?
+ Growing Your Startup – Again, it is a difficult decision on how to grow your business. You can chose to grow without employing more people.
+ Evaluating Your Idea or Sell It First, Build It Second
Jason suggests you continue to talk to customers every 3 months to benefit from their insights into your product. He advocates the strength of customer interviews before even building your product.
Approach – Customer Discovery:
Write down your theories and assumptions (20 to 30).
Speak to customers.
Write customer attitudes and your own thoughts down.
Don’t try convince customer, get customer to validate or invalidate theories.
Don’t lead the witness – ask open ended questions to get the truth.
Result will likely be the following validations: Third right, third wrong, third appears while talking.
Pick the top 5 and build your product.
Would you buy it? How much would you pay? Would you write a cheque today?
If you cannot see a clear niche and interest emerging then likely product will not sell.
Jason spoke 50 people (1 hour per interview) – 30 said they would buy the product, 20 actually paid.
He asked the question – Would you write a cheque today?
This approach is not a sales call but asking the questions to get real answers.
The benefit are you can get customers paying before building a product. This is the best signal of validation you can get!
This bootstrapping sales technique allows you to have income on day 1 and aids funding implementation.
+ Finding Potential Customers To Interview – Jason recommended this great cold calling technique.
Begin by searching for experts (who are likely to be your potential customers) on LinkedIn. Be sure to approach these experts honestly, openly, respectful, and be willing to pay for their time. Do not approach this as a sales call but rather a call for help.
In Jason’s experience he found that all people approached were willing to help and for free. If you cannot find people to cold call, this suggests product is going to be difficult to sell.
+ The Business Guy – Jason believes that business guys don’t exist. Business starts by getting leads and getting real things done. They doesn’t wait for development and don’t waste time with things that won’t generate sales.
+ Pricing – backup example: people willing to pay whatever cost when their server crashes
Benefits of paying for sales – mechanical process which you can control. good position to be in.
Blog followers don’t equal conversions – 2 signups from a blog post (30k) and similar result for KISSmetrics
+ Bootstrapping – Jason used early funding from friends and co-founders to build a profitable startup. He demonstrated that company could make money while asking for money. By the time Jason needed some more serious money he found funding from strategic investors easier by showcasing a proven model.
+ Happiness – Doing something that fulfills you leads to happiness. Jason gets great satisfaction from helping others (knowing that others can succeed from mentoring discussions). Discussion often leads to eliciting new ideas.
+ Sell it first, build it second
+ Be honest when cold calling to elicit true customer insight (early sales are incidental but essential)
+ Build a proven model to help raising more funds
+ Doing something fulfilling leads to happiness
Did you listen to the podcast? What did you think? Share your thoughts in the comments section below!
You might also enjoy:
+ Startup Weekend: What to expect? How to prepare?
+ Samsung’s Pivot From Dried Fish to Smartphones
+ Learning From Other Startups – 6 Real Life Stories
+ The Bootstrap Challenge – Walking the Talk
Where to next? Check out a random article.
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