6 Mistakes Of Beginner Wantrepreneurs

hey guys phil smythe zonemaster.com tech entrepreneur and today i'm here to do a little talk about kind of six common things that i see entrepreneurs or beginning tech entrepreneurs failing to understand as an aside i'm not a big fan of the term entrepreneur but it works in the title whatever i think it's a bit offensive so i want to talk about these six points how you can kind of overcome your lack of understanding of them or at the very least when i tell you then you'll be aware of them because i think some of these points people aren't even aware of which is pretty amazing so let's get in to the six points and not drag this out any further point number one is not understanding that the solution that you make has to be five times better than the alternative now yes five times okay is kind of an arbitrary thing to say but the reason i'm saying it like that is that it takes a lot to get people to change and people really have to see a clear benefit you know there's a lot of tools out there these productivity apps and things like that and people think that you know the developers of those think that people aren't using them because they're not aware of them or whatever but the truth is that people aren't using them because they got email they got a spreadsheet and they have a piece of paper and your productivity app just doesn't make a big enough of a difference and they have to install it they have to learn it they have to learn to use it so you have to break their habit so all of these things you really have to come in with something that people go wow i've been waiting for that so think about that you got to be five times better than the alternative kind of following on from that maybe not alternatives is that you have to realize recognize and research the three r's perhaps i'm coming up with something here realize recognize and research the competition you have competition i think there is nobody who's going into something that will have no competition elon musk has competition trying to send things to mars it's i know i meet some people i've met young entrepreneurs here in japan as well even um over the years they're saying i'm like well okay who's your competition they're like oh i don't have any competition i'm making something new it's like you know what if you think you don't have any competition you haven't looked hard enough or you don't really understand what it is you're providing there's a good example which is kind of out of the text base but it's a good example i think anyway you know somebody was talking about how they were going to open an indian restaurant and okay what's your competition they said well i don't have any competition because there's no other indian restaurants in town that's thinking that your competition is only going to be indian restaurants it's not it's any restaurant you know when you're sitting at home pre pandemic let's pretend the pandemic's not happening when you're sitting at home you go what am i going to eat tonight you don't start from the point of what indian restaurant am i going to go to you get to indian restaurant so think about your competition research your competition and by the way competition is great because if you have a competitor that means that there's some awareness in the marketplace you know a long time ago i started this business um called filmomura and that was when i was living in spain and i think i've talked about this before but so i had this you know i had gone to visit friends of mine in uh london england and they had a dvd on their desk and it was like oh yeah we joined the service that you can sign up and you choose your dvds and they send them out to you this is a long time ago folks and i thought wow that'd be great and i was living in spain so i thought you know what i love movies i'd love to have a service like that so i'm going to set up a service like that so i did set up a service like that the problem was nobody understood nobody was thinking uh if only you know i i'd love to watch that movie let's go and rent it online i had to build all that awareness so it's pretty tough so competition is great you know but then you have to get do things five times better so there you go point number three is not understanding how hard it is to do sales and distribution you should assume that when you launch your product despite what i'm going to talk about down in point number six when you launch your product the amount of people who are actually going to care about your product hovers somewhere around zero and you are gonna have to spend either time or money or time and money or some magic trick to get people to care and then you're going to have to not only get them to pay attention you're going to have to onboard them and you're going to have to figure out how to get all of that happening it is hard work as an entre as a developer i should say uh i always think oh yeah you just gotta write the piece of software this is a problem i think a lot of developer entrepreneurs have they think that the product is the thing the product is not the thing because if nobody knows about the product it really doesn't matter to a certain extent how good the product is if you have an amazing store for example inside you know it's a gorgeous and it's got couches and beautiful floors and everything like this it doesn't matter if nobody comes in the front door of course once you're in the front door you have to entice people to stay and give them what they want and all of that but getting people in the front door is really hard be aware of that number four i'm just going down my list here sorry yes i'm using notes i'm old uh number four not understanding what unit i can't even say it not understanding i'm not going to edit this video now you're going to get me in raw and a rambling okay not understanding what unit economics are and the cost of distribution and the cost of acquisition so if you're making something if you have a product or a service or whatever and you figure you know for each customer i can have my service i'm going to talk about services because that's what i do if i have my service and i know that when my i have somebody signed up for me if you know i they sign up it only cost me a buck let's say a dollar a month to support this customer and the customer is paying five dollars a month like man i got four bucks a month from every customer if i just had a million customers i'd be making four million bucks a month but you have to think about how much does it cost you to get that customer if it if you have to spend like seven dollars in ads to get a customer you're only making four dollars on you're actually losing three dollars per customer this is not bad news i'm not saying you want to be in a business where there's zero cost of acquisition because there is no such business but uh you know you don't want to be in a business like that you don't have to strive for that you just have to be aware of it so you know if it costs you a dollar to support them and they're paying five dollars a month you know you can only really spend a couple of bucks to get that person or you have to charge more money so there you go just be aware of unit economics cost of acquisition and so on number five i love this one is that you know have you ever you've done something and your friends are like man that's awesome i'd buy that you know what your friends aren't going to buy it i could have a good example here i wrote a book it's a fiction book it doesn't matter i'm not saying go and buy it though i'll probably put a link in the description down there but i wrote this book and um nobody bought it nobody read it i know a couple of a couple of my friends great friends and i appreciate you they bought it but you know i don't even think my family bought it uh you know so it's you know people will say they're gonna buy it people even if you do a survey and things like this people will say they do it but they won't most of them so it's easy to answer a survey it's hard to put down your credit card whether they're a friend or a stranger so be aware of that you know your friends are not going to be customers more likely than not and to be honest your friends are going to want it cheap too so final one let me get a drink of cold coffee here final point is before you launch you want to de-risk you want to it's like de-icing a plane before you take off you want to get rid of any chance or no i was going to say you want to get rid of any chance of failure but that's stupid because if you have the business of course you have a chance of failure you want to reduce the basic chances of failure by doing something before you launch you know that's what the beauty of kickstarter is people think that kickstarter is a great way to launch but it's not it's a great way to find out if people are actually interested and willing to put down some money you know do i say you know a lot i think i might um when i was young back when we were making actual software that you sold on floppy disks or cd-roms if you're fancy we had this concept called vaporware and i remember being in a car driving with uh guy kawasaki it's true story and he was talking about the beauty of vaporware and that you can tell people they're gonna you're gonna build something and launch something and start charging money for it make it an exclusive club and you can gauge you know whether this idea is going to fly or not this is back in the 1980s by the way whether this idea is going to fly or not but more important than that perhaps is that you can see if it's not going to fly what tweaks you can make or even complete pivots you have to make to get that idea out there to be honest if you have an idea whatever you might think you're probably not that unique of a person so if the idea is interesting to you there are probably people who the idea is interesting to so you have two things you can either work hard to find those people which you're gonna have to do so you're gonna try to find those people and maybe tweak it a little bit just because maybe more people are interested in this kind of version or that kind of thing or as you're developing it you might say wow i never even thought about this feature and blah blah blah so you know you have to de-risk pre-launch okay i hope this is helpful these are just my ramblings i'm leaving this video like this because that's just the way i am and i'm just i don't want to cut it down too much so if you like these kinds of videos why don't you like and subscribe however that is underneath the screen you can hit the bell notification so when i put out videos i don't put out a lot of videos but i'm trying to do more but i go like this you know because i'm busy um but if you're a tech entrepreneur especially if you're interested in ruby on rails i'm probably going to be doing some interesting ruby on rails content like subscribe and i'll see you soon

Channel: Phil Smy

Views: 364

Keywords: ruby on rails, learn ruby on rails, software as a service, saas business, how to create the perfect saas business, tech entrepreneurs, entrepreneur, become an entrepreneur, become an entrepreneur motivational video, be an entrepreneur

Id: wQeDtWuPOgo

Length: 12min 25sec (745 seconds)

Published: Sun Dec 13 2020