Why do so many entrepreneurs insist on spending precious time and money on systems that are designed to scale a business, when they really haven’t even started their business? When I make that observation a lot of “entrepreneurs” shake their head and say, “What do you mean? I started my business last year.” Here’s the hard truth. A business only becomes a business when you have paying customers, and not just one or two.
Here are just a few examples of things that early stage entrepreneurs routinely drop their money on before they have paying customers.
- How to create lead magnets
- How to build your email list
- How to use Facebook ads to land new customers
- How to create an online course and of course create that all desirable passive revenue
- How to run webinars that convert
- How to grow your social media following in three easy steps so you can kill it just like they are
- How to get booked on podcasts
- How to run a mastermind and make money doing it
- How to become a much in demand public speaker
- And on and on.
Honestly there is an almost infinite number of places where you can spend your hard earned money. Here’s the thing. If you’re relying on these systems to get you your first five or ten customers, you’re going to be very disappointed.
Call me old fashioned, but would it not make more sense to confirm that people are willing to pay you for your new product or service before you spend all this money? People seem to think that the combination of the internet and all of the above mentioned systems will magically take away the need to test and validate your product or service. Well, guess what? It doesn’t. When you skip that step, you’re just speculating that you have a solution to a problem that customers are willing to pay for. And that’s why so many small businesses end up in this vicious loop of thinking they just need to pay for one more system or one more quick fix or one more tool and then everything will suddenly click. When that doesn’t happen self doubt creeps in and before you know it a lot of these businesses fail.
Look, there’s only one way for you to validate that you have a solution that customers are willing to pay you for. You have to have real person to person conversations with people. I know it’s scary, but you can’t skip this step. In person meetings, video calls, or even a phone conversation (if anyone still uses their phone for audio conversations anymore). It’s the only way you will be able to:
- Confirm your understanding of the problem
- Get a sense of how bad the pain is for your potential customers
- Learn how they’re currently solving the problem
- And confirm that they’re willing to pay to have that problem solved.
If you’re selling a physical product build a prototype or minimally viable product. If you’re selling an app, build a basic version to show potential functionality. Your goal is to show potential customers what you have in mind and to get their feedback. If you’re selling a service, then test it. Even if that means providing the service for free to a few people or at a heavily discounted price. You need to figure out what works, what doesn’t work, and what needs to be changed. Then it’s time to look for your next client.
Once you’ve done that five or 10 times then you’re ready to look at ways to automate and grow your business. Business is not all that complicated. It still comes down to finding a problem that people are willing to pay to get solved and providing a solution that is better than what is currently available to them. Heck if you do that well enough, you may not even need the systems. In today’s digital world word spreads fast if you’re providing a solution to an important problem that works.
If you haven’t heard of my podcast yet, it’s a collection of real and raw stories from an eclectic mix of Thought Leaders, Entrepreneurs, WSJ and NYT Best Selling Authors, and a wide range of women and men who have overcome great adversity by finding the gift in their challenges.