Advice for a young startup
I'm a first-time entrepreneur and I've come across a few problems and solved them. I'm dealing with a certain couple of problems now that I'm not sure how to solve. Before I ask my questions, let me give a brief history of my progress. I feel like if I come at this from the "big-picture" angle I'll probably get more intelligent answers.
At first I was trying to build a business on my own but I realized that was a mistake. My problem was that I needed a business partner. Now I have a business partner to help bear the load of undertaking the task of starting a business.
I also didn't have anything that I felt was a decent business idea. Now I have one: software for salons. It might seem odd that I think that's my best idea - it's clearly not a "silver bullet" type of idea, but just go with me on this one. I haven't started actually designing or building the software yet, just so you know.
I have one customer right now. (The customer came before the business idea.) This salon is unhappy with their current software and there don't seem to be any acceptable competitors out there. Since I'm 100% confident I can develop something that's not a bloated, outdated, intimidating, Microsoftey hunk of flaming garbage, I'm confident that this is a good business idea.
Now, my questions are:
- Should I try to find one or two more customers who can help me see the product from a couple different angles, so I end up with a piece of software any salon could use, so I don't end up with a product that just solves person's problem excellently but no one else's? Or should I focus on my sole customer and wait until the product is "done" to turn to other customers?
- How can I deal with the fact that the salon depends on the crappy software it uses now (Salon Iris)? They don't like Salon Iris but they do depend on it. It seems to me that the only way to deal with this is to create a product that does just barely what it needs to do, then "flip the switch," then work on improving my product from that point on. Otherwise I'll be working on something until 2015, and I won't even know if it solves the right problems. Any advice here is appreciated.
3 Answers
I think that it is a good idea to do a bit more market research before jumping in and develop a product for just one customer. You should have more salons tell you what they like about the software that they use, and what they don't. What is frustrating? What is awesome? What is it about the software that makes it indispensable. You should definitely have a fully working and tested product before you roll it out. There will always be bugs, but the big ones should be solved before it becomes their only product. This is a great market to develop a product in because most stylists love to talk. You'll end up with way more information than you need.
One of the things that I do is website design and development for small businesses. Something that I have learned is to set clear expectations ahead of time, to always give yourself more time than you think you'll need, and to write a very detailed contract. Starting simple is probably your best strategy.
Hope this helps!
Alicia
I think the more validation you can get for your idea, the better. It could turn out that other salons don't see any problems with their software. The more people who say that they will buy your software, the better. Also, do you have an idea of pricing and how many customers you will need to make it a viable project? It's a good idea to ask customers whether they are prepared to pay the price you ask for.
Regarding your second question, delivering a minimal product sounds like a good idea, as long as the salon is happy with it. I suppose you could explain to them that this approach will help you get feedback from them and deliver a product that's better suited to their needs. It's a good idea to be able to fall back to the old software in case of any problems during the transition period.
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To answer your question about pricing, we have some idea. The figure we've been throwing around is a subscription model at $10/month. Since the only think we're risking is wasted time, it wouldn't take many customers for the project to be worthwhile. In order for me to be able to quit my day job, we'd need 20 customers (20 customers times $10/mo divided by two partners = $1000/mo). – Jason Swett 14 years ago
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@Jason: you mean 20 customers @ $100/month, right? Another thing to consider is how you're going to acquire those customers. – Alex Aotea Studios 14 years ago
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Woops. I suppose I meant 200 customers at $10/month. – Jason Swett 14 years ago
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@Jason: 200 customers is *a lot* and they won't be easy to get. Are you sure your software will provide only $10 worth of value in a whole month? – Alex Aotea Studios 14 years ago
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You're right. That is a lot. But as of 2005, there were 400,000 salons in the US. If I can do math better than last time, I'm only hoping to capture 0.005% of the market with 200 customers, and I'm not naive enough to think that can be done in 2 months. I'm willing to work for years to get to that point. Having said that, the price is not set in stone and perhaps we'll go with a higher rate. – Jason Swett 14 years ago
Agree with Alicia. You need to get "validation" from your potential clients. In short, get out there and try to get at least 10 - 30 people in the salon business to validate your idea by agreeing to try out your software and actually sign on for it if it becomes a reality. Do this BEFORE you start writing any code.
This blog post is related to your question, I recommend you read it:
