How to pilot from idea to the marketplace.
Piloting isn’t just for beginners or first timers. Its for anyone that is looking to create a new avenue in their entrepreneurial income stream by creating a minimum viable product that you can test the concept with.
Piloting is so lost in the entrepreneurship journey. No one wants to talk about it anymore. We all talk about how most businesses don’t expect to make any money in their first year, but we don’t talk about why.
We hang on to stories about unicorns like Kickstarter and Amazon and act like they were in the same position as the average entrepreneur with no marketing, no branding, and no budget, completely bootstrapping to the place they’re in today.
No. The reason these giant businesses weren’t making money in the first year is because they understand the art of the pilot. They know that in the first year of business you're spending all your time building the foundation of the future of your business. Your first year determines what your business is going to become for the rest of time. So they’re not focused on making money. They’re focused on getting their foundation right.
That’s why you find companies that get funded out the gate once they launch. A skilled investor is going to notice a strong foundation. They’re going to know where your business is going and that you’ve set up the core tools you need to get you there. Investing at that point is just good maths; better invest now before everyone else catches on to the fruit of your labour.
Talk to any successful founder. They know what it is to test things out, see what works, give the business time to manoeuvre and react to the culture of the ideal customer and THEN release it to the general public. AND THEN RELEASE IT TO THE GENERAL PUBLIC. Not. before. After.
What most entrepreneurs are doing, is why most entrepreneurs are failing.
Most entrepreneurs put no money in the business, put no work into bootstrapping a marketing or branding hack, put no work into the foundation of the business, but they’ll buy Google adwords, Facebook ads, Instagram ads and when those inevitably don’t work, they’ll say, “well I didn’t expect to make any money in the first year anyway” OR even worse, they get the demand they wanted but they don’t have the foundation set up so they have no idea how to deal with it when it comes – trust me. I’ve been there. It sucks!
Don’t fall for the hype. Don’t skip a stair on a staircase. Don’t skip a level on a ladder.
Piloting your business is about spending a good amount of time on perfecting the magic formula that’s going to take you to the top.
You should be spending up to 1 year on developing and implementing business strategies that solidify the foundation of your business, get early adopters on your side and set you up for massive wins when you’ve got the budget to use ads to reach beyond your social circle.
I suggest 1 year for businesses that are starting fresh. From idea stage to marketplace launch should be no more than 1 year.
I define idea stage as this – “Yo, I have this dope idea!” and it includes people that have created a website, created social media pages, done a couple of things here and there, printed business cards, added it on their LinkedIn profile etc. As long as you’re not making money, you're in the idea stage. Point blank period.
Prototype is when you’re selling to your inner circle and extended network, using them as a springboard into their inner circle and extended network. During this stage your customers are primarily coming from referrals and social media marketing (not paid ads). This is where you’re going to be at the end of the pilot period.
Give yourself 6 weeks to pilot your idea out and then the rest of the year period to make your prototype work. By the end of the year you should be making enough to cover your costs, you should know where your ideal customer are and should have significant notoriety within pockets of the community your product or service has been built for.
In this blog post I’m going to cover the principles you should put in action in the first year of your business. You can download the framework to help you plan this one out.
PILOTING FROM SCRATCH
I love it when I speak to a client for the first time and they say something to the effect of, “I haven’t really done anything yet.”
This is a great place to be, especially when you’re looking to hire a coach. It means that instead of building on the mistakes you made in the past, you’re starting out fresh and you can do things well from the beginning.
The premise is, you’ve done nothing, you have nothing. So, you need to start by setting up the foundation, and that’s made up on these 5 keys.
KEY 1 – Your vision
When I was 12 I started a cleaning business. When I was 15 I started an events business which led into promotional printing. When I was 16, I decided I wanted to design websites, so I did that for a while. I tutored, I helped people write books, I did a whole bunch of stuff, for doing sake. I was never interested in the future of these businesses because they were never part of my end goal. Business was a hobby.
When I was in my first year of undergrad, I got bored with school. I wanted to do something that was really challenging. So I decided to start a business. This was the first time my hobby became a disaster. Before, every business I had run was based on my time, me having fun, and not really caring.
But in my first year of undergrad, the business I was running caught the attention of the MBA advisors, I caught the attention of the university newspaper and other people’s university newspapers.
Suddenly, I had a 75-person team across 12 universities and I had NO IDEA where I was going. When it all came crashing down (because of a massive lack of vision), I had 75 people looking at me like a ran a Ponzi scheme with their hopes and dreams.
The vision you create for your business is a guide for your future. It’s the world you want to create with your business. Its your road map.
Your vision is crucial to the development of your business and its future health, scalability and sustainability. Its what will keep you going – if you care about the problem you’re trying to solve.
KEY 2 – Your Sob Story
This key is necessary for the vision to actually mean something.
“Nothing that’s a cash mint, started as a cash grab” is one of my favourite Do it Now Now sayings because it’s FACTS ONLY.
You can’t expect to create a business that is going to stand the test of time if you can’t find something within yourself to keep you rooted in it when things get difficult.
That business I was running in undergrad is still a good idea, but I was not the right person to do it. I didn’t have any real personal connection to the problem or the solution. I saw a gap and I thought, “hey wouldn’t it be fun to tackle that problem.” So, when things got hard, I just went back to my life, a decision that seriously disappointed 75 people.
This thing is hard. It is inexplicably hard. Running a business is tough. That’s just how it is. The reason every company gives away pens and stress balls at business fairs is because they understand that those are the two things you’re always going to need.
What’s going to keep you interested when things get that hard? I’ve written a blog post to help you out with this one.
KEY 3 – Your mission
This is the WHAT. I tell my clients it’s the best conversation starter in every networking situation. Your mission is the one-liner you tell your friends, family and a random stranger when they ask you what you do.
It’s the broad strokes statement that covers every operation in your business and get the the core of your vision in practical terms.
Most businesses have a mission statement to keep the investors, employees and other stakeholders in check, because if it doesn’t fit in with the mission, you shouldn’t be doing it. It’s a great way to keep the business on track.
A mission statement can be difficult to write, but if you’ve done the work to create your vision and you understand your personal connection to the vision via your sob story, your mission will be much easier to come to terms with.
Like everything else on this list, there’s a blog post for you to check out that gives you more detail on how to write a winning mission statement.
KEY 4 – Your Ideal customer
Once keys 1, 2 and 3 are done. You’re going to have a really strong idea about your brand, your competitors, your potential strategic partners etc. there’s no way you haven’t already come up with a few ideas about the company you want to run, the culture you want to build and the people you want to attract.
That’s what makes this the perfect time to start thinking about who you want your ideal customer to be.
This can be a difficult transition. Its about breaking the instinct habit.
In movies, entrepreneurs are made to look like these really erratic genius level individuals who do everything on intuition and a supernatural awareness of the world.
Let’s assume you’re not a superhero. Same standard I have for myself. Just a regular human over here.
Non-superheroes are fallible, forever changing, extremely complex characters. For example, I enjoy the Kanye as much as I enjoy One Direction. Different moods, different tunes.
So, if I was creating a brand based on how I felt from day to day, my brand would swing between Kanye and One Direction and I would lose customers because no one likes whiplash.
Despite the fact that as humans we’re fully inconsistent, we crave consistency. That’s why you need to create an ideal customer profile.
An ideal customer profile is a static image of a fictional character that you have created to reflect the ideal characteristics of your ideal customer.
So, instead of making business decisions based on instinct AKA how you feel in the moment, make your decisions based on whether or not your ideal customer would vibe with your decision.
We’ve created a 30 questions in 30 days guide to help you discover who your ideal customer is. Each question gives you insight into the character you’re creating and it’ll help you key into your base when you get to creating your marketing, press, branding etc.
KEY 5 – Your 1-year pilot plan
Once you’ve set up keys 1 to 4, that’s when you’re ready to start actively piloting your product or service.
The best way to do this is to come up with a 1 year pilot plan for your business.
We’ve developed a framework to help keep you on track in your pilot year.
There are 2 key rules to make a pilot work. The first rule is set up the foundation – which you’ve done in keys 1 to 4. The second rule is don’t spend any money, or spend as little money as humanly possible.
Currently, there’s a lot going on in the world of Hip-pop. Specifically, Joe Budden just left Everyday Struggle. NO JOE NO SHOW. Classic mismanagement of talent on Complex’s part and a whole lot of miscommunication apparently.
After listening to Budden’s podcast, its clear that he didn’t understand that COMPLEX was piloting the show.
He thought a massive corporation like COMPLEX would be down to spend all the money on marketing and advertising the show. He thought they wouldn’t change the formula, he thought they would just be happy that the show was successful and leave it at that.
But that isn’t the point of a pilot. You pilot something to test its limits. You try different ways to produce maximum impact for the cheapest price tag possible. So even if your pilot is exceeding your expectations, you keep testing the boundaries to see if you could do better.
My favourite “almost” story is Gary Vaynerchuk’s story of how he went from 3 million to 60 million in the early 2000s using a bunch of tactics like email marketing, direct mail and Google ads.
The interesting part of the story is that he kicks himself because he knows that if he’d tweaked his strategy to focus more on Google ads, he would’ve made 200M not 60M. Massive difference, but still successful in either case.
The problem was that he had no idea what the numbers were doing. He was just throwing everything that he knew worked at the wall and didn’t notice that one tactic was 85% more effective than the others.
That’s why you pilot. You pilot to tweak. You keep changing things, you keep watching the numbers based on your metric of success, and you keep looking at your vision, mission, sob story and your ideal customer profile to make sure that you never go off track.
That’s how you avoid making the same mistake Complex did – they lost a key part of their success formula in Joe Budden. If Budden and Complex had the same vision and mission, 2018 would be a stellar year for the company and the culture. But right now, Complex is losing YouTube subscribers and Everyday Struggle is probably going to fail as a show.
For a pilot to be effective, you have to treat it as a test of concept, logistics, branding and customer service. You test everything out and you keep changing it until you’ve figured out the optimum performance for each part of the business. When you’ve done that, and created the optimum sales platform (the minimum viable product aka MVP) for your service or product, you can start sinking money into your business to get it to the next level. The Marketplace level.
That’s all folks.
Thanks for reading,
PS. We cover a lot of this in the FREE 6 week Grow Everyday Accelerator program. You can sign up here.