mistakes you are about to make
DESCRIPTION
Problems all first-time entrepreneurs face. Talk given at Thiel Foundation's 20 Under 20 program, based on course corrections of the 2011 class.TRANSCRIPT
Why This Talk?
Worked with 10 of the first Fellows
These are the biggestareas of course correction
I observed.
DON’T THINK SO MUCH!
I Want My Idea to be Perfect!
“I better dedicate lots of time to planning and
getting it right.”
Right?
Plan Less, Do More
If you work everything out up front• You will waste time on un-important parts
• You will miss important parts
Learning Loops
Do Something
Learn From It
Reduce the time to learn by tightening loops
Build an MVP
Be small and focus on the real value
Focus on early adopters.• NOT full-featured• Potentially ugly
Remember: This is an experiment, where the goal is to validate the
business model
YOU ONLY THINK YOU KNOW WHERE YOU’RE GOING
I Have a Great Idea!
“I need to hunker down and build it.”
Right?
Your Idea is Only a Hypothesis
Your Idea is a first-stab at what you believe the market needs.
Treat it like an experiment, not a long-term plan.
Markets are Discovered
Typical thought process:
Reality:
“I have an idea. I need to build itand convince people to buy it.”
A market need exists.
You need todiscover what it is.
Before any human knew that 1+1=2, it was already true.
Someone didn’t
invent addition
and convince others.
They discovered an existing principle.
Your Only Goal:Discover What the Market Needs
Learning Executing
Product Market Fit
You are HereYou Want to be Here
IN THE DARK
My Idea is Wicked Cool!
“I better keep it a secret.”
Right?
Stealth is Generally Really Bad
Many first-time founders think“If I tell people, someone will steal my idea.”
“I need to highly refine my idea or even build a complete offering before showing the world.”
The value you gain by sharing your idea
is enormous.
The risk you take is minimal.
Getting someone to steal your idea is really hard. Try it.
Get Feedback
Share your vision - keeping it secret will fail!
Speak with confidence, but be
listening for what is broken
Getting others involved gets them engaged and makes them part of the process
Talk to People that MatterYour friends will all say you have a cool idea
Find the people that will have to pay money for your idea to succeed• Potential customers• Investors• People who have a vested interest in saying
‘no’. (or ‘yes’ if you have what they need).
You need potential customers
to say something like
“If only I had the XYZ widget, I wouldbuy 50 today. I need a solution to myproblem and XYZ has the best/only wayto solve it.”
Feedback Specifics
Get real feedback!“Would you use this?”
“Would you pay to use it?”
“What is most interesting to you?”
“What is not important to you?”
“Do you use a competitive product?”
“What do you pay?”
Bad is GoodThere are bad spots in your idea.
The faster you can uncover them, the better.
Trial Close Them
“If I can deliver this, would you buy it?”
Understand how the money flows
Which party actually has the need?
Do they have money?
How does the money flow today?
Be Prepared to Change
9 of 10 Ideas are Crap – be open to change!
It’s rare that a successful company ends up where it started
FOREVER ALONE
It’s My Project!”
“I better do it all by myself.”
Right?
Get a Co-founder
•Distribution of responsibilities•Peer pressure•Support•Idea validation
Conclusion
Plan Less – Do More!
Engage Customers - Discover Your Market!
Tell Everyone Who Will Listen About Your Idea!
Get A Partner!
