I founded 2 companies last October after Denver Startup Week. One failed and one is successful – learn from my many mistakes and hear my keys to success. There are 3 parts
Part 1. How to pick the right company to start.
People struggle with coming up with an idea for a company and 90% of startups fail. See how picking a business with the correct business model and profit margins that align with your passions can increase your chance for success.
Part 2. How to get customers – lessons learned in targeting and marketing
People assume that if they have a great product then customers will buy it. They need to realize that customers need to know about their product before they can buy it. Getting customers is hard and I made a lot of mistakes around choosing the wrong target customer and wasting advertising money.
Part 3. Opportunity cost, financial stress and the truth about becoming an entrepreneur
Becoming an entrepreneur is one of the most exciting experiences there is, but it is also really hard. We hear about all of the success stories that help us to take the leap of faith and quit our corporate jobs, but after a few months the reality of paying bills and dipping into savings sets in.
Here is my draft article. I am currently only 9 months into the year but I wanted to start listing out my lessons learned –
Lesson 3 Marketing is hard – This is way harder than I thought it was going to be. Until you are up at midnight trying to think of ways to get new customers you will not really get it. Some of my highlights are getting asked to leave a bridal show, ….ran an ad that didn’t have our name on it. A marketing person will be able to validate this
FB – great for getting clicks to website and for targeting specific customer types – their demographic info is awesome. I originally thought FB was doing great because the cost / click was lower than some other sites but I ended up with very few appointments from FB. It was a lot of people clicking because they were curious but very few people who were looking to book an appointment.
Yelp – I liked yelp for the most part. If you run coupons they take 30%, which is better than groupon or others, but it is a consideration. I am not sure if its true but I felt like when I ran ads I was ranked higher, so I ran a cheap promotion like $17 for $20 of value so that I would still be ranked higher but was only paying yelp a little over $5 per coupon. They were also a pain to redeem.
Google – the ads were tricky to figure out at first but I would move past adwords express and play around with different ads.
Groupon, Living Social and others – I never used them because the margins are horrible. I had read articles before but had no idea until I actually investigated. If you are promoting a $40 blowout then they want you to offer 50% off and then they take 50% of the remaining, so you are left with $10 or 25% of the original price. This may work for businesses with low variable costs like yoga lessons, but for most businesses this is a hard way to make money. You also have to factor in that most people that use groupon are the ones that are always looking for a deal, so there is very little probability that they will become a repeat customer.
Target customer – At some point my businesses have a lot of target customers…..then you get a client and you try to target people just like your client. Moms want time away from kids and to relax at salon. Targeted other hairstylists
SEO – it takes so much time. I will insert some screenshots later but I feel like it takes 3 -6 months to work. I have the patience of a 5 year old and want to know if something is going to work or if I should change it.
Lesson 4: Networking takes a lot of time but really does work
Almost all of my success and luck in my career and life has happened because of networking. I got my first corporate job due to meeting a recruiter at a wedding. I started my first business because I wanted to mountain bike longer. I have had so many people send me referrals, or vouch for me and that is what it takes some of the time to be successful.
Be selective about what events you go to. When figuring out who to talk to go to a group of people instead of going to an individual. When you give your 15 second pitch, then multiple people will hear you instead of just 1. When you go to events that allow the group to give announcements then introduce yourself and tell people what you do. I did Ignite and 1M Cups and they were both awesome experiences but I didn’t generate any leads out of them. Other pitch events like galvanize are a lot of fun too.
The people are awesome. Try to help people by referring them to other people to talk to. Share your advice and wisom and ask others. Ask others for advice – score mentor, google questions, use quora, Thank you Rich Nortnik for answering and providing guidance on my many questions.