How to Double Revenue in 6 Months with Martin Wilson
“I love working with passionate people on tough business problems, making an impact, and seeing the merging of strategy and execution.”
Starting a business isn't a walk in the park. In fact, it's more like an intricate, multi-leveled puzzle that knows exactly where you as an entrepreneur need to be tested. To further complicate things, the skills and knowledge that help you complete one level of the puzzle won't necessarily help you solve the next.
As entrepreneurs I think we can all relate to being in a position where we don't know how to get from where we are to where we want to go. Maybe we haven't even gotten started yet. Or maybe we've had some success, but we've reached a point where the wind seems to have left our sails and the business is at a standstill. That's why for this episode of the podcast, we brought on growth consultant Martin Wilson.
Martin has a 20-year career spanning technology-to-consumer products. He's worked across the full spectrum of business: from small and medium sized organizations to Fortune 100 companies. After leading two start-ups and becoming an angel investor, Martin now focuses on his passion: helping small businesses radically grow their revenue.
Martin recently wrapped up a consulting project where he helped double his client's revenue within 6-months. He shares the strategies, mindsets, and frameworks he uses to consistently transform stagnation into growth.
|02:06||How Martin went from enlisting in the Army after high school to strategizing with the board of directors for Fortune 100 companies|
|3:28||Why Martin loves working with small companies|
|5:36||The two areas to focus on if you want to achieve growth|
|7:00||What is the Valley of Death for businesses?|
|9:10||The litmus test Martin uses to evaluate potential clients|
|10:50||A key difference between making a market and fulfilling a need in a market|
|12:44||Martin shares a personal story demonstrating how our strengths can become our weaknesses|
|14:37||Why entrepreneurship is really a journey of self-realization|
|15:33||Doubling revenue in 6-months|
|19:56||The danger of “groupthink” – especially for small companies|
|21:20||How to uncover deadly assumptions and hidden problems with a technique called the 5 Why’s|
|22:56||Why entrepreneurs need to adopt a risk-adverse mindset|
|24:30||Is your business a rowboat or sailboat?|
|25:58||A piece of advice for ALL entrepreneurs|
|28:40||Steering towards success with Big Hairy Goals & 90-Day Action Plans|
|38:18||The antidote to curb the inner voice persuading you to drink scotch and play video games|
|41:38||A resource to help newer entrepreneurs sidestep a tough lesson|
“One of the things I find that is really interesting is that entrepreneurs tend to take risks because you’re entrepreneurial. Doing an entrepreneurial venture by itself is very risky, but as entrepreneurs we actually need to take a really risk averse mindset. You have such limited resources, time and energy. It doesn’t really matter if it’s just you at the start, about you at the start, or a few other people, but if you head down the wrong path you are toast.”
Hello and welcome to the episode 104 of the Passion for Purpose podcast. Where we talk with entrepreneurs about their strategies for success and the lessons they’ve learned that transformed their lives. I’m Eric Turnnessen and today we are talking with Martin Wilson. As entrepreneurs I think we can all relate to being in a position where we don’t know how to get from where we are, to where we want to go. I’ve certainly been in this position many times throughout my journey growing MemberMouse and I haven’t always had access to someone with experience, who could help navigate through these situations. Martin’s background is varied to say the least. He went from enlisting in the military after High School to working with the board of directors of the Fortune 100 companies, venturing into startups, angel investing and now he runs his own consulting business where he focuses on his passion, which is helping companies get past these exact sticking points I’m talking about. That point where there’s an obstacle that’s keeping growth from happening. Maybe the reasons why are known and maybe they’re not. In any case, Martin shares how execution, removal options and really driving into it and understanding the situation is the key to moving forward. How do we do this? How can we apply this to our own business or project? In this episode I put these questions to Martin and we specifically get into how he helped his most recent client double their revenue in just six months.
Eric: Welcome to the show Martin and thank you for joining us.
Martin: Pleasure to be here.
Eric: To get started can you share with our listeners a little bit about your background?
Martin: I’ve been fortunate to be a part of a lot of different roles. I started out after High School in the military, which I don’t recommend for most people. Especially, if you are thinking about small companies what most of us love about small companies. The Army is the antithesis of that. After that I got a computer science degree. I really started on the technology side and built some of the earliest software and service offerings. Really cutting-edge stuff and great people. For me personally, after doing that for a number of years, I noticed a big gap in my skill-set. I then went to get an MBA and work in the strategy/turnaround space. One example is evaluating Fortune 100 companies for their board of directors and being hired by big Investment Banking firms and turning around their companies. When I look back on all those experiences and what I really loved most was working with that passionate people on top of business problems. And, having the ability to make an impact and see the merging of strategy and execution. My earlier career was all in small companies and after that I got my MBA and worked for a while in big companies. Then I went back and started my own companies. I started advising small companies and for me – coming full circle, small companies really represent the nexus. Really passionate people, and those top business problems, having an impact and really being able to use strategy and execution. It also means what I really love about small companies is you get to play a lot of different roles. Sometimes I will do strictly coaching and advising with the CEO where we meet once a week and we go through different problems. Or, I do a specific problem or project. Like, we want to release a new product or we want to tap this new attack this new business channel. Let’s do an evaluation of that. Maybe I’ll even come in as an interim role, which I just got done doing, as the VP of sales to really drive revenue for a company.
Eric: That’s a really varied experience. You’re working for the large companies, the Fortune 100 companies, the C-level guys on the board and then you started your own businesses and you’ve worked with small businesses. It wasn’t just a direct linear track for you.
Martin: No, from the Army to technology to the NBA, there is a lot of weird, winding routes. A lot of roles that I really quite needed. That kind of journey that we all of us go through in order to figure out what you love. It takes failure to figure that out.
Eric: The thing is, you must have learned – where you are now and how you operated as a soup. Each one of those things has a certain ingredient in that soup. It’s interesting to me with everything you’ve gone through, how you’ve come through to where you are now, and how that synthesizes together to drive what your approach is. And, how you focus on what you’re doing.
Martin: Yes. And to your question on how I chose this route, specifically the growth pass, there’s a lot of people out there who work in small companies, or in big companies, or medium companies, but for me growth – and what really attracted to me to focus on small companies in the growth phase, is I’ve always been super passionate about customers and the sales side. If you kind of think about the whole customer experience, it’s about understanding the problem, figuring out the right solution, and being able to sell and service them. To me, in a weird way it actually gives me goosebumps to think about what product do they need and how do you sell it to them and how do you serve it to them? All that leads to cash, which all of us need that to grow, to survive and to thrive.
Eric: Reflecting on my experience with MemberMouse, and let me know if you resonate with this, to restrict it to growth is a little bit limiting because I feel like growth is a byproduct. There are phases of business. You can go from 0 to 100 pretty easily, but to get from 100 to 101 is hard. Once you get to 101 then you can get to 1,000 and then to get from 1,000 to 1,001 is hard. It seems like what you’re passionate about is when you get to those natural plateaus and you need to decide how you get from where you are to the next growth phase. It’s usually not obvious, what the thing is that’s keeping you from getting to that next area.
Martin: I think that’s a really important point. There’s kind of two things – if I can extract what you’re saying here, there are phases as a business and in between those phases there’s this idea of a Valley of Death. Someone else came up with that idea. I remember reading that years ago. If anyone who’s listening to this podcast who is interested, there’s a really good book called Running Lean. It’s a great, great book. It talks about – especially for startups, what are those phases. For instance, the first phase is you’re trying to figure out the problem-solution space. Once you get a product and you have a market fit, then the third phase is actually scaling those up. In between those, there’s a lot of things you can do wrong and out-of-sequence. That means you hit this Valley of Death and you just flounder and die. It’s hard to know because it’s not codified what you should do in each phase. There’s certain things that you need to do, but there’s a lot of things you can do incorrectly that keep you in that Valley of Death.
Eric: I know for me, looking back, it’s hard to even know that you’re in the Valley of Death. I know in retrospect I can see how I spend x amount of time floundering around trying – doing that thing where you know the definition of insanity is to try the same thing multiple times and expect the same results. You don’t have the experience or the context or the perspective to see that you’re doing that. I imagine the point at which someone comes to you, do they usually recognize that they’re in that situation?
Martin: That’s a really good question. When you say the situation, do you mean the Valley of Death or that they have a problem?
Eric: So, they’re banging their heads against the wall, “why can’t we get from x thousand, million dollars in revenue to y? We’ve tried these different things and nothing seems to be working, or budging the needle too much. What we’re missing?”
Martin: I think what’s more important is, where they are mentally. I think one of the litmus tests – when I’m talking to companies, I’m trying to understand is do they really feel like they have a problem and are they willing to get out of their comfort zones to solve this problem? If they’re not, then I don’t usually work with them because none of those people are going to be happy with the results. If you’re not willing to go outside of your comfort zone or you don’t actually think you have a problem, then we’re going to be fundamentally disagreeing. If you bring me in, that’s the whole idea. You have a problem. One of my big tests is – sometimes I get brought in for like the VP of Sales and the VP of Product will say, “yeah I need help in this area.” But, if I’m talking to the CEO and the CEO is not on board with, “yes we have the problem and we need to get this stuff fixed,” then I know I’m walking into a situation where there’s going to typically be a big uphill battle.
Eric: Right. That’s a personal choice that you make. You’re not the guy that’s going to force someone to learn that they have a problem. You want them to be ready. They recognize that they want to change. Fighting the battle of somebody getting ready to change, only someone can do that themselves. It’s a thankless job if you are the one that has to do that.
Martin: The takeaway for entrepreneurs – I think you and I have learned this really well, are you trying to convince your customer to buy your product because they have a need? Or, are you trying to convince your customer to buy your product and then convince them that they really have this need? Are you making the market or are you fulfilling and need in the market? I certainly and my career has tried to make markets and if you can do it you can make a ton of money. You can be a leader in the space I mean think of YouTube, YouTube made and market.
Eric: I think of those little fidget thingies that people play with.. Where did that come from?
Martin: Right! Where did that come from? If you can make a market and you do it right, you can make a ton of money and go really big. Even the bike sharing services argue that they’re trying to make a market because right now they’re not able to profitably do this business model. I don’t want to convince someone that they need my service and also convince them that they have a problem. I want to convince them that yes you have a problem, maybe I’m the right fit and maybe I’m not.
Eric: What was the word that you used? Comfort. Are you willing to change, are you willing to go into discomfort because it seems to be that that’s a good litmus test. Another perspective to look at is whatever discomfort you’re feeling may be the exact thing that is keeping you from going forward. It may be that that discomfort is the reason why you don’t see where the opportunities are therefore, naturally if you want to pursue those opportunities then you have to push beyond that discomfort and keep it from holding you back.
Martin: A good personal story that I have and this is partly due to my own hubris and sense of Independence. When I was younger, I was in the middle of developing and app, not much younger- about 10 years ago, when else were relatively new to this scene. I was going to either develop a website and app. I done some customer interviews. I really felt like I knew how to develop a website, much better than a app. I was a little biased in my Impressions. I went out to a few advisors and I said here’s my problem. I want to build a website instead of an app and here’s why. Every one of my advisers, except one, was saying “you need to build an app. This is the future. This is the space in which you should operate and here’s why.” I didn’t listen to them. I didn’t listen to them because I was uncomfortable with my own ego and getting out of that space. I was also uncomfortable because I knew I had to go there and learn how to build an app or hire someone to build an app – where I knew how to build a website really quickly. For me, I failed to get out of my comfort zone and in result I missed a really pretty big opportunity.
Eric: I have a similar story with MemberMouse. When I was actually starting and working on MemberMouse, I was absolutely adamant that I did not want to start a software business. I was doing everything possible that I didn’t want to be in software. I was looking at you e-products. Then the opportunities kept coming and they were saying “hey can we use the software that you’ve built for your own site?” I said, “no.” I felt uncomfortable because I didn’t want to go there. I was basically ignoring the signs that were telling me this is the direction to go in.
Martin: It’s funny how all this stuff become so much meta because of the introspective nature of who we are and how we operate as people. We have these underlying assumptions or bias that we bring to the table. I think for every entrepreneur, the journey of self-realization happens. It’s so much harder to be an entrepreneur and it’s so much more mentally challenging emotionally and then to go to work for a major company where you’re kind of flooded in. You’re not necessarily pushed outside your comfort zone very often.
Eric: Yeah, I completely agree. I find that a lot of the journey of building a business ended up being more of a personal development journey than anything else. Obviously, successes and things were reflected in the business. One of the things specifically, I’m interested in learning from you is – my understanding is that you just wrapped up a project with a client where the result was that the revenues doubled. I was wondering if you could tell us about this project and what your approach was? How did you recognize the opportunities and ultimately work with them to make that change come about?
Martin: The genesis of the project was the CEO reaching out to me and saying “hey I just want to have a conversation about this.” They had a great brand in the marketplace. This was a niche product. The total addressable market in the US was 100 to 200 million. So it’s still a relatively good-sized market and they were one of the major players in this market, but it was a very packed market. It’s a newer industry. The challenge they had was the CEO was an amazing entrepreneur, but he was really good at getting a product, figuring out what the problem was, figuring out how to get the product to Market, getting a good product-market fit. They were at the stage where they were trying to figure out – how do we scale up the company. Coming in it was very clear to me as we started talking. I will start – when I meet with someone, really talking about – do they have a consistent vision of what the company is? If this CEO or the senior-level executives don’t have an aligned vision about where the company is going and what some of the problems are, that to me is step one if you have a big disconnect. Oftentimes that happens. In my process of sitting down with the company, I went around and talked to all the high-level people, including some of the customer service people. It was very clear to me that there was a central theme around where the company was going and what the big problems were. That was great. Then it became more of, how do we do this? In this case the CEO was feeling that he was really good at the product and operations, but he didn’t have a good focus on the sales. He was just spread too thin. In that list, engagement played out and by the end of the week we had a pretty good sense of where we needed to go. We didn’t know exactly how to execute on those, but had spent a good amount of time making sure that we are solving the right problem. Then, you can start diving into what are some ways to solve those problems. In a nutshell, that was a six-month process of working with the CEO every day, working with the sales and marketing team every day to really tighten up their relationship with distributors, dealers and their customers – a full life cycle tweaking. The way I always break things down is – what’s our big hairy goal that we are trying to achieve in this? How do we measure success and let’s really start getting practical, how do you execute in the next 90 days. Then you break that down 30, weekly and then even daily. I was do daily meetings with my team. Those quick 5 to 10 minutes stand-ups at the start of the day, making sure that everyone is focused.
Eric: In my experience, it’s not always that difficult to identify what the problem is, but well sometimes it is but let’s ignore that for it this.
Eric: Assuming that you know what the problem is, and you may know what the problem is for a long time and then you talk about we identify the problem, but in this scenario it seemed like you didn’t have to convince people. Most people, based on who you talked to, knew about what the issue was, where they wanted to go. There wasn’t too much work that you had to do there. You know what the problem is. Given that they knew that, but they weren’t able to move against it. Then you come in. What were the things that you did differently? I’m thinking of the arch stones. There’s these things that when you geo-chop them in the right way things fall into place. What were those and what are those things? You know what you need to do but for some reason it just isn’t happening.
Martin: Let me make one comment to the problem statement that I find is very common. It gets to be a lot of group-think, especially in small companies where there’s not a lot of political stuff going on. Bigger companies are very different. In smaller companies – maybe even ignore a problem, but you realize that this is a problem. Let’s take a big issue, like you’re not getting enough revenue because customers are turning over a lot. That is the problem but as you start to drive down one of the techniques is always to ask “5 Whys”. The problem is that customers are turning a lot, but you really need to dive down into what’s really the problem. Why are customers turning a lot? You ask that question. Well, we’ve got these three things in this example. We don’t have good follow-up to customers once they purchase, we’re not delivering things on time, sometimes customers are returning thing and we don’t have good customer support. As you start to drill down there. As you get really specific and understanding what the problems are that are driving some of these bigger issues like revenues or cost. Then – to get to your question here of how do you do those, one of the techniques that works really well for me is being really open about – what do we think the problems are and what are the underlying assumptions for those problems? Doing those things like the “5 whys.” You start to develop your list of solutions. Then from that list of solutions – usually there’s some big surprises. I was saying that 50% of the solutions they knew, but we uncovered a whole other bunch of other solutions. Then it’s usually a pretty simple exercise and I usually just get the team together in a room and say “hey guys we’re going to have lunch and spend two hours on this. We are really going to brainstorm through these solutions. We are going to start to understand what are the costs around fixing these solutions – sorry I mean implementing solutions. What are the benefits and what are some of the underlying assumptions that we’ve made?” A great example that happens is people will say “our emails need to look better.” I find that oftentimes people have all these underlying assumptions. Like, if we send out better emails, we will get better click-rates. What’s that based off? Tell me where the data is that has shown this. Tell me the customer that has said this. Where did we get this? One of the things about bringing someone in from the outside that is really great is – I can ask really simple questions and start to uncover where the problems exist, the solutions and all the underlying bias and assumptions. All of this stuff takes time. One of the things I find really interesting is that entrepreneurs tend to take risks because your entrepreneurial. Doing an entrepreneurial adventure by itself is very risky, but as entrepreneurs we actually need to take a really risk averse mindset. Because you have such limited resources, time and energy. Sometimes it’s just you at the start or a few other people. Where if you head down the wrong path, you’re toast. Whereas big companies you can plow 20 million dollars into a failed project and if it has a 3% chance of making it, but it’s worth a billion dollars, you’ll do that all day. As a startup you really can’t do that. Everyone wants to do things that are effective, but often times we get blocked, or we make those bad decisions. Fundamentally, we don’t understand the problem. We haven’t dove deep enough or were patient enough to get results. We don’t figure out ways to simply test assumptions. You can test assumptions around click-through rates, better emails. You can run a simple split-test to see if your times if you have better click-rates. That’s an easy thing to figure out. Some of these other things they just take longer to figure out. Especially, if you’re a B2B company and you have a six months sale site, you don’t want to implement a big change to you sales cycle. That could really impact your revenue without really understanding it and testing it out.
Eric: Reflecting on my journey with MemberMouse, when you’re starting totally from scratch. I look at it as a metaphor of ship size. When starting off, you’re basically in a rowboat and you can turn on a dime and do whatever you want. No one’s going to say anything about it. You’re obviously not successful. Once you get successful there’s a different operating mentality that has to happen. The ships bigger. If you want to turn it, it takes more resources. To effectively turn the ship takes more energy. Therefore, if you’re going to invest your energy into a direction, you have to learn to – like you said, test your assumptions. That was a big thing for me. There was this bleed over space where the ship became big, but I was still operating like it was the Wild West. Like, we can still make decisions based on where we were when we were still just a rowboat. You quickly realize that not all of our assumptions are correct. And it’s far more cost-effective to have a little patience, take the time, test the assumption to ask the questions. Then move forward based on the consensus. It was definitely something to learn through the experience of doing it the wrong way.
Martin: I just got off handed piece of advice that I would give to every entrepreneur is – find a few mentors. Talk to them every once in a while, on a monthly basis. This is actually super easy to find because you usually just have to ask a few people. If you’re an entrepreneurial city like Seattle, or Portland or even through LinkedIn. I know so many older entrepreneurs and they love talking to younger entrepreneurs. A half an hour call and they can do it in the car. It’s like giving back to the community. Especially, if you’re a first- or second-time entrepreneur you are going to fundamentally, naturally make a lot of mistakes because you’re in that uncomfortable zone all the time – trying to do stuff that you’ve never done before. Get an advisor because you can quickly ping them and say “hey I’m doing this and here’s the problem, what are your thoughts?” They can say, “no I’ve done that before and it doesn’t work.” Maybe it’s right or maybe it’s wrong. You don’t want to waste that time and people really do love to help out entrepreneurs.
Eric: One of the biggest values of that is not only in the years of experience, but also that external perspective. A lot of times, we can live so long with something that we believe that we end up having a multi-leveled rationalization process of why we think it’s correct.
Martin: Yes, denial is fantastic. The human race has fundamentally survived through this idea of denial. “That’s going to happen to somebody else, not me.” We are so good at denial. So, that external experience is extremely valuable. Going back to earlier point, it means absolutely nothing to go and get a mentor and get on the phone with someone if you don’t recognize your problem. Number two – when I was listening to you talk about working with the team and then executing on the solution. Yes, you have to know what the problem is and agree on it, but you also have had to make it a priority to address it. If it’s not a priority then you say, yes, it is a problem, these are the solutions, but “oh but these other things are cool, let’s put it on the shelf.”
Martin: We could talk for hours about how I saw that.
Eric: Is there a 30-second version?
Martin: There is this great New York Times article that I read years ago when I was talking with a CEO about only doing 90-day goals. I still have it in a scrapbook somewhere. What I realized, especially as an entrepreneur is I would say – take these things and do them religiously and this will really help amplify your success. Which is, as a company you figure out what are your ‘big hairy goal’ is. If you want to have a hundred thousand people that use MemberMouse. Let’s say that that’s a goal. That’s your ‘big hairy goal.’ Every 90 days I would get with my team, and usually it’s just the executive team to start with, but we would spend the whole day thinking about our problems and analysis. At least once a quarter thinking about the next 90 days. You want to figure out what should be our goals this quarter. You can’t make too many. I would say no more than five things you should be focused on in a quarter. These can be themes, but I would like to them to be more goal specific like, smart goals – smart, measurable, actionable, and realistic. Everyone can do 90 days. For the human being 90 days, it’s in front of you. So, 90 days I would break down with the team – this is what we’re to be focusing on for the next 90 days. Then you break it down in 30 days and every week on Monday I sit down or each department would sit down with their team and you are literally like “here is the focus for the week.” You write it up on the whiteboard, so the operations group have this, the customer service group has this. You can see how all those tie together and it creates this continuity. It’s not this one team is doing this and this one team doing is doing this. It goes back to the 90 days which links back to the ‘big hairy goal.’
Eric: The question it raises in my mind is, it reminds me of going to the airport this past weekend. I had to get my friend to the airport. The airport was an hour away, but we also wanted to stop at two places along the way. Some stuff had to happen there, so I thought we want to get to the airport on time and that’s the ‘big hairy goal.’
Martin: That sounds sketchy. You say some things had to happen along the way, but I can’t tell you what.
Eric: No, I’m going to tell you. I’m going to tell you, but now I might have to make it up to make it more interesting. We had to go to the co-op first to get some food.
Martin: That’s very Portland, right? Going to the co-op.
Eric: Exactly. Then we had to go to Kohl’s to get a suitcase. I thought, it’s going to take this amount of time to get to the co-op. It’s going to take this amount of time to get from there to Kohl’s. It’s going to take this amount of time to get to the airport. I know exactly just timewise, how long it’s going to take. Then, I think we’re going to spend this money time in the stores. I type that in. I think we need three hours to get there. To me, the ease of that exercise – knowing where your destination is. You know the distance, which is a static number and you know how much time it’s going to take. It’s really easy to plan how to get from point A to B. Even if you got some points you have to hit along the way. For me, what becomes a little bit muddled in dealing with ‘big hairy goals’ of the business is – those metrics aren’t so obvious sometimes. If I want to get from 10,000 to 100,000 customers, well obviously I know it’s a difference of 90,000, but what’s my mechanism? What’s the car in this situation? What is the gas? To me, that can be a stumbling block. Even figuring those things out. Without that you can’t even have a chance of planning and measuring.
Martin: What I would say to that is yes, in order for your business to get there you have to figure out what the course is. That course is not a straight linear path. It’s not – I’m going to do this correctly for 180 days and then I pivot to this. The fact that you’re saying “I don’t actually know,” is exactly why I felt as an entrepreneur and I have countless examples of this – 90 days are really good time frame to work off of. You’re saying basically to get this because this is our chart and we don’t know, we are going to fail a lot. It’s okay to fail. We don’t want to fail intentionally, but we do want to fail by design. Planning out 90 days and sometimes breaking down by 30 days and even weekly, you can say hey “we’re going to run this test this week. We believe that if we make this – we do this Biz Dev partnership. I’m just going to say with WordPress because that’s easy. Your guess is that will drive 10,000 more customers. You’re going to make that part of your 30-day goal. At the end of it, it allows you to test that out, look at it and see if it will actually work or not. So much of what we’re doing, they are the best guesses of what will actually work. That’s why I really like that 90-day goal because you hear this analogy all of the time: you’re taking a sailboat and you’re zig-zagging back and forth. The reason for 90 days and really being able to test your problems on a continuous basis, is you’re trying to limit your zigging and zagging as much as possible. Those zags are really expensive.
Eric: Also, to make sure that the line that goes through the center of all those zags is as at least pointing to the island that you’re going to.
Martin: Right. That’s where the ‘big hairy goal’ is in place. Especially, as a leader in an organization, even if you only have four employees. One of the things you want to do is make sure everyone, is as much as possible, moving in the right direction. Especially in a small company it doesn’t take that much work to make sure that everyone is aligned in the right direction. People go in their work for a day and they can do a whole day doing emails and not actually driving significant value to the business. That’s what I think, as an entrepreneur, you really want to make sure that all your people, every day, are driving value to the business.
Eric: Yeah that’s a good point. When people come to talk to me and they want to start something or do something, one of the recommendations I feel coming up for me is make sure whatever you’re looking to do you’re interested in. I find that the slow and steady wins the race thing still applies – even in today’s fast-paced market. If you do it slow and steady, the organic nature of that will take care of a lot of the … Quick success, I can’t even imagine from year one to year three we had gotten to where we were at year nine. It would have been way too quick. We would have had to get external funding and all these things to get your trademarks in order and all this stuff that has taken years – in a comfortable kind of pattern that fit with my lifestyle. There weren’t any sacrifices that I had to make on doing that process. Most of the time I enjoyed what I was doing because it was naturally aligning with my interests.
Martin: Yes. There’s not a lot of overnight successes, right? Going back to those three things that I was mentioning earlier about the first stage is figuring out the problem and the solution to that. You spend a lot of time there and if you get the right market fit with your product, which is really hard to do the first time. You’ll know you have a good market fit when your product is being pulled into the market, despite your best clumsy efforts, which is normal. Going back to that idea of the Valley of Death, what often happens right after the product market fit is you get enough success, especially from these early adopters, then you’re thinking like let’s just keep doing what we’re doing. Well that’s true. You want to to keep doing what you’re doing, you really need to start thinking about – now that we have a product market fit, how do we solve some of these fundamental problems with where our product is? Or rather the customer experience internally so that we can effectively now scale up and reach those late-stage adopters or those middle adopters. Which can mean you may have to change your product or update your customer service. Those people won’t accept a substandard experience. I always say what got you here is not what’s going to get you to the next stage. I talk a lot of about that with people. Let’s take that off the table. Don’t assume that that will work because 99% of the time it won’t.
Eric: One way to look at starting a business is it’s kind of like a sadistic, multi-level puzzle. The first level is really seductively easy. It draws you in. You solve that part of it and then you’re like, “wait there’s another puzzle underneath this?” The momentum of it forces you into solving the next puzzle. It’s not once you solve that than everything is done. No, it keeps going and keeps asking you to reinvent, widening your gaze. You have to constantly keep more things in your field of vision, which means letting go of the past things you got comfortable with and thought you were good at to move forward.
Martin: To your point on passion, one of my previous startups was a mental company really targeting young athletes. I spent a lot of time understanding that space and it was really helpful for me as an entrepreneur. You are absolutely right. If you are approaching this and you don’t have passion for what you are doing, it is going to be really hard to get through those tough times. They are are going to happen and you are more likely going to give up. That grit to keep working – that perseverance is much easier to do that when you have passion for what you are doing. Willpower is finite. They have done the research on this. Once you get up to the amount of forcing yourself to do something, that’s when that little voice inside you is like, “Martin you are an awesome person, you deserve to play video games and drink 20 malt Scotch tonight. Don’t do that hard task that you know you need to do. Let’s go have some fun.” That will win out eventually, especially, if you don’t have a passion. If you’re like, “oh but I love what I am doing for these customers, I love what I’m doing for these kids. Yeah, it’s hard, but man this is great. Hard, but great.”
Eric: It’s a mix between passion and obsession. I know when I was working through the support side of the MemberMouse business, that was not fun for me. I just came out of this phase where I was building and excitement and creativity, working with people one on one, really enthusiastic and optimistic. You get some success and you get people coming in and of course people are complaining that it doesn’t do what they want it to do. Maybe they are not on point with what they are saying, but you deal with 100’s of these week-in and week-out. It never stops. I had some ego built into my product because I built it. Every time they were saying something about the product, I felt a personal responsibility to it. That was a really hard position for me to be in. Passion definitely waned in that time, but my desire and what kept me going through that phase of it was a different passion. A passion to satisfy that need that those people said that they wanted. To do the right thing. I also learned through that process that there has to be a balance between what you are willing to give and what you are holding back. I started off thinking I would do everything for everybody. That doesn’t work. That’s not the right decision. Taking the zig-zag path to figure out where is the middle path. Each stage of the puzzle and the business too, I think there is a different alignment of passion. In the beginning it is a passion for the product then is became a passion for getting people what they want and satisfying the customer. Now the passion is more holistic. It’s like how do all these pieces work together? How does every little gear fit with itself and everything runs so that when this thing turns, and that thing turns, everything is efficient. It’s a neat puzzle that is specific to the person that is crating it. It knows where each of us need to be tested.
Martin: That’s very Jedi. You walk into the cave everyday as an entrepreneur and you are going to get tested on it. You know, I would say one of the top lessons, especially if you are a little newer to the workforce – Jeff Bezos has actually written this. If people don’t go out and regularly read his yearly Letter to Shareholders, they are awesome! I recommend everyone go out and read his Letters to Shareholders. He has so much golden advice on this. One of the top lessons that I have learned, and I’m sure you guys I am sure have learned is understanding when you are making decisions, what kind of decisions do you need to make. A good shorthand for that is – the impact and your ability to roll back that decision. For example, if you are going to fire someone in your company. That is not a decision that you can roll back on. So, don’t make it lightly. Obviously, there is going to be some legal impacts about this. You really want to think through big decisions that have a radical impact on your company, that cannot be easily rolled back. Some decisions can be rolled back pretty simply. Don’t get into a big debate as company about changing your landing page. Right? I see this all the time – we have to have a three-hour meeting about changing it he landing page. I’m like, who owns this? That person is going to spend half a day designing three different options. They are going to meet with a product manager, they are going to split-test them, based off some metrics and get them out. If we don’t like, or are not getting good metrics after two weeks on the landing page after split-testing, we can roll it back. Super simple. That’s one of the things I tend to work really hard on when first working with a company is – how do they make decisions. People typically have a default. Some people over-analyze. Some people go with their gut. Everyone, especially the important at the top, is really understand what kind of decisions you are making. Therefore, what kind of rigor and analysis do you need to put into this before we make it.
- Running Lean by Ash Maurya
- Jeff Bezos’ Annual Letter to Shareholders
Thanks for Listening!
Do you have any thoughts, insights, or questions about growing a business? Join our discussion and add a comment below. We’d love to hear from you!