Entrepreneur mistakes I made – Part Deux
I invented NOAH, an animated character technology for online applications. It was very effective and successful for online training projects, bridging the gap between instructor-led and pure online coursework. We adapted it to work on our website, a cute little avatar flying around and pointing at things and explaining benefits and action items, popping up graphics in the middle of a speech, and so on. Several (I stress the word “several”) people mentioned how cool it was, so I, being the addicted entrepreneur I am, decided to expand the product line by developing NOAH for websites.
The new product required an easy interface where customers could build their own avatar and design what it said and did on the page. That was expensive programming. And, we couldn’t resist adding every cool feature we thought of. After 8 months and lots of dollars, we launched it.
It was a party that no one came to. We’re waiting. We’re waiting. Nothing. A competitor, SitePal, seemed to be working (we really didn’t know how well it was doing), so we figured we’d just keep marketing it a things will work out. They didn’t. No one (OK, we had two customers) was interested. I was really surprised and disappointed (and poorer). Big dud.
Here are the mistakes. First, I did absolutely NO customer investigation. I thought that since I thought it was a good idea (and how could I possibly be wrong?) that a lot of other people will just somehow agree and jump to buy into the vision? Sound familiar? This is often the biggest mistake many early stage entrepreneurs make. I figured that if it succeeded in one environment, it would certainly succeed in another. The fact was that training developers and website developers and incredibly different, no similarities AT ALL. I didn’t even consider that their motivations, problems, needs for solutions, and so on, were light years apart. I had my feet in both worlds, but rarely would I find prospective customers that have the same shared bag of experience. I didn’t consider that.
Secondly, I allowed the company to be distracted from building its core competency and revenue base before testing new products and markets. The training products suffered and the money I should have used for marketing was used up in a failed project.
We also discovered that just because a competitor LOOKS like they have found a market in which you can compete, it does not mean they are successful at it, or that it’s big enough for two players
Had I faced this today, being SO much wiser, I would have built an interactive mockup of the product and presented it to website developers, either individually or at a conference of some sort. Had I done that, I would have found out they didn’t really think site visitors would be attracted to a cute little talking avatar. In fact, they thought it would be a big distraction. I would have saved a whole lot of time and money if I had just ASKED prospective customers. I would have looked closer at how SitePal was really doing. I honestly didn’t know.
You live, you screw up, you learn, you move on. And, sometimes, you write a book hoping to help other entrepreneurs avoid stupid mistakes you made.
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Can a Venture Capitalist Buy a Country?
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When an American private equity firm orchestrates a devastating war between two powerful drug cartels and a partnership with two others, a new nation is born.
But when the sinister purpose behind the primary investor is revealed, grave mistakes may destroy America.
Only two young FBI agents can stop it in time.