Being an entrepreneur and creating a startup business can be a lonely endeavor. Following are excerpts from an article by Jason Cohen who addresses this issue and lists 10 questions you should be asking yourself each and every month. To read the entire article go to http://blog.asmartbear.com/startup-business-plan.html
Therapists don’t tell you what to do. Rather, they ask probing questions that get you to discover for yourself what is true for you, your situation, and what you want.
You’re smart. You’ll make good decisions. But you also get bogged down in daily minutiae and putting out fires, meanwhile missing the big picture.
That’s where this article comes in: To splash cold water on your face, forcing you to face reality and continue to defend or change the important choices inside your business.
What follows is your startup therapy session. Having to think through and answer these questions forces you to identify what you need to do today to seek profits and growth.
1. In one sentence, what does your product do and who buys it?
2. In one sentence, why does someone buy your product?
These are surprisingly difficult. The shorter and more precise your answers, the more you understand why you exist. If the answer is, “I honestly don’t really know why people give us money,” that’s something to remedy immediately.
If you have an answer, is it because you have hard evidence that this is how your customers perceive you and why they give you money, or just because you believe it? “Evidence” means emails and Tweets and testimonials that use those words exactly; otherwise you’re likely interpreting their feedback to match your expectations. (I find myself constantly guilty of this disconnect.) If you don’t have evidence, it is OK to have a hypothesis but you should be concerned about collecting proof and disproof.
If you do know the answer, these two sentences should drive your marketing efforts. If these sentences aren’t on your home page, why aren’t they? Is there anything else more compelling to potential customers? At the least, these represent the themes that drive your marketing campaigns.
3. What one thing is most responsible for preventing sales? (e.g. people not knowing you exist, pricing, not enough product features, unorganized sales strategy, look-and-feel of website, haven’t identified pain points, …)
Most little companies aren’t honest about this, yet it’s possibly the most important question you could ask. For example, I’m an engineer, so my first answer to “Why don’t you have more customers?” is almost always: “Because we need this feature.” You hear some potential customer say “we will buy if you do XYZ” so you conclude that if you implemented XYZ people would start breaking your door down.
But is that really the case? If you added one feature and maybe satisfied thatone customer (assuming they wouldn’t ask for a second thing, and in my experience they usually do), would that get you 100 more sales? For those hundreds of people who downloaded your software and never bought — is the reason “not enough features?”
For the hundreds of thousands of people who never came to your website in the first place, or hit the front page and left after three seconds, is the solution “more features?”
When you honestly ask yourself this question, it will naturally lead into things you can do right away to get more people to the site, into a trial, and/or into a sale. Don’t just rest on what comes easiest.
4. What’s one thing you could do to get more feedback from customers, potential customers, or sales you’ve lost?
You already know that external feedback is the only way to empirically determine how to build products people want to buy. Maybe you can’t drop everything to solicit, but surely it’s worth one day every month to go out of your way to collection information from the field.
5. If you had zero revenue from now on, on what date would you run out of money? The first thing this does is force you to nail down your monthly expenses and accounts payable. Second, you know the length of your fuse even in event of disaster (if you have revenue) or if you never manage to land a customer (if you’re just starting out).
More than that, knowing your “padding” as I used to call it is helpful in making decisions. Finally, knowing “The day my business could die” helps focus your attention on activities that bring in revenue.
6. If someone handed you $100,000 today, how would you spend it to maximize future profits?
This gets you to crystallize what cost-centric activities would most help your business. Sometimes it’s still true that “you have to spend money to make money.” Sometimes the “thing you could do” is so compelling, it might mean you should raise a small angel round or consider debt. Typically it’s best to get by with minimal debt and investment, but if the “thing you could do” is transformative, you might reconsider.
7. If you were forced to hire someone today, how would you define her job such that she would contribute enough revenue to cover her expense?
I know, you can’t afford anyone right now, no one can do as good a job as you, and you don’t even know that you’ll ever hire someone. That’s OK, that’s not the point of this question. This gets you to ferret out what tasks are being dropped by the wayside because you’ve got higher-value things to work on, because you’re having to fight fires, or maybe because you’ve got your priorities wrong. If you honestly can’t imagine that there’s anything a full-time person could do that would generate enough revenue to cover their salary, that’s not a bad thing. But often this churns up one or two very-part-time tasks which really ought to be done but aren’t. No need for a new employee of course, but maybe you should re-prioritize those tasks next month.
8. Which of your business operations do you hate?
Do you like creating new features but hate tech support? Enjoy product demos but hate cold-calls? Need to have your arms around company finances but hate bookkeeping? Love writing ads but hate dealing with ad sales agents? Get excited about your field of expertise but hate writing blog posts and Twittering?
It’s useful to identify these undesirable-but-necessary tasks because you can do something about it:
- If you shut off email, Twitter, chat, and the phone, and just buckle down, you might be able to get through some of these tasks in under 15 minutes. Bookkeeping is like that. Get it off your plate; you’ll feel better.
- Consider an intern or consultant. Before you argue that the cost is too great, factor in the lost revenue due to you working on those tasks.
- Can you share the burden with your co-founder or employees?
Act as if someone is paying you $1000/hour for any activities that improve sales (making, selling, and your customer’s happiness), and for everything else they’re paying you $10/hour. It’s accurate. (Before you argue, don’t forget about the cost of lost sales.)
9. What initiatives could be done half-assed without significant impact?
If you’re like me, you are that aggravating combination of perfectionist and control-freak that on the one hand leads to stellar work but on the other hand means some things take too long. Some parts of your business are core to your success: Which features you implement, how you present yourself and interact with customers, discovering how and why people give you money.
But the fact is your to-do list is infinitely long and you have to pick your battles. Your “Contact Me” page has to exist but it doesn’t matter what it looks like. Every blog post doesn’t have to be a work of art. Your Google Ads need variety (for testing), not hours of wordsmithing. It’s better to have an eBook about anything than to have no eBook at all.
10. If you could get one solid hour of advice from a guru you respect, what would you discuss and what would be the goal of the meeting?
This is a fun way of asking: “What knowledge/feedback/direction is critical to your business right now, and which you’re uncertain about, and which you feel other people are expert in?”
Phrasing the question this way also leads to solutions. For example, maybe you should set aside 4 hours to get your hands on that guru’s materials (blog, book, podcasts) and immerse yourself not just in advice but in their mindset. Or email them and see if you can get some advice! Or find other people that guru respects and who might be more accessible.