An awesome Stanford student who I mentor emailed me with the question below and I thought that I’d share his question and my response with LinkedIn:
However, one question I had for you was, “how exactly do you go about STARTING a startup?” I always have ideas for apps and for products, however they never evolve from that stage. As you once told me, if you have an idea, there are probably 10,000 others with that idea, 1,000 others who have written up something about it, 100 that have actually taken action and started a company, and 10 that have had success (probably not a perfect quote there lol, but when you said that it stuck with me.)
Anyway, I feel stuck in that group of 10,000 people with ideas but nothing more. Most recently, I have had this idea for an app that I would really like to run with. I have one other person who enjoys marketing and business that wants to go into it with me, however I have no programmer and nothing more than my idea. I just wanted to see if you had ideas for first steps. I was thinking that researching and writing up a business plan would help, but what do I do from there? Any advice you have would be awesome. If it would be easier to speak about it over the phone that would be awesome, I just know that you are super busy, so whatever is best for you would totally work for me. I just appreciate any advice you have since you have always been incredibly informative and helpful to me in the past.
Your question about how to actually start a start-up is a great one…but also a really hard one.
Before taking a quick stab at an answer, I’ve found it helpful to first remember what a start-up really is. I like Steve Blank’s definition of a start-up: an organization which is attempting to discover a scalable & repeatable business model. Once you’ve found that business model – once you’ve demonstrated how you make money consistently – then you’re no longer a start-up. Your organization is a company which has the mission of expanding that model, making it more efficient, automating that model, becoming profitable, gaining market share, entering new markets, creating new product lines, etc etc (whatever’s most important for the business at that time).
If you buy that definition for a moment, then I think your question of “how exactly do you go about STARTING a startup?” gets a bit easier to answer:start your search for a scalable and repeatable business model. More specifically, the very first thing I would do is get out (of your own brain) and talk to people outside of the organization. Talk to potential customers. Talk to experts in the chosen sector. Talk to people who don’t know jack. Talk to anyone and everyone who will listen. Tell them what you’re working on and ask them what they think. Ask them if they would use it. Ask them if they would pay for it. Gauge their reactions. In most cases, you’ll get feedback somewhere between “I want this right now. How can I get it today?” and “That’s the stupidest thing ever. Can I punch that dumb idea out of your head for you?” Ask a lot of follow up questions too. Find out WHY people love or hate an idea. Try to discover which parts of the idea they like the most/least.
Over time, these answers (and who said them) will confirm or reject your hypothesis and, of course, give you new ideas to test. You can even land paying customers this way before you have a product – I’ve actually done this! Then, and only then, should you start to build your very first prototypes (finding someone who is interested in helping you build it gets way easier if you’ve done the above well too!). If you’re intentional about this first step, you can do it in a few days. But the key is to stop believing your assumptions about the world and go out and test them with real people – especially people who might use your product or service.
Also – watch out for inconsistencies between what people say they would do and what they do. If someone says they’d buy your product, tell them that they can pre-order it right now. Tell them that if they don’t like what they get, that you’ll give them a 100% money-back guarantee. If they say they’ll buy it but won’t, then they’re a potential customer and not a customer. You’ll run into this exact phenomena once you’ve finished your Minimum Viable Product too. People will say that they’ll buy or use your product but then won’t! These folks are far far more dangerous and less informative than people who make it clear with their actions that they either will or will not pay you or use your product. Decoding who falls into which bucket is not easy though!
There’s obviously a lot more between this stage and a billion dollar valuation, but this is a great START to getting a start-up off the ground!
Other ideas? Tell me in the comments