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MenuHow do I do the right Market Research for a Product or App?
We have an idea to do a Social "Stress" app, where people can sign up as strangers and meet someone in their same "stressed" mode, like I was fired by my boss today and I find someone who did as well, and we are both Chatting about it. It'll also bring up some comedy for both of us and will be a "social stress reliever". Now obviously the idea is very 'wild', how do I "Test the waters" to see if this could be of an interest to users?
Answers
The best way to do validation on this idea would be to acquire customers through Facebook ads (rich targeting makes you able to cohort users nicely). Then, you could manually pair people via email or through a simple text messaging exchange facilitated by Twilio. In this scenario, you could prompt them to take the actions you think will be at the core of your app's functionality. Observing their engagement rate and what they do with each other would give you some insight into how viable this is.
Happy to talk this through in a call with you. I've helped a lot of clarity members through similar customer development exercises.
Testing your idea thanks to Facebook Ads might be great but I believe there is a better way. In my opinion idea extraction can be done completely for free and you can even get much better results from your research. Here it is what you need to do:
1. You to need to find a way to reach to your niche: through social media (think Facebook, LinkedIn groups, Twitter, etc.) and forums.
2. You connect with individuals directly and ask them about their biggest challenges and issues related to the problem you're solving. You try to find the pain point and then you present the possible solution. You ask about their honest opinion and you will be amazed by what kind of ideas they can give to you.
I can reveal to the whole method to idea validation/extraction that you can use to see if this is the right thing to develop and how you might shift it. Feel free to schedule a call with me if you're interested to learn more.
Here's what I always advise the start-ups that I mentor. Define your system on paper and run it manually in the real world with people that experience the problem you're hoping to solve.
To clarify what that would mean in your case, or how I would run it, would be the following way.
Either in my own offline or online social network (really doesn't matter which network you tap into) I would ask if anyone was fired today, or has recently had a major social stress situation. I'd then ask them to inbox me to say I have a "solution" for them. I would then wait for 2 people to contact me and then pair them up and run the "situation" in the way I had intended.
If you find that this whole thing falls flat on its face, you then have a good idea of how hard it will be to get people to "buy in" to your idea. If you find people approach you, then you know there is some merit.
Ultimately, it all comes down to doing all the "thinking" upfront and then applying it in the real world in a manual fashion. That's your validation.
Feel free to call me if you want me to talk you through it in an exact step by step fashion.
Market research is developing an extensive understanding of the customer. The insights help in developing innovative marketing strategies. As an app development company or app-entrepreneur, you may want to know the best ways to conduct market research. You might want to start by determining how you will position your brand in the market. To market your app, start with defining your target audience. The research findings will help you attain that edge by building innovative features into your app, integrating usability aspects, and remaining relevant and original. You can strengthen your app’s core when you conduct a SWOT analysis. A business plan is a roadmap and includes aspects like sales, revenue, market, and profit. You will get more confident and get a better understanding of the market as you explore the various facets of market research. Next, let us look at some effective marketing strategies that are important for mobile app success. App stores are one of the first touchpoints for potential customers to discover your app. You could find influencers on LinkedIn, Buzzsumo, and Crunchbase. Collaborating with influencers can be mutually beneficial and help to promote your mobile app. Offering potential customers a benefit when they endorse your app online is a definite way to gain word-of-mouth for your mobile app. You might track them through metrics, including churn rate, session length, time in-app, daily active users, and cost per acquisition. These key metrics will bring in exciting insights on what worked well and what did not. A blend of the old-and-new will get you some hard-hitting market strategies for your mobile app.
Besides if you do have any questions give me a call: https://clarity.fm/joy-brotonath
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What do (bootstrapped) startups offer to new sales hires? Commission only? What are some good examples to keep people motivated and still survive?
Generally bootstrapped startups should avoid salespeople, for a few reasons: a. they typically can't afford the base and overall comp required to attract sales people who can actually sell / or afford to support them with marketing, management, etc b. it will be very difficult to find the rare person with the right mix of sales and startup DNA along with the critical domain knowledge, consequently the startup is likely to settle c. the founders need to be very involved in the selling and customers will demand it That said, if the plan is still to hire a salesperson, find someone who has demonstrated sales success in startups and is excited by the early stage in company building. Create a comp plan heavily leveraged on sales results (unless you are in an industry where 100% commission is a common practice, would recommend against $0 base as this creates the false impression that your hire isn't passing time with one company while looking for another job with a richer comp plan - you want your rep focussed). Sell the vision and opportunity to be part of a growth story. I have written a several blog posts on hiring sales people into start-ups. You might find these useful: http://www.peaksalesrecruiting.com/ceo-question-should-i-learn-to-sell-or-hire-a-sales-person/ http://www.peaksalesrecruiting.com/start-up-sales-and-hiring-advice-dont-stop-selling-once-you-hire-your-first-sales-rep/ http://www.peaksalesrecruiting.com/hiring-start-up-sales-reps/ http://www.peaksalesrecruiting.com/startups-and-salespeople/ Good luck!EB
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How much equity should I ask as a CMO in a startup?
Greater risk = greater equity. How likely is this to fail or just break even? If you aren't receiving salary yet are among 4-6 non-founders with equivalent sweat investment, all of whom are lower on the totem pole than the two founders, figure out: 1) Taking into account all likely outcomes, what is the most likely outcome in terms of exit? (ex: $10MM.) Keep in mind that 90%+ of all tech startups fail (Allmand Law study), and of those that succeed 88% of M&A deals are under $100MM. Startups that exit at $1B+ are so rare they are called "unicorns"... so don't count on that, no matter how exciting it feels right now. 2) Figure out what 1% equity would give you in terms of payout for the most likely exit. For example, a $10MM exit would give you $100k for every 1% you own. 3) Decide what the chance is that the startup will fail / go bankrupt / get stuck at a $1MM business with no exit in sight. (According to Allman Law's study, 10% stay in business - and far fewer than that actually exit). 4) Multiply the % chance of success by the likely outcome if successful. Now each 1% of equity is worth $10k. You could get lucky and have it be worth millions, or it could be worth nothing. (With the hypothetical numbers I'm giving here, including the odds, you are working for $10k per 1% equity received if the most likely exit is $10MM and the % chance of failure is 90%.) 5) Come up with a vesting path. Commit to one year, get X equity at the end. If you were salaried, the path would be more like 4 years, but since it's free you deserve instant equity as long as you follow through for a reasonable period of time. 6) Assuming you get agreement in writing from the founders, what amount of $ would you take in exchange for 12 months of free work? Now multiply that by 2 to factor in the fact that the payout would be far down the road, and that there is risk. 7) What percentage share of equity would you need in order to equal that payout on exit? 8) Multiply that number by 2-3x to account for likely dilution over time. 9) If the founders aren't willing to give you that much equity in writing, then it's time to move on! If they are, then decide whether you're willing to take the risk in exchange for potentially big rewards (and of course, potentially empty pockets). It's a fascinating topic with a lot of speculation involved, so if you want to discuss in depth, set up a call with me on Clarity. Hope that helps!RD
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How can I become an idea person, as a professional title?
One word: Royalties This means you generate the idea and develop it enough to look interesting to a larger company who would be willing to pay you a royalty for your idea. This happens all the time. Rock stars, authors and scientists routinely license their creative ideas to other companies who pay them a royalty. Anyone can do it. Your business, therefore, would be a think tank. You (and your team, if you have one) would consider the world's problems, see what kinds of companies are trying to solve those problems, and then develop compelling solutions that they can license from you. You have to be able to sell your idea and develop a nice presentation, a little market research and an understanding of basic trademark and patent law. The nice thing about doing this is that if you develop enough cool ideas you will have royalties coming in from a lot of different sources, this creates a stable, passive revenue stream that requires little or no work to maintain. Start in your spare time and plan on the process taking 3-5 years. Set a goal to have a few products in the market that provide enough revenue (royalties) to cover your basic living expenses. Then you can quit your day job and dedicate more time and increase the momentum. A good idea business should have dozens, if not hundreds of license contracts generating royalties. It's possible to pull this off. And it is a fun job (I'm speaking from experience).MM
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What is the average series A funding round at pre revenue valuation for a enterprise start up w/cutting edge tech on verge of our first client.
With all respect to Dan, I'm not seeing anything like that. You said "pre-revenue." If it's pre-revenue and enterprise, you don't have anything proven yet. You would have to have an insanely interesting story with a group of founders and execs on board with ridiculous competitive advantage built in. I have seen a few of those companies. It's more like $3m-$5m pre. Now, post-revenue is different. I've seen enterprise plays with $500k-$1m revenue/yr, still very early (because in the enterprise space that's not a lot of customers yet), getting $8m-$15m post in an A-round. I do agree there's no "average." Finally, you will hit the Series A Crunch issue, which is that for every company like yours with "cutting edge tech" as-yet-unproven, there's 10 which also have cutting edge tech except they have customers, revenue, etc.. So in this case, it's not a matter of valuation, but a matter of getting funded at all!JC
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how to start earning on clarity.fm
Most of the earnings come from the people you are in contact with. The platform is not that big at the moment but it can be earned. My recommendation is to create content on your private page web, facebook, instagram ... and leave a clarity link through your work. If you need extra help call me for 15 minutes.DB
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