"Our team is starting the arduous task of building a software product. How can I make sure that we finish this project and start generating revenue before the seed-money runs out?"
Barry, Owner, Senior Consultant
Barry has over 5 years of experience developing native mobile apps for clients, line-of-busniess mobile apps for fortune 500 companies, and original apps for the Apple App Store. Before that, he was building standalone SaaS applications that helped thousands of businesses serve their customers better.
Right now, more than any other time in history, it is incredibly cheap to start an internet company. The cost of infrastructure is as low as it has ever been, and the availability of open-source or free tools is phenomenal. The do-it-yourself'er has never had more power than he/she does now. However, the flip-side is that the marketplace for products has become extremely noisy with products. It takes a tremendously unique product offering and deep know-how to get even to a modacum of success, and it is never guaranteed. I like to describe the difficulty of certain business ventures as a spectrum...
I personally think this is a very fair assessment of things, however slightly pessimmisstic. The average guy with no experience and zero leverage (financial or otherwise) is going to find building an app business a similar challenge to say: passing the state bar exam and starting a successful law practice. Not impossible, and its very true that success here has more to do with your tenacity than your talent, but without some deep knowledge, connections, or an endless supply of marketing dollars, this is a hard road.
If you read the above, believed what I said, and are still reading, I'd say that chances are you've already made a massive leap in your chances of success. Why? Because even wicked-smaht folks like yourself generally have this notion of a product being able to sell itself "If you build it right", and its just not true. So, just the basic understanding of what kind of challenge you're dealing with here should give you an idea as to how serious you have to be to take a crack at this. This is not for the faint of heart.
Success Step #1: Aim Lower
No don't stop reading! You're on the precipice of knowledge, and its downright demotivating to hear this, but you need to hear it. Everything in your gut tells you to "go big, aim high", because its the idea that you've been sold by selection-bias-infused media. Don't listen. What you need to do is discover a business model that works, and you're playing against natural forces that are out to kill your venture: 1) your own growing apathy (the struggle is real) and 2) your limited resources. The clock is literally ticking, and you need to find what works before you run out of time. The answer is not to borrow a bunch of money and do some grandiose idea, but rather to take the core of the idea and build the simplest product you can around that idea, and put it into the hands of customers and see if they'll bite.
Success Step #2: Take One Thing at a Time
Related to #1 above, lots of companies, especially those with more money than patience, believe in the need to build everything at once. They believe iPhone and Android apps must be built in tandem, that the backend server must be perfect, that the website must include every bit of information necessary to run the business from day 1. And while there are businesses out there for which this is absolutely necessary, the vast majority don't need the entire stack of technology and marketing in place on day 1. For these cases, its just fine to just do the minimum. In fact, you'll increase your cost by a substantial amount by having everything ready-to-go on day 1. Why? Because inevitably you'll need to make changes to infrastructure, marketing messages, and so on... for every additional piece you add, you'll have to refactor code across the whole technology stack... and this will quickly add up to an insane overage in total project cost. No startups with horse-sense will try do to all platforms at once, but if you've got more money than patience...
To be continued...