Why Market Validation is Crucial
Welcome to the first post of many! The goal of Where it Went Wrong is to break down why startups failed and what can be learned from them. The goal is to share stories and case studies from the maker community on a subject that gets touched on a lot, but rarely in-depth.
Failure is an inevitability in the startup game, and if you haven’t failed yet, please send me a message because I’d love to invest! (For real, send me a message) The truth is that it’s harder to deal with failure than most people like to acknowledge.
About me and where this started
My name’s Nick. I’ve been making projects and websites for the past seven years, but only really got serious about it two years ago at the beginning of 2017. The project I settled on was called Resume Sorter.
As the title suggests, the purpose was to parse resumes – at the time, it seemed kind of novel to me, and I thought it could be a useful tool for smaller recruiting agencies. I thought there was an opening between what large corporations were using and what I was going to offer. This is the part where alarm bells should be ringing. Loudly. I was already making the following assumptions:
- There was a need for this
- That I had a viable target audience
Both of these things should be validated before much if any work has been done. As entrepreneurs, we aren’t our target audience almost every time we create something. Anything we do is based on assumption and needs confirmation with more than one person in that field. Even then it’s not a guarantee, but a good start.
The work is done! Or is it?
Was there a valid need for this product? It’s hard to say that there was when I didn’t know anyone actually doing this. It’s an easy trap to fall into inventing a problem to solve when you’re coming up with ideas.
My tendency to jump headfirst into projects and my lack of experience at the time made for one hell of a combination. I had a plan: make a desktop application and charge monthly for it. For the second time, you might be hearing some sirens in the distance.
At the time, I was working for a company that had a desktop program. My logic was if it worked there, why not here? I’ll admit that this isn’t nearly a mistake of the same caliber as the first (not validating the problem/solution) So what’s wrong with it?
I won’t say desktop programs are a thing of the past, but when it comes to user acquisition, it adds additional steps that aren’t necessary. Instead of a web application flow:
Customer hits website -> Enters email -> Starts trial immediately
You get a really old school flow:
Customer hits website -> Enters information -> downloads -> installs -> tries program
It’s only a difference of two steps, but the amount of effort is too high. If a product isn’t solving a real pain that the user needs a solution for, they aren’t going to make it all the way through.
One website that really gets this right is Carrd. If you’re not familiar with it, Carrd is a one-page website builder that you can get started using almost immediately, for free.
It’s a shining example of low friction in the acquisition process and a joy to use. I enjoyed using it so much that I moved my indie game website Zever Games over there in a short amount of time from WordPress.
My program on the other hand…
Anyways, I had this clunky program that after spending four months of my time after work coding that could do the following:
- Bulk parse resumes
- Sort them according to positive/negative keywords
- Check for spelling errors
- Generate a report based on the above
The problem with the above? It’s all based on assumption. An MVP (minimum viable product) should focus on solving one problem and launch. The reason being that the product is most likely going to change as you get feedback from those first few users. Don’t waste time on bells and whistles at this almost primordial stage.
It was a lot more complicated than it sounds and for not offering crazy features, it took a lot of work to get working as intended. Writing algorithms that could tell names, emails, and phone numbers from spelling mistakes is like making a multi-stage water filter by hand.
By this point, I was going into marketing mode with a plan of Bing Ads / Google Adwords, as well as reaching out to people on LinkedIn.
During this time, I only got a few downloads and one person that was “interested” on LinkedIn. I suspect that person was a saint in disguise that wanted to humor me.
In the end
After a few weeks of this, I realized that it wasn’t going to work and pulled the plug on the project. It had caught up to me that I hadn’t validated this and I wasn’t particularly interested in proving it with recruiters.
This last part was a more subtle lesson for me that has taken me a while to internalize: If I don’t have a genuine interest in what I’m working on, why the hell am I doing it?
The significant benefit of taking a genuine interest in what I’m working on is: my motivation isn’t fleeting; it’s rooted in something far more profound than surface level. That means that the value I provide to users will be higher just by default.
That’s the sweet spot for me where speed bumps in the process don’t slow me down. I might even get some air off of them.
End statistics and details:
- Monetization: SaaS
- Time spent: 4 months part time
- Money spent: $100 – $200
- Revenue: $0
- Tech stack: C# / Visual Studio
The lessons I learned with this project led me to indie game development, where I’ve had some success. Nothing earth-shattering of course, but a big step up from $0 🙂
I’ve always had a passion for business, and it’s my goal starting this site that I’ll have a lot of valuable lessons to share with the community. If you have a project that took a nosedive from 30,000 ft, I want to hear from you! Send me an email/tweet and let’s get the ball rolling.
Enjoy this content? Don’t be shy – I’m starting a newsletter with one new case study this week.