Validating Your Business (special guest: Noah Kagan)
Validating Your Business (special guest: Noah Kagan)
11. Validating Your Business (special guest: Noah Kagan)
Start-Up Tips (special guest: Philippe von Borries)59:47 3
Case Study: UniversityParent.com11:28 4
Hacking a Non-Profit (special guest: Leila Janah)29:00 5
The Creative Process (special guest: Neil Strauss)1:02:24 6
Learn Any Language in 3 Months!22:43 7
4-Hour Body Introduction15:30
Mobility (special guest: Kelly Starrett)45:33 9
Strength (special guest: Mark Bell)54:35 10
General Q&A10:10 11
Validating Your Business (special guest: Noah Kagan)1:05:17 12
Self-Defense (special guest: Dave Camarillo)31:19 13
The 4-Hour Chef27:51 14
Basketball (special guest: Rick Torbett)27:30 15
Archery (special guest: John Jackson)23:56 16
Validating Your Business (special guest: Noah Kagan)
Where to even begin? I think where we should start is, perhaps, just telling people a little bit about AppSumo and how it came to be, would be perhaps a good place to start, if you'd like to start somewhere else, we can. We can start whenever. I mean, I think what's interesting is kind of the journey of how I got to AppSumo. Well, let's talk about that. So, a lot of people out there, maybe some of the audience, some of the fans, some of the people watching, I've had a pretty, I started off with a really crappy job. I started at Intel, one of the things I was known for was sleeping under my desk. I brought a sleeping bag, like I would position the chairs, I'd bring candles. And I hated my job, and I was working, I was literally working the one hour work week, where I didn't do anything. And I wanted to change, so I ended up just kind of sending my resume to Facebook, and that kind of started me off into the start up world. And from there, Facebook, I was able to build a lot of pro...
ducts. They kind of, I think some of you guys may have heard of 'em? Anybody in the chatroom heard of Facebook? You worked on the ad platform, also. I built Facebook ads, did Facebook mobile, Facebook status updates. And it was one of these things where I think a lot of people who were building businesses, you kind of have to do, I really, what I found is you have to really be doing what you're interested in. And things that you're using actively. 'Cause my mom and my grandma and my family were like, "Facebook, what is this Facebook? MySpace is killing them." My mom's like, "I saw him on Oprah. "I saw MySpace on Oprah. "You are screwed, what are you doing? "Stay at Intel." And, you know, it was just like, I really love what they were doing, I was really excited to be going there. I think that's a really big takeaway for a lot of people is just think about what you're already interested in using or doing. Or think about what you're doing in your weekends, and you're like, alright, how do I make a business out of that? And so from there, I was able to, you know, after Facebook, I went to mint.com and then a few years later now I work at appsumo.com. So, AppSumo, for the people that don't know, we promote cool products. That's really... And AppSumo is yours, also. Yes. It's the first, I kept getting fired. People are like, why are you an entrepreneur? And I was like, I either get fired or let go, and you know, I finally, I wanted to have the say and have the freedom to run a business the way I wanted to run it. Awesome. Yeah, it's been an interesting story, an interesting journey. So, entrepreneurs, this is just a side note, so entrepreneurs and chefs have actually a lot in common. They're both totally crazy, generally. And people are like, oh, that's so courageous of you to be an entrepreneur. Or that's so courageous of you to like follow your passion and become a chef. Nobody else would hire me, you know, I'm unemployable. There's nothing else. You know what's interesting about that is that like I'm actually risk averse. Most people think entrepreneurs, oh, you ride motorcycles, OK, I do, I do ride motorcycles. But they think you like jump off cliffs and you do all these kind of crazy stuff, but I actually don't start businesses until I know they're already working. So I didn't quit mint.com until I already knew that my next business was going. And I didn't leave that to do AppSumo until I already saw that people were wanting what I was working on. And so that's. So people think of me as this crazy risk taker. I'm actually not, I don't view myself as a risk taker. And when I started my first business, same thing. Before I left, well, actually, our whole entire sales division was fired, but before that happened, the, (laughs loudly) Before you were let go. Before they like dismantled and imploded, I had it up and running and prototyped it. And that's something I've been really impressed with when I've watched everything that you've done is these prototyping, testing, iteration, validation, all of that. So maybe you could talk a little bit about what you mean by, I only start businesses I know are working, or will work. Exactly. That's a foreign concept to a lot of people. Yeah, so, I think maybe I'll say a little of the counter of it, where I've spent, I was calculating it last night, I've spent over 12 months of my life and over $100,000 in things that have not worked. Right, so I keep doing these things that are not working, I'm like, well what actually will work? So with AppSumo, specifically, I was like I want to spend as little money as possible, and I want to spend as little time as possible, to know if it works. And then if it doesn't work, Okay, fine. I'll accept that and move on to something else. So with AppSumo, you make a hypothesis. That's all your businesses are. It's a hypothesis. I think people are fat and I want to help them through this method. Or with AppSumo, I said, I want to promote digital products. That I think are just really great for startups. And so what you try to do is, how do I minimize the amount of time and money to do that? And so with AppSumo it took me $60, and about a week, give or take, to actually understand if that was a viable business. My hypothesis was, could I get 200 people to buy a digital product online for startups? And so, what most people do in business, this is very common, I actually call it an engineering disease. If you're an engineer. You guys are smart, is anybody here an engineer? Anybody, no, yeah, it's okay, have some pride. You're smarter than everybody else here. Right, any engineers who watch, you guys know you're smarter, it's fine, I've accepted that, but engineer, what you do, is you love to build really cool shit. Right, it's really great to build something, and then you go out with it and you're like, "Anybody want this, anybody want this?" Right? I'm sure the people online know that as well, so I like working backwards. I like going to a customer and trying to understand, all right, what is the problems you're having. Maybe in message boards or forums, like what things people are already talking about. Like go to a message board, go to, I think it's bigboards.com, you can find message boards on any topic. Big Boards. Big Boards, yeah. And you can see people complaining about things. And then you can actually go and solve that problem. So with my hypothesis with AppSumo, how I did it in the week and with 60 bucks is I went to reddit.com, and I said, all right, what are they really talking about? What products are they using? And they're using Imgur, which is a photo hosting. A lot of you guys know like the memes, you probably see all these weird memes online, and a lot of them are at Imgur. I know in our office they pass them around. Anyways, so for 60 bucks, I basically was like, well, they're talking about Imgur on Reddit, so I know where my customers are, I know what the product they actually want is, and I went to Imgur and said, "Let me sell this for you." I will go promote this online, and I contact a guy in Pakistan, his name is Muhammad. You could e-mail me at AppSumo, I'll give you his contact info. And he's 12 bucks an hour. And so I had him build the PayPal button. And then I went on Google and searched how to build a site. I really did, I went to Google. And so I took that code... That must have pulled up a lot of really legitimate websites. It was, yeah. (laughing) How to build a website. That's totally valid. I'm just giving you a hard time. No, but I basically, I searched at Google like how to build a registration page. And even now I can do it more ghetto. Now you don't even need to do that. Now you literally just need your PayPal e-mail. Like, hey what do you want? And so people in the beginning, I posted on Reddit, because that's where the customers are, as we talked about, and then people would start buying it. And I didn't build any really complicated backend. I literally manually e-mailed everyone who bought. So once they bought, I got an e-mail and I was like, all right, let me go send you the product, send. And what happens with a lot of people as they're building these businesses are like, "Well, I need all this backend complexity and I need to send them these things." And it's like, do you actually need that? Or can you really just do it manually for the time being and seeing if people want it? Yeah, I need to scale. It's like, well why don't you make sure one person's gonna buy it first? Yeah, please don't say the S word. The S word. We're live. I know, I'm sorry. And that's funny because so many people have, you know, we're gonna talk with some people today, they have these fantasies about oh, I'm gonna have all these COOs and CEOs and CTOs and how am I going to get a million customers and all these things and it's really like, I call it the velocity to one dollar. How can you really just break to your first dollar? And once you can start getting in that mindset, it really changes your perspective about how am I going to get this business really working versus all the playing business. And, (sighs) I think one of the points that you made is really, well, they're all important points. And for what it's worth, in everything that I've done, we're 100% on the exact same page. There are different ways to skin the business cat, but this is the risk averse cost minimal way. And one thing I did, I haven't actually said this before, when I wrote the Four Hour Chef is I polled all my readers for their favorite cookbooks of all time. If you could only choose one or two, which would the two be that you would choose, and you could never buy another book. Then I had an assistant help me, and you can do this yourself, certainly. Narrow that down to only books that had an average of 4.5 stars or higher on Amazon. And then I looked at the three star most helpful reviews or most critical, most helpful, and looked for the things that they identified as missing in those best books, and then I made a running list of all the things that were missing from even the best books. Like in barbecue, they neglect brisket a lot. I was like, okay, great. Like we're gonna do short ribs, brisket, it's gonna be in my book. And I made like a hit list. Because I knew the market was there. That's a really, I don't know if you guys got that. You should almost like, just to repeat what you're saying. I'm not plus one-ing you. I'm plus zeroing you. Is that, like these customers on Amazon have already bought something, they're already telling you what's missing, and now you can go serve them. And that's not just on Amazon. It's on message boards, it's on Twitter, that's on Facebook, people are already telling you what they want solved, so that's awesome. Yeah, like knife skills, like solved. Problem, problem, problem, okay, solved. They're already spending $100 on two, three books to try to figure it out. So let's, I mean, we could jump straight into, we're gonna do the case studies, but what are some other common mistakes, or rules of thumb that are your pros, like your go-to rules. Yeah, I wrote them down. I put them in the ten commandments. I put them in my little black book. A lot of these are from... Let me share some of the stories of what I've gone through to help you guys. Understand and I'll relate them to some of the things. I call it the totem poll problem. And what the totem poll is that, Tim? Would you pay me $50 to take off your shoes every night? No. $50 to massage my feet after the shoes come off maybe. Okay, that actually right there, that's what interesting. And some in the totem poll affect, there's on the bottom of the totem poll is shit. Right, so you're like I'm not gonna pay 50 bucks to take off my shoes. But, what did you say afterwards? I said if you took them off and then massaged my feet. Right, so now as we move up people on the totem poll, it's like, well that's actually a higher value proposition, that's a higher problem I'm solving for you. And what I... And so what you really need to consider is where are you on the totem poll with your customer? And what happened with me in the past, is that I did credit card processing. So we powered Zynga's payments, and Tagged, and Area games, and none of them woke up and said, "Man, I really can't wait for Noah to do our credit card processing today." Right? Cause I would call them in be like, "Hey, guys it's Noah." and they're like, "Noah, who?" Right? And then I said well tell me what are your bigger problems, what are you actually wanting. And they're like well really want customers. Right? So I was like, alright that's higher on the totem poll. So realize where you are on the totem poll with your business. Second key, key thing that I've started noticing, it's a really big trend with want-a-pre-neurs that we're tryna kill. Alright, we want these people to all be entrepreneurs and successful, You got the term right? Want-a-pre-neurs? Yeah, it's that they need time limitations. And you actually talked about, Yeah. This in your first book. Yeah. I believe it's Parkinson's Law. Yeah. Right, so you... What happens is people extend time. And it allows them to just keep going and going. But the creativity comes when you reduce the money. So with AppSumo we were spending almost over a quarter million dollars a month in advertising. Yeah. And when you cut that down to now about 10 thousand a month, you actually... Should I want the same results or more, how do I be creative? Yeah, yeah. Right, so with the want-a-pre-neur-ing, instead of you have three month to validate your business, and see if people want it. Yeah. Spend a week, spend a weekend. Yeah. Spend tonight, like literally after the show today. I think it ends all at 9:00. Go and finish the validation that you've been having on your checklist. And the fact that you only have three hours to do it, like we're gonna do today, Yeah. with some of them, will shift your mindsets. One major, major thing... Two other things I really, really wanna highlight, is accountability. Yeah. I'll tell a depressing story of kinda... Two weeks ago we brought in five entrepreneurs to the AppSumo office in Austin. We walked them through their business, we made sure it was what they wanna be doing, we literally mapped out what they were gonna being doing. Their due dates, their commitments, and then two days ago we emailed them and said, all right guys, we gave you everything you need. We gave you the blueprints, we walked you through it, you kicked ass, right? Like we feel really good, this is what makes us feel really good as well. Seeing you guys get the results. And can anybody guess, can you guys guess what happened after a two weeks? Nothing. Can we al do it at the same time? One, two, three. Nothing. That was weak. (laughs loudly) Nothing. Wasn't that weak as shit? One, two, three. Nothing. That was better. That was like Happy Birthday at a restaurant. They're like, Happy Birthday. (groans) I... (laughs loudly) Yes. Next time, notice that at restaurants, the Birthday song. But nothing happened. Nothing happened, it was really disappointing. Yeah. And so what I've noticed that's a key thing for people that'll break through the inflection point or when there's a little bit of hardship, is accountability. Yeah. So a real account, but not like... Oh you didn't do it, whateves. Yeah. Right someone who'd like, hey what happened today? And hey maybe you need a punishment. How have you seen that done for entrepreneurs, like... Yes. What's a good way, to set that up besides having Noah Kagan kick you in the ass. I'd love to kick some ass, your kinda funny. He's an ass kicker. (laughs loudly) I've never kicked anyone on air. I think there's two ways, so each person has different ways of being... (chuckles) (laughing loudly) Checklist. (laughing loudly) I have my list, Noah's dream. Done. I'm all about fulfilling dreams today, alright. Thanks, bud. So I think there's two way of accountability. There's a positive and a negative, and it depends on the person. So, I'm... I swing both ways, I can do it either positive or negative. I've read some books recently, I think one of them is Drop Dead Healthy, where he was talking... Yeah, A.J Jacobs. Yeah. Right. So for him, he actually said that he had check for $1,000 dollars for the Nazi Party, if he ate dried mango. Sound familiar guys? Yeah. Did you guys talk about this? No, so Stikk.com with two K's at the end, allows you to an anti charity. Yeah. So that's the negative motivation, and it has to be painful. That's the real thing. Cause if it's like 10 bucks, then I'm like fine 10 bucks. Right. It doesn't really, bother me, but if it's something I would think about. There's also LiftApp. Yeah. Lift.do, which is a positive reinforcement. Yeah. That's a really great one. You can use it everyday. You just check in. Like I've been doing meditation for 45 days. I stopped now, but for 45 days I did it, and now I don't need Lift. Yeah. So, the negative is the consequence, and positive is Lift, or I'd say small winds for accountability. So, what I do every morning is, I do a GEBY. Do you know what a GEBY is? No. So, I have a health coach. Sounds profane. (laughs loudly) It's just... It's evolved over time. So I work with Adam from mybodytutor.com. Okay. And every morning like clock work emails GEBY. Gratitude, Exercise, Breakfast, You. And this I what, so I'm a positive reinforcement person. So, what that means is every morning I write three gratitude things. So one of my gratitude's was that I'm excited to be on the show. Cool. Right? My, Yeah. I am excited. Thank you for coming. I'm excited to have you here, man. And then my exercise today is weights. So I'm pre-committing to weights. We can, yeah we have a gym back here. My breakfast was an egg white omelet. It was little, but one piece of dry wheat toast. And then my "You" today was making this a great segment for everybody watching, for yourself and for... You. You. So how am I doing me today? Cool. Right. And so I found the GEBY to be, well I've been working with Adam and I found that to be a small wind each morning. Where I say, here's the one thing for me to do that I'ma do. That pushing me forward. I love it. Why is it GEBY if it's GEB-oo? GEBY; Gratitude, Exercise, Breakfast, You. Oh, yeah, I can't spell. Yeah, (laughs) yeah. The language guy. So... Just a heads up, we have about five minutes. Yeah, okay cool. With Noah. So. Total or to get to the case studies? Oh yeah, exactly. Oh, yeah we're good. We're good, we're good. Just letting you know. Can I make one real quick? Yeah, please do. So one thing that I did, that really helped me when I was building my businesses, and still 'till this day when I'm working with startups. Is I keep a swipe file. It's an old term for copy editors. So would find an ad that convinced them to buy something, and they would take it and they'd analyze it and figure out why it got them to buy. Another way to go about that. (chuckles) So I'm kind of a sucker for like good infomercials. I love them, they're like, they're so split tested. Or like 90 second spots. Like the ones that you see running all the time, are working cause those are expensive. Okay, so the ones that run for a really long time. Like Bowflex, P90X, whatever... I would buy these products, not because I cared about the products at all necessarily. I wanted to know the script they used on the phone, the upsells, the cross-sells, when it got to me, who it got shipped by, the follow up. And I would track all that stuff. So for that reason alone? This guy knows his stuff, you should definitely sign up for AppSumo. Go to appsumo.com, sign up. Just to see what they send you, how they pitch it. Anyway... Yeah, I mean just... Emulate, You do not have to reinvent the wheel. Anyway. One thing that we consider, considerate of that. Is just don't be absolute. So what works for us, may not work for you. So be willing to, open minded. Try thing out. Let me just run through a few other common want-a-pre-neur issues. Yup. So, in terms of GEBY what I wanted to re-encourage for you is small winds. I have a friend Austin who was I hanging out with in New York, and he just gets overwhelmed. Where he has this fantasy out here, but he's so hard on today. So pick one small thing today. That's it. And make it really small. Every morning I wake up and I say, what is one thing today to make today great? And it can literally be, having a latte. It can be something a trivial as like, I wanna be able to high-five four people. So get some small winds. Fear failure. This is a huge one for want-a-pre-neurs. Yeah. Where... They're very afraid. Yeah. And what they do, is they actually put their afraid-ness in a "co-founder I need," or "The designer in this country." That's a really good point. "I don't have the money." The solution. And what happens... The panacea. Yeah! And it's fascinating because once it fails, it's not them. It's that other thing. And so one thing I'd encourage anybody starting a business, or you know if you're on the chatroom. Take it on yourself, the failure and know that it's gonna happen. And the fact, Yeah. that you know it's gonna happen, reduces that anxiety or the fear of it. So what I wanna do, everyone on air, in chatroom and internet world, to fail. Right, I want to get one failure. So, here what I was thinking of this morning. I want you to email me, it's firstname.lastname@example.org. Email me and I'm not gonna respond to you. I am not gonna respond to anybody. Right, and if you... Hi Noah. @appsumo.com. Okay. If you can get me to respond to you, I'll give you a hundred dollars cash. Right? Yeah. No one's gonna do it, cause you are all gonna fail. But can anyone get through? Can anyone actually get through to want me to respond to your email? I like that. So... You're getting an auto-response with 50 absolute products. No, no, no. (laughs loudly) But I think that the thing I want you to do is, so if it's not me or there's a site called rejection therapy. What you need to do today is go get rejected. And go realize that you get rejected. I've done it. I've had a lot of failure. It's like my specialty. Okay, I have a good one. Yeah. So there are actually, I put some of them in the Four Hour Chef actually. There are phone numbers called rejection phone numbers, that you can dispense to people at like bars, you don't wanna talk to ever again. And you're like here's my number, and sounds like you've been rejected, sorry, and so you can, you should find one of those online and give it to one of your friends. Done. Even try something rejection small. That like, you have to push your comfort zone. It's when your heart beats a little bit faster. And then you get through it. It's like the gym, that last rep. And you get through it, and you're like Oh. That's where the muscle grows. Yeah. That's where you're able to persevere and have your business start. And you'll actually be like, alright. This business sucks, and I need to kill it or I need to move on to something else. Yeah. And what I found... And we're gonna jump to Seth in just a minute. But for inoculating yourself against that fear, of loss and failure. Especially for things outside of your control. I always talk about it, but I'll talk about it again. Is Letters from a Stoic by Seneca. Just like training yourself, I've given hundreds of copies of this book away. Seneca shows up a lot in the Four Hour Chef actually. But the ability to inoculate yourself against fear, by training... So for instance, like spending four or five days. Not even that much, two days a month where you eat the cheapest food. Wear the cheapest clothing. Don't use transportation, and you ask yourself. You know, all along, is this the condition I so feared? Totally. And then, your fear of failure like, this isn't so bad, I can do fine. Yeah. So let's, on that note, a condition perhaps Seth is so feared coming up here. Just kidding. You look, you look fearless. So let's jump into it. Come on up and we'll segway to looking at some companies. Thank for inviting me. Yeah, Appreciate it. Thanks for coming, you kidding? Thank you. So what are were trying to, what business are you trying to start today? Well the business that I'm starting is a biodegradable toothbrush business. How do the audience feel about that? What's your first impression or what's your first feeling? Nothing, okay so they admit. Didn't do anything. Okay. No, that's something. Okay, and so what's the problem. Is it that peel on with toothbrushes, the electric toothbrush isn't good enough? So the problem we're solving is that we want to give toothbrushes to families in the developing world. Okay, so we talked about this yesterday. Yeah. Little bit. So how much is a toothbrush? How much is a toothbrush? Like the cheapest of toothbrush. Two bucks. The cheapest? A toothbrush, like I get 'em free at the dentist. Okay then it's free. Why don't you say that it's 28 cents. Right? To... To manufacture a toothbrush, is 28 cents. Yes. And then you said yesterday, how may people did you want to give toothbrushes to? 100,000. Okay, so 28 cents times 100 thousand is? Twenty-eight thousand. Okay, so this what I think what's really interesting in that when you are trying to start your business, what's the real problem. Because your problem is not that you want people to have healthy teeth here. You actually just want to get twenty-eight thousand dollars to help people abroad. Sure. Well, but and so this is actually a key thing. What is it you actually want to accomplish, is there a problem here... I wanna accomplish creating an incredible company. That contributes to the world. Now we're getting somewhere. Right, and so with the toothbrushes, like tell me how many have you sold so far. Cause I think, and you have been working on it for about, how long? About, nine months and we've sold zero toothbrushes. And how much have you spent working on starting this business? About five thousand dollars. Five thousand dollars in almost a year? Yeah. How many people in the audience or online can relate to this? I know, I can. Yeah. I've spent way more and way more time. Way more money and time. Yeah? Really? (laughs loudly) I wasn't really checking that many hands here. So, the problem with the toothbrushes you, what sort of way, toothbrush are you tryna do? Well, so basically the problem I've been having is I've gone through whole process of being... Raising capital, and saying oh, I've gotta order this big amount of toothbrushes. I've gotta order for 40 thousand toothbrushes, and that's gonna cost me 20 grand to start up and creating this kind of dream about what I need to start the company. And so what have you been doing for nine months? What's been going on. Give me just that highlight, Well, actually. It was research design, development, and creating the best toothbrush in the world. And then I actually partnered with a dentist, and got to you know, have a deeper knowledge of the problem of oral health care. And so, yeah, that's what I've been working on. And we're still after nine months in all this. And after nine months I still have no toothbrushes. Okay, so. Yeah. Just to add one thing here. You're in the hot seat, this is a tough place to be in, so just let, Yeah, yeah. Me give you credit for... (laughs) Yeah, yeah, no, no. Yeah, this is hard, and jumped Cause this is hard. Right into it, and so like, This is hard. First of all, I guess you And I know it doesn't... gotta loosen up a little bit. Put on kid gloves. No, no, no this is a good thing though. Sure, yeah. I just wanna point out the obvious for people at home because like this is not easy. Yeah, it's not easy, So, yeah. And these guys are amazing. And I just feel like, I just wanna say, No, no, no. I'm really happy to be hear going through this process. Even though like, I'm tense right now. No, no. We've just made a lot of mistakes... And we just like jumped right into it. I'm like uh. No, no. Let's do it. I am gonna get up and kick you in the head so please move your face closer. No, no. I don't think so. No, no, we're good, we're good. Do you need a hug just to slow it down? Okay. Alright, come here. (applause) I didn't, no I thought cause we only have fifteen minutes. No, no. These guys are intense. No, no, no this is like a thirty second aside. I just wanna point it out. That's perfect. Thank you for doing that. Yeah man that was good. The key thing is like my only goal is if your successful. Right. Like if, you prove me wrong and go make a lot of money and it works, that's great. But for me, what I want to encourage you and anybody watching in the audience, is like, how do you validate so you're not wasting another nine months. Exactly. And you're not... You know insanity is doing the same thing, over and over, and over. So you know some of the things we've talked about is that you know, maybe we'll identify some of the issues that have been going on. So one of them is just like, we're doing all the other stuff, playing business. Exactly. Instead of actually seeing if people want the product. So, what can we do right now, this is something we talked about, I'd love to explore it. You want to sell biodegradable toothbrushes. Right, so who is the customer? What's the problem is a toothbrush that helps people, that's a little bit more environmental friendly, who's the person that wants to buy that? Well, I believe that a customer is someone that really cares about helping other people. And that also has kind of a, higher ethics, or just wants to make a purchase that is a sustainable purchase. And I kinda had thought, So wait, you said... My customers like, 18-30 years old. I know, but... Female, wholefoods shopper, like that's who I thought my customer was. Okay, so it's too broad. So you can go to Facebook adds and then look up how many people are in this category. The really key thing is that the smaller the audience, the better. And my favored analogy is that if you had a knee problem, would you wanna go to you know, a doctor or a knee doctor. Who would you go to? Knee doctor. Okay, someone said a doctor once. I was like, really? (laughing loudly) I was like she go to the knee doctor. Oh my god. You wanna go, to the specialist right? So if you're selling a biodegradable toothbrush, I don't see many college kids really giving a shit. Maybe a few hippies from Berkeley where I went to school. Right, but, yeah! (cheers) You know, the perfect customers is my aunt Rhonda. My aunt Rhonda lives in Berkeley Hills , she has Tom's toothpaste, like they've had organic for years now. Before it was cool to be organic. And so what I'm trying to encourage you to say, you need to be as specific as possible. Woman, two children, lives in Sans Francisco. Makes $60-90,000 dollars... My aunt a child mediator, and so the more specific is, is that actually more specifically you can communicate with them, and the more specifically you can understand them and sell to them. And seeing if they, you know, to buy your product. And the more inexpensively you can test. Once you know exactly who you're targeting. Yeah. Like hitting People magazine that's expensive. Exactly. Reaching that target through finding let's say, people who are fans of this, this and this page. Much less expensive. Exactly. So you can find them in Facebook, you can find them in different places. We can talk about that, but how could we... So let's do a time limitation. That's something that you've been struggling with. How could you validate right now if people want this around. I know you did something you know, earlier today, but what can you do right now to see if people actually want this as a business? So to basically ask people in a online audience if they believe in my product, to buy it. What does that mean? So what that means is, You know the idea in my head about the business model I want, is that for $20 dollars you sign up, and you get four toothbrushes and we mail one toothbrush. Your best friend to kind of spread the message about the company. So that's five toothbrushes for you know, America. And then we, also donate five toothbrushes to a family in the developing world. So that's the offer. Okay, so why would I wanna spend 20 bucks? Like what's special about your toothbrush? So in my toothbrush, I worked with dentists and did tons of research and really created incredible ergonomics, feel this toothbrush. Well this is not the biodegradable one, right? So this was the model that I started with, that's actually, I hand carved this out of wood. To like find the perfect shape. And then, you know with my design team. We 3D modeled and created the actual toothbrush. Sorry, to cut well I'm gonna cut you, I'm not sorry. No, that's fine, go ahead. Is the point, is that it's biodegradable, right? Okay, it's biodegradable toothbrush. You're driving, you brush your teeth, you throw it out the window. It's good. Okay, the main features of the toothbrush; it's biodegradable, and also we found these bristles which are called nano-bristles, they're really fine and they're tapered. Can I see that other one for a second? Yeah. They actually feel like you're flossing. Hold on, I know, okay. Oh, sorry. Okay, so how do we... So, Tim. I want you to, how does that one feel? So, this is maybe not germane, I think is germane. (coughs) I think you should test a few things. Okay. I love how this one feels. No, alright so where I'm going with this is, you could something like unbounce.com or whatever to do landing pages, and test different offers. Different, whatever. You could use a Facebook, Google app etcetera, to test. For click throughs. I love this thing. Maybe your product, I can't tell you because you'd have to test it. But like maybe it's a $40 dollar hand carved toothbrush. Tim do you have your wallet with you right now? No, I don't. But... Do you have your wallet in the building? I have my wallet in the building. So this is where instead of waiting to go home, waiting to make ads, waiting to make even the landing page, or wait for anything else. Like, I would buy a beautiful hand carved toothbrush. With a replaceable bristles. How much would you be willing pay? 30 or 50 bucks. Would you give him the money today? Sure. This is what... You ask. Why am I asking, I don't get the money, you ask him. I mean... No, take his customer... No, I think that's an interesting concept. Right. And I love the fact that you know, Tim. Tim is saying like boom. He wants to buy that. The reason my rebuttal to that is that, I don't want to create limited edition hand carved fancy toothbrushes for like the super elite. You know. Well, hold on, hold on. But you could still... What I would encourage you to, cause I know the guys at Tom's shoes, right? I know people who have similar models. And you don't have to make it one for one. You can make it one for 50. Right? So, I think that the point being though. I don't wanna... I do like that because that makes me 50 times better. One, I'll tell you, I mean. (laughs) No, no but. Just think like, one for one. You have a lot of competition for Mindshare. You're competing with a lot of people. One for 50. Boom. Different story, so anyway. I don't wanna jump in. No I think that's the exact point. I think the key thing to know people, everyone watching is that if you're selling something like the biodegradable toothbrush and your taking nine months to manufacture it, and it's all these other things? And, did you notice how you're talking about all that. You let Tim. (laughs) Yes, oh no. Okay. Do you... What was that? Will, let's see them in second but that's the real interesting thing. You've done all this nine months of work, you have... And this is what happened yesterday, he brought me this toothbrush, I felt it. Do you wanna give it to the audience to feel as well? It's beautiful. Yeah. Like you feel that toothbrush and you're just like, this is different. So hold it, like this... Like you're actually brushing your teeth, because then, you know, then you can kinda feel what it feels like. It's like nothing I've ever felt. And you can even put limited edition number whatever. Right? You know number one for 50, and the thing is that people want that. And that you're trying to do the hard one, but you have something that people are responding to. And so... And Seth, I'll jump in and point out that a bunch of people online before Noah or Tim even start saying about, anything about the wooden toothbrush. There were multiple people who jumped in like, Oh my gosh, I want one of those. I would pay money for that wooden toothbrush. That's amazing. Let's take advantage of this... Okay. So one, you need ask Tim for the money. Don't say Tim, how would you like to pay. That's like one of the worst questions ever. Right, so tell em like Tim. Yeah sure, sure. Tim, okay so. Would you buy this... No, no no. Would you buy? It's the, you're selling him the product. Okay. My toothbrush is $50 dollars, will you buy it? Yes. Awesome. Here. Thank you. My first customer, Tim Ferriss. (applause) Hold on, let's keep it going. Offer for 75. (laughs loudly) No actually, hold on. Keep it going. So one for 50, is there anyone online like, let's sell the toothbrush. And then you go... So the point being is not to just go sell a lot of things that you haven't made or any of that stuff. It's to prove that validation that you wanted, and being honest like... Can I do something? Yeah, please. So, do you have an email address that you're comfortable giving out? Okay, what is it? SethBrooklyn2@gmail.com. How do you spell that. S.E.T.H. Brooklyn. Brooklyn like the town, like the city? The city in New York. Brooklyn2@gmail.com. Number two? Yes. The four hour work guy has sensitive numbers. So Seth Brooklyn like the city, two, the number 2, @ gmail.com. Alright, anybody that for let's just say 50 bucks. Emails you. Hold on. Yeah. Let's, can we even go, further than that? Yeah let's go further. What's your paypal? What's you paypal? It's the same thing. So don't email him. Okay. Paypal him. $50? Sure. And then you figure out how many you could donate. For that $50 dollars after your profit. So paypaling $50 dollars, SethBrooklyn2@gmail.com And you need, basically a validation is a hypothesis. If I can sell 10 toothbrushes, I will make these toothbrushes, I will donate 'em. And then you can actually start thinking about how I scale this out. Yeah, that sounds great. You don't need to worry So paypal SethBrooklyn2@gmail.com. And we can make it like a kick starter thing, just so you don't get into trouble with like dry testing. And stuff like that. I think it's, so that was a question we asked yesterday. You can't do kick starter with stuff in your mouth, or stuff you ingest. No, no, no. What I mean by that is, let's just say say, how much money do you need to actually build a bunch of those? Or carve them, I guess, I mean whether it's labor or otherwise, like how many toothbrushes at $50 dollars would you need to sell? Point being I just don't want to get him in trouble with dry testing if he takes money and then it takes a long time to ship. If he doesn't have the legal protection with kick starter. 100. 100? so if he gets 100 orders. Right. At $50 dollars a piece, it's gonna go into production, and if he doesn't he's gonna return the money. Sure. Cool. That sounds good. Alright. Done, what are they called? I'm excited. Yeah. It's called Mola, and that's Latin for molar. Oh yeah. Nice. Beautiful. So, he got his first customer today, hopefully a few other customers online. And you got started, Awesome. And so I think that maybe we should just recap some of the takeaways here in that. Did you see how like, Tim wanted it. When did you feel that? Yeah. Like what was going... Soon as I touched it. So I just want to point out, another thing that's really common like, this is not unique to you. Yeah, totally. Like people will aggressively say no to what their customers want because they have a fixed idea of what they're going to build. Yeah, as soon as I touched it, I was just like Oh God like there's a lack of that like tactile experience. Most people use their thumbs for like the space bar and that's it. So you get something that's handmade and wooden and it's just, it's a very visceral thing. What do you think you can teach someone else who's in the chatroom that's maybe going something similar where they're trying to work on their business, they've spent months and time it's not happening. What's the difference between that and like maybe this experience that you just dealt with, Tim or the toothbrushes. Well so I definitely to mention to everybody who's online, who's an entrepreneur and a especially, a designer entrepreneur is the breakthrough that I've had talking with Noah because he's an amazing, brilliant guy, is that last night we had a short discussion and I really got held back because I just love my design so much, that I want to sell this. And so it kinda of, it was... I made it too precious and the reality is, is if I really want to just sell biodegradable toothbrushes, I can get these for wholesale at Alibaba and just sell them. So if that's the goal... It's letting go of your baby, and just moving forward with a business and making a profit. Yeah, and to do good. Like I said, it doesn't need, I think in a way it's actually better if you're not stuck in one for one model. Like make a bunch of money, you can do whatever you want with the money. Exactly. Maybe something to add is that if you want to just stick with just the biodegradable toothbrush. You know, even as a hypothesis, if you want to validate, literally do to the dentist, get free toothbrushes, doesn't cost you anything. Spray paint 'em or paint them with nail polish, go to like wholefoods where you think your customers is, stand by the toothpaste aisle and sell your biodegradable toothbrush. So you can do it in person which is actually really underrated. Super underrated. Cause people will ask questions. The other way is, if you created a mockup page. And take them through all the steps, you just necessarily collect the money. That's a lot of work. It is a lot of work. I wouldn't want to say it, like one of the things we talked about yesterday was maybe, like on your Facebook page, you have how many friends? 500. Like, do you guys have friends? (laughs loudly) Right. At least 10 or 11. Do you guys have Facebook? I mean the mockup is good and I'm not hating on it, I think that's good for like an iphone app. But with the toothbrush you could literally put out, I'm making a custom made biodegradable toothbrush friends, if you shop at wholefoods, paypal me the money, I'm trying this out. And just be as honest as possible, and say hey, if I don't sell 10 I'm gonna return the money and we're not gonna do it. And literally in a day, you have your validation versus the nine months, and five thousand. And never ask people if they would buy, it's not the same. Cause your friends, it'll be like the Mom response. They'll be like Oh, that's such a great idea. I would totally but it. And then you're like, good news I have one here, and they're like ah yeah, times are tight. (laughs loudly) Got lintels to buy. Alight, so we are gonna make, I think a transition here. Or you have a hangup? We are gonna make a transition, but we just wanna let you know, Seth. You have some additional orders coming in, you got from, (applause) Ralph just said, I've just sent 40 euros, I love the toothbrush. Greetings from Germany. First order and first international. You're a global corporation. In a night! I'm like, awesome. Cool, alright cool. So we're gonna move, yes. Yeah, we're gonna move on to round two. Thank you guys. Thank you guys. Yeah, don't forget those bad boys. I just have to say something really quick, an I say something. Please, yes. Basically, I got to look at the book, and I think it should be call The 4 Hour Life. (laughs loudly) But no, seriously I'm a visual learner and that's what's, you keep on saying it's so beautiful, it's got 1,000 images, but it's incredible for learning views into visual. So I just, wanted to say that. Thank you. Thank you, yeah. Thank to Jesse, There's more, Thanks to Jesse, coming in too Seth. The main designer behind it. She's amazing. Cool, well we're getting to the move to victim number two. Come on down. I'm gonna be friendlier this time. No, no, no. Don't be. What's up dude. This is the good cop bad cop thing. Yeah, it's working, it's working. How are you. Okay, how are you Cory? Oh god. It's like when you're gonna approach the girl and you wait 30 minutes before you do it, that's how I feel right now. Cause I knew I was coming up. He is a sexy man. (breaths out ghastly) Thank you, I'm wearing my He is a sexy man. Green shirt today, my sexy green. So what are we up to, today? What we talking about? Okay, I developed an app. Well I outsourced the development, but came up with the idea. And it's a scary prank app. So with the problem I'm solving is people want to prank their friends, and an iphone's a good way to do it. Okay. And then so why did you want do this business? To retire my mom. It's basic, was basic form. What's that about? Okay, so we grew up pretty poor. Slept on a futon with my mom This is the aweing part. 'til I was... Where you guys Awe. (crowd awing) You'll get it online too. I slept on a futon with my mom until I was 14. Like my whole family are like, you know coal miners from Nova Scotia. My Mom and Dad are like, in education of grade seven, grade eight so. And I don't have, I've never started a business before and you know, I just had that Harajuku moment where it was like, enough is enough. I gotta do something. Cause my mom's 50, no retirement plan. So, I sent out on a 24 month challenge to do that. And I spent 10 months doing what I'm good at, which is door to door sales. And I'll sell anything. I'm not afraid to do the boiler room style. What were you selling? Holes in the ground. (laughs loudly) What's a hole, I mean like? Oh. Aeration, aeration where the machine pokes holes in the grass. And coffee, I was on your webinar back in the time and I was like, do you know what cordyceps are? I saw, tea with cordyceps and coffee with reishi. And yeah, those two things. So I earned $61,000 in ten months doing that. And in the whole time, I was just researching like crazy. I read like 33 books, including all the ones you recommended. Like Venture Deals, Founder Stories, 22 Immutable of Laws of Marketing, Letters from a Stoic, and your books of course. So I started off and I've been self-documenting the process, and I reached out to my former boss who is a 10 time world kick boxing champion, that was kinda cool. Yeah, I'll pass sparring with that guy. (laughing amusingly) And he recommended two books, and one was yours. And that's what kind of what Got me into it so. So how did you pick this as the problem to solve? Or how did you say like. Like an app business in general? Yeah. Your post on Chad Mureta. App Empire, yeah. I was looking for something that I would enjoy doing waking up every morning, but also something that I find fun. Cause I'm a geek at heart. Okay, so we talked a little bit about it yesterday. How did you validate and figure out what to build? Like which app to build and what theme to build? I was looking at different categories that I could make, you know quickly and also for a low amount of money to start up. And entertainment seemed like the proper way to do it. There was so many different apps from like, small different companies and quick, like a lot of downloads too. And so I was looking, and trying to find an app that was already in existence, already in the top category, so there's proven market for it. And then find a way to innovate an app. And whether I could do it for low cost and quick. So I saw these scary prank apps in the top category, and like they were really terrible. Just really, really bad. They weren't scary. (laughs loudly) At all. I tested them on friends and they were like. Dude like, take your phone back what are you doing? This is terrible. Like pay me for that loss of life, in time. So I came up with ways to innovate the app. And make it better for the user experience. And like, I don't know. Do you want me to show you or? Well, no so. You said something yesterday like how did you figure out what to build, right? Cause you said that you read these apps, you were talking about the reviews. Yes. So I looked at customer reviews similar to how you did. And pick-pointed things that people were having like, trouble points that they didn't like about the app. And it's really crazy how unresponsive some of these app companies are to their customers. Like they're getting all their feedback via the app store, and they're saying like, "Change this," "Change this.". And they just, they just don't do it. Which is good for people like me because now I can, you know make better apps. Oh there's my website. That's a mockup. Just, anyway. So I was looking at user comments. And finding out how to do that. And that's. That's a really key thing I wanna highlight. Is that, your customers are already out there, somebody else's customers that you want are already out there telling you want the want. You just have to axctually go look, it could be on Amazon, it could be searching Facebook, searching Twitter. Looking for the word "sucks". Like when we did marketing at Mint. When looked at marketing, Mint That's smart. I looked Quicken and "sucks". And then we went and did marketing with all those blogs that were commenting about Quicken. So I think that's really key That's smart. Takeaway for everyone listening. And just to add to that, so not sure how many people out there from Y Combinator, YC. Paul Gramham defunded 400 plus startups at this point helped them, nurture and build them. One of the questions they ask when they're interviewing co-founders a lot of the time, is what are your perspective customers currently cobbling together as makeshift solutions to your problem. So people are trying to solve a problem, but doing this MacGyver, taking this MacGyver perch. What is it? And in any case. Well, you... It as pretty amazing, how long have you been working on this? And how much has it cost you so far? Three and a half weeks and it cost $3,500 when it's all said and done. Okay and then how much longer until it's actually out. Three days, just to fix a couple of bugs and then we submit it to the app store, and there's a website that tells you the average review time. Which is nine days. So if it gets approved, which I've read all the guidelines. I believe it will, and there's apps already out there like it that have been approved. I would say within two weeks, 12-14 day. Ideally, two weeks. So how do you know that people are gonna want this? Because there's already apps that are similar, that people are paying for that have made it to the top 50. And if you make it to the top 50 in the app store, that's really big considering there's over 700,000 apps in the app store now. Okay, so I wanted to just highlight a few examples of one, when you're trying to do your validation or get your business started and you're uncertain if it's gonna work for sure. So number one, look for comparables. And maybe even comparables in a second sector. So what I mean is you can go to the app store and be like, if you were like, well that one's not as scary, but you know what, it's out there and people are using it. And they can always improve it like if you guys remember the first iphone. It looked like shit. The first ipod. Remember the scroll wheel. It was thick, it was like 40 pounds. And the now you have these iphone that are, you know, clean and light. The fact is they got it out, and they can now innovate on it. So that's number one. Number two, look at Youtube. Right? So what his. Look at another vertical, another comparable industry and seeing if, that people are actually wanting it. So on youtube for like AppSumo for Halloween, we put a youtube video up, which is a really funny one. And oh what's in it? It scares you. It's similar with the maze, they're like follow the maze. That's the original. Follow the maze, (laughs) you see people like back flipping out of their chairs. Oh my god, it's terrible. The app is actually, I want to see the app, but how would you like now in retrospect, how could we validate it right now? Instead of waiting, because right now it's gonna take you $3,500, that's an extra two months. Which is two months for your mom. Right, like could have have cut that down to today. The time limitation concept. That was a tough thing for me because apps. I mean, it's. There's development time. There's not really a way with my expertise where I can just make prototype in a day. Like that just is like really bare-bones and give it to someone and say, hey like, are you scared? Or something like that, but... Maybe let me, can I show you? Yeah. So instead of worrying of building an app, doing other stuff. There's a site, well there's one that's called 520or90.com. It's actually a Seattle based company. And they basically help you tell what freeway to take. The 520 or 90. And they just drew it up. And then they just showed that as an image on their phone. They didn't build anything out. But so, Cory's app. Well, I'll just show you. Basically, well I'm gonna validate for you. I'm just gonna make it up. So Cory's app, instead of building an app, waiting for the store, paying $3,500. It scares you when you're doing something. So what you could do that'll be fun. Is, so Tim, can you add in. Actually, I don't know if I have your phone number. So. Do you think you can, actually, can you just add that in real fast? Sorry. Ah! ( yells) (laughs) Is that validation? That was scary. (laughs) Is that validation? I was like scared to do it, I was like. Well, I was expecting like something to come out of the phone, and then it came this way. I was just like, uh. Kinda like the Kelly Starrett wake up call. You with me, you good? I'm good, I'm good. Namaste everyone. (laughs) Breathe, let's all breathe. Chatroom breathe, okay we're back. So the key thing there is that, it's not. What that was fun as hell. (laughs) Today was a good day, check. Scare Tim first. So for... That's my You. Scare the shit out of Tim... "You" is accomplished. So I think the key thing is that it's okay to do two months. It's okay to spend $3,500, that's fine. But like, that was 10 seconds. Right and then we know that it's like, So Tim, do you... Does Tim wanna scare someone else? Hell yes, he wants to do it and that is someone else. But I mean, you could do that and be like, would that be, (laughs) would you like to do that if you could automate it and just hand it to someone. So Cory built an app. It's got 14 days and I've read a lot of stories where it takes longer, it's like. Months or weeks, for getting the app live. And so what I wanna highlight for the viewers and audience, and you know, and talk with you as well. How you do you guarantee that when it comes out, it's successful. You know, so that you're guaranteed to be able to help your mom. And this is what we highlighted yesterday, what can we do now or what can you do in those 14 days, to make sure that it's guaranteed. Collect people's emails. That would be interesting in purchasing it. Message them when it's out. So this a key thing we did at Mint.com, we've done at AppSumo and I think what Cory needs to be doing with his phone. So, what he told me yesterday though is that he's working on his next app already. Yeah. So instead of putting in any oxygen, he's kinda like, oh, this'll be out there. Let's hope it does well. Right, let's put our finger up to the wind. And then you know, I'm moving on to the next thing. Instead of the really putting in oxygen and time. And he has, I mean you've... He's gotten like 4,000 people on Twitter and 5, on Facebook? 6,000 on Twitter and 4,000 on Facebook. Okay. When people put our tweets or Facebook posts, it's always depressing how few people actually click or respond. Right, so how many people do you need to make it a top 10 app? It's actually, and this the key takeaways is that. One, guarantee your success. Two, you need to work backward from a specific objective. So many people are like, I want my app to be popular. What does that mean? That's exactly right. Right, so what does popular mean? So I would go look on, on you know search google top apps. What does it take, look at those top apps. See if you can figure out any articles they've shared about, what's a number for top apps? Then you work backwards, alright well I need, 50,000 downloads. That was my goal. So it's 50,000, alright so now instead of working instead how do you plan on getting 50,000 downloads? Well, my original plan was when the nine days of submission process, I was gonna start releasing marketing material. Do you want me to tell you what stuff I was gonna do? Yeah, tell. I mean, shit, there's other people online, I'd like to know. Sure. So we were gonna release an actual video similar to the game. That was on the computer. And there will be a scare in the middle of it. And then I would pass it through my channels, and hope it goes viral. Alright, so let's fix that. As one. Are you guys on the computer? Yes. Can you go to google docs? Alright, so let's just do it with right now. So instead of waiting, so let's say Cory needs 50, downloads, which is probably 100,000 emails. Yeah, that's obviously a little bigger. Assuming half of the people get the product. So, instead of you know waiting all this time, hoping it goes live, doing viral. A lot of people are now like, I wanna do viral marketing. Like they wanna, it's hard. Well you can go to google forms. Literally go to google forms and say, create a form. It's literally what's your email in a box. Right? It saying they can put it out on the creative live twitter. Yeah. So like, creative live twitter, they'll do it. But literally, go to google docs, it's completely free. You put in on a form, it says what's your email. Submit your email. Goes to google spreadsheet, free. Takes you, if it take you longer than a minute, you probably should be running a business. (laughs) Right. Then, and then you literally... And we would, I mean if we could right after this, what's your twitter handle? @millionareby number two, five. @millionareby25.com, at twitter.com/@millionareby25. So, there'll be a google form link there. And say, just give me your email. Hey everyone, we're launching soon. Put it on Facebook, put it on twitter. That took you a minute. And you're getting it started so the big key thing is with, the breakthrough here is the momentum around that. So have your objective, guarantee success and start that momentum where you're not like, putting it out and then you start building everything out. So how would you determine whether it's validated by that? So like, let's say I put it out there. And I've haven't spent any money on the app yet. The idea seems there, it's you know. And how many would it take to be validated. How many emails would I have to get? So there's two separate things. The email part, oh they have it up on the screen. The email collection part is that once you validate that people want it, which we've kind done with Tim. Talk amongst yourselves, I'll be right back. Do your thing Tim. I have to go take a phone call, no I'm kidding. I'm kidding. No, so the key thing here is that, there's two separate pieces. I don't want to get those confused. One is, is a validate so we've done it with Tim, you've seen it on youtube, you've seen on other apps out there, but they suck. So we have enough pieces where like, and you want it. That's a key thing, I hope you guys can takeaway as well in the audience. If it's something like I wanna cure cancer, like for one day in my life, if I wanna start a taco stand. Or with AppSumo, I love promoting great products on AppSumo. Right, that's what I really want and so, you know. Ideally, you want to do validation so you don't waste time and money. Yup. But once you validate it, then it's like alright, let me go build it with as minimal time and money as possible. So I think $3,500 for a month of building is reasonable. If you were gone on nine months and $5,000 plus, that's something to be concerned with. The second part of the equation now, is how do you guarantee that when you finally finish building, that you have the customers in tow. You're not like, oh I hope I have them. The app's gonna be free, I didn't add purchases. So I could get more downloads that way. Okay. I mean I think the thing for the audience and for you, I think would be interesting is collect the emails from putting on Facebook and twitter. One of things we discussed yesterday is, there's already videos that Tim mentioned. That are on youtube. You could go to those people and start building a relationship, and say, hey I'm gonna have a free app that does this too and I'll put your name in the app. So that they get some of the credit. Which is, you know, ego for them. But you're not doing it, so many times what people do is they try to like, they don't plant their garden. Yeah, exactly. They're just like, oh I want to eat now, I'm hungry. But it's like did plant anything, did you start that relationship. So start going out and exploring that, since you validated, now let me get the guaranteed success of customers. Okay. Cool, I just did a bunch of push ups. I'm feel a lot better now. Better, you back? Ah, we are going to jump into some questions. So we're gonna take questions. I just wanted to reiterate something that Noah said. Really important. (chuckles) You can't, you have to dig your wells before you're dry. Right? Just to use more metaphors. Totally. But one of the reasons, for instance that my books I think one of the several, or many reasons that I think the last two books have done well. Is that I would reach out to people, six, nine... 12 months before the book ever comes out. Wow. And focus on relationships that I would have for years, not transactions, kay. But in any case, conferences in person, the least crowded channel. Email, phone, hard. Meeting people in person, not as hard. But let's go to some questions, and... Where should we go first? Well first, well first of all, thank you Cory. Yes, thank you Cory. But also, let's repeat. What Noah said for our audience to do, just so we get that in there one more time with regard to the google form, and so that we get Cory some followers. Yeah, so, do you wanna tell people. Yeah, please. Yeah. Well, so they key thing that I wanted to highlight is that don't build your product and then go be like, oh I hope people will come to this, right? It's like having a house party and not sending out any invites. Yeah, right. And you're just like, oh, please come, it's like no one's gonna come. Like I've come home to my place, my apartment and there's never a hot girl waiting outside my door. (laughs) It never happens. So I have to go out and find hot girls, so eventually they come knock on the door. And so the point being is that with Cory. With Cory, he's got the product, he's waiting around. Instead of moving to the next thing, spend the time to build the audience. So the email thing, we've literally, they just did it right now. That's a 10 second thing. He's already done stuff on Twitter and Facebook, and he has 4,000 which, there's like how did he do it? Yesterday, he was mentioning. He just shared how he's building an app. He was just very candid. You guys all have friends on Facebook, those are the easiest if you can't get them, and they're interested in what you're doing, if you can't get them you should definitely quit. (laughs) Like if your own friends and family don't like it. So you have friends and family, you have, you know, you have putting out stuff free, you have collecting emails. Going through the people on YouTube. There's a lot of, and you know message boards are a big thing. Going on, I love Reddit. There's tons of subreddits, like scaring people, I'm sure that's a subreddit category. I'm sure there's blogs on scaring people. I'm sure there's Halloween stuff. Like there's Facebook pages about Halloween, and like maybe scary movies. And a lot of it is just building up that audience so that when you finally do launch. Like, Tim did an exceptional job with this. Like I met Tim a year before his first book came out. And he went out, he didn't hope his book did well, he guaranteed that certain blogs, and certain days are gonna cover. And I knew exactly what my target was in terms of books. Per week, for two consecutive weeks. Like, it was all very methodical, so you worked backwards. And they key thing I'm suggesting for email, is that I don't think email is best. I think it's whatever will accomplish your goal. So if your objective is, I need to in the top 10 at 50,000, being on Twitter and Facebook, not everyone's gonna click when you post an update. Right, so how do you ensure, how... Like if I can get 50,000 phone numbers, and it's that important to making sure your mom retires. Would you call 50,000 people? 100 percent. Yeah, so here, it's just gonna be what is your email. And then people are gonna add an email address, hit submit and that's it. Can I give one, I'll give one tip. I've actually wanted to share this one. Instead of what's your email, if you're putting and collect people emails, you could always ask which friend do you normally get scared by? Right, so instead of moving down the chain for like, give me one friend refer, right, which is the generic question. Go up the chain, be like, who's your creepiest friend? Right? You know, like who is the friend, and so you actually find this and Seth Godin would say "the sneezer". Right, so you can ask that question to people and say, hey you're friend Jim said I should reach out to you. And here's a free app that he wants you to know about. Now you have two people for the price of one. Referral, it's good. I like it. Oh one of the... Okay, let's go ahead and take some questions before... Can I say one other thing. Go look at, so all the ones that are already there, they've already been... The one's that are already in this category. They've been covered on other blogs, right? They were... They've been covered somewhere, probably, if you search Google for them, maybe one. It's weird. Work, work with me here. Okay. Sure, sure sure. (laughs) I'm helping out, so let's say your competition. They're already covered somewhere else. Go start connecting with those writers. Before you need them. Okay Before you wanna work, so they've already been covering it like, hey this app sucked. Here's this other one, and you start at not like when you need them but before you need them. And as you know you have more of a story. Obviously. Awesome-like stories. Cool. Cool, alright. Thank you. Yeah. Really appreciate that. Yeah, of course. Very cool man. (applause) Alright, questions. Alright, we have about eight minutes for questions. I know, Christine has one, or Christina, sorry. Christina has one here, and then we'll take some from the internet. So let's go rapid fire. Rapid fire, yeah let's do it. Okay, I'll be fast. Hi, Noah, my name's Christina. And I have a company called Home for the Honeymoon. And basically we help engaged couples register for the down payment on a house. Rather than things like toasters and blenders. So the idea is to kinda like revolutionize the traditional wedding registry, because people have everything they need, they're getting married later, and demographics have shifted. My question is, how do you decide when your business is validated, like, it's a bit of new industry. We're the first of our kind in Canada, there's maybe one other example in the States. So I, like, we've had lots of positive feedback. We've had some customers, but we haven't had that kind of breakthrough. Yeah. So, what's the, what's... The litmus test, I guess. Have you. Well it's simply, have you helped one couple get a down payment? Yeah, oh yeah. And then how, like how long did it take you to do? The sales cycle is long, because finding a house takes often times, six months. And then you have six months to kind of help them raise the down payments, so it's a year cycle. That sounds long. Yeah, I know. (laughs) It is. So it sounds like you might, sounds like you already know the answer to this. So the validation is that, if that's already taking you a year and I'm guessing you're not making that much per transaction, or? Are you guys? Well, it's about $2,000 per transaction because we make our, well basically, the realtor that we refer out to, pays us a percentage of the commission they earn. Okay, so I'm confused. So you guys help people get money for their down payments? Yeah. Why don't people just send them money directly? Because we shelter them from the uncomfortable conversation of asking for money. Basically, that's our pitch. Like you don't, you don't want to ask you friends and family for cash, but this is the one time in life where you can do it. Alright, how many people have you helped? We have about 200 registrants. But we've had about five people who've purchased houses through us. And how long have you been working on it? About a year in a half, that it's been up and running. Yeah, I would stop. You would stop already. I would stop. Why, and so I, obviously there's more to it. You have, the thing is, you are already are committed to it sometimes. Yeah. So no matter what I say, you're gonna have to go experience it. That's a big I've realized. Is that people need to fail or succeed on their own. No matter what I tell you. What I think is interesting, is that if you think the real core issue is that people don't wanna have the awkward conversation, and there's, I don't know, how many people get married in a day? In Canada? Um. A lot. Yeah. (laughs) They get married in Canada, does that happen up there? Pardon me? It happens up there, right? Yeah it does, yeah. And so I mean, Yeah, it's true. If I were you, is that you could easily. I mean you can go find 10 people getting married tody and then, or people going, that are registering. Right? Yeah. And then going and seeing if you'd help them manually. And if you're having a lot of difficulty in that, its kinda going back to what happened with Seth, is that, I have this biodegradable toothbrush, and I need to find a manufacturer, and all these things, but I kinda got this wooden thing that everyone really wants. And so there's probably some anomaly in with what you're doing with weddings. That people are like, you know I don't really have as much of a problem telling them I want money, but I might have this other problem. Which there isn't a to year cycle, or it doesn't take so much work. So, coming back to your original question is, validation is that when, I'd only say when it's simple. When it's like wow, it hasn't... It doesn't mean it's gonna be easy, or it's not gonna be some work. But it's that, it's easy for you to repeat what you're already doing. And it's sounds like that's where you're actually struggling with. And it's not about, getting the word out there. Like, just not proper marketing. No, I mean proper marketing, like marketing to me is like wholefoods. When you have a product that people want, marketing accelerates that. But you need to make sure it's something they wanna eat. Like a great taco. Right, okay. Thank you. Okay. Do you ever wanna get a meeting with Noah. Yeah. Tacos and burritos, I'm not kidding. Tacos, I swear no. Don't take him out to like a fancy restaurant. No, no. Someone sent me a Tacodeli gift card. It's my favorite tacos in the world, and that's a great way for me to remember your name. Tod Stratford. I, like Garet, I never... They send to me, and now it actually helps you know, separate the people out. Awesome. Nice, alright so we have a question from Akari Yuki online who asks, most tests needs small increments to become successful. What mindset do you need to know when to tweak and when to abandon? That's a good question. He probably knows the answer, he probably knows the answer I'd say. Depends on what he's doing. I'd say part of it is that you working on something that you actually want for yourself. It's really hard, it makes it easier to keep going with it. And keep trying to experiment what is it that's gonna make other people this as well. Like I put on a conference back in the day. And I think they key thing that I took away was, in this conference, one; how do I break even? That's it, right? So as long as I don't want the money, okay cool. And then two, how do I make this a conference that I want to go to? So as long as I'm there. And attending it and having a great time, I don't really care if anyone else came. And then, subsequently you know, I made $50,000 putting on that event. So, I think if you make something you want and you're not spending more then two months. Or maybe $5,000, like that's at point where you need to probably stop and reevaluate what you're doing. Yeah, I would also just add to that. That many people make the mistake of thinking they have to test sequentially. When you can test in parallel. So you don't have to test, one landing page, wait two weeks, then test another landing page. You can test 10 landing pages at once. And there very easy ways to do that. And really ensure that you're not playing business, cause a lot of people, what they do. Is they maybe read the article on some site that I was writing, and they're like well I put up a thing on craigslist, and I bought adds and it... Well, it's like what's your actually business? Right. What's your actual thing you're trying to accomplish. Are you trying to teach basketball. Like Rick who's going to come on today. Go, have you taught one person? Alright, have you taught the second person. But I need scale. Don't say the "S" word. But it has to be an iphone app. Why does it have to be an iphone app? Right, what are you actually solving and making sure that you validated that enough people want it and will pay for it, for you to then expand it beyond that. Okay, we just have a couple more minutes for questions, but another one is, how do you what metrics to measure when testing a business idea. So what are the top five metrics or how do you develop with it? Yeah, So that's been an evolution. One, there's none. There are none. Right, like I met the people from Wholefoods, and I asked them, I said tell me. How do you guys do your marketing in your store. Do you do psychology like are you guys like Vegas, do you have light and smells and you've put all, the, you know, things in different places. They're like, no, we just kinda make the store the way we want to shop. I was like what? (laughs) I was like you, no, no! Like don't you put things on shelves and different things? And I think metrics, they can trick you. Right, where you can look at a metric and it looks good. But, and we've done this at AppSumo. Where the metric would look great, but six months later, overall metrics are down and we're like, what happened? And so ultimately, it's really saying alright, am I making a profit, am I enjoying this? And to give, like further reading. Eric Ries has written about Vanity Metrics versus like practical metrics, I'm not sure what he calls the second set, but so misleading metrics versus helpful metric effectively, but just search Vanity Metrics. Eric Ries, R.I.E.S. Mutual friend and startup guy. So, he's written about it. That's a good place to. Cool, the key thing is like give velocity to one dollar. Make sure that people actually want to give you money for what you're creating. And then, then you can go explore other things. But I would say limit it. You know one thing I took from Zuckerberg at Facebook, is limit it to one metric. So, and hae one thing that you're really tryna accomplish. Yeah, for instance. I mean to add one more thing. At Google, many other places too. They have, like five or seven day active users unique over that period of time. And even at like YC, Y Combinator. They're kind like, you know what it doesn't matter what you measure, but pick one thing. So you're trying to improve each week. You have a weekly number. Just doesn't really even matter what is it. Just something so that you are able to focus, just not, running around with it's head cut off. I would say, yeah. That's a really good point that Tim made is that one, you have to have, like one thing we've struggled with AppSumo is we don't, you have to feel progress. So do pick one, If you're gonna pick a metric like maybe, it is just revenue. Make it something that is realistic, that suits you. Have progress that makes you feel you're going forward. And have something really tiny each day that you can indicate whether you're one it or not. Right, like okay good, this is my small win for today. As we talked about earlier. Okay, I think we've got maybe time for one more question. Richard Brownsdon from the UK. Says what's the difference between validating and running a pilot? I don't know. Okay. I don't either. And we'll take one more... Yeah, I'm not sure, you wanna, yeah I'm not sure. Yeah, we'll get one more from that, Pei Chen... Running a pilot sounds a lot cooler. Yeah it does. I want to be a pilot. Pei Chen, is saying how do you prevent someone from taking your idea? A survey or a testing reveals a lot about it. I have thoughts on that but, Oh man, I'll rip this guy. Yeah go for it. You wanna do it first? Please. I'm sure we have the same opinion on this, just go for it. Yeah, I mean. (sighs) that's a clear, that's symptom number nine of being a want-a-pre-neur. It's that you won an NDA or you're afraid someone else is going to do it. What I've actually realized, is that all business is a copy of a business. Right, someone saying Groupon invented, no. Like people have been selling online for a long time. And people have been selling in stores for a long time. And whatever you already thought of, someone smart's already thought of it. I would say the biggest thing is go do it. And one of the realizations I had, is I went to a conference, a startup conference. And I said, we're AppSumo and we promote tech products for startups. I was like, how many people have heard of us? And half the room raised their hand. I was like, half the room? This is what we do. Where's the rest of the people. It was actually a really big epiphany for me that there's a lot of people out there. And so, don't worry about the other people that are already doing it, don't worry about sharing you secrets. Just get it started, and that's the best way. Unless you do maybe biotech. Which he's not. (laughs) Probably not. Just to add to that also, to reiterate it. So number one is, as an entrepreneur, as a good chef, as a good athlete, as a good fill in bank. You need to be very confident in your ability to generate ideas and opportunity, and if you only have one idea. Don't start a business. You're gonna have to change that. And so, if you only have one sort of thing that you need to cling to, you shouldn't start the business. You need to be confident in your ability to improvise compete. Cause even if you launch your business, you protect it until you launch? As soon as it's successful, you're gonna have 10 people try to copy it. And, so that would be number one. And then, not that's number two, that is all. (laughs) Don't worry about someone else stealing your idea. If that's the case, then you probably shouldn't be starting anyways. Like it's. Oh no, what I was going to say. Also in just like the VC game, Yeah, yeah please. Where people invest? If you have no competition. Venture capitalist get really worried. It's like, they always assume like, if somebody comes in, has a great they're okay. Five other smart teams are working on this right now. Even if they don't know it. Why should we invest in this team, and you should ask yourself the same question, even you're not in the VC game.
Ratings and Reviews
Fascinating interviews. Lot's of useful tips for business and life. It's a bit of a gamble because this style of seminar does not have a clear curriculum (e.g. it's not "how to edit photographs in Photoshop"). I would say that if you have found Tim Ferris interesting and useful in the past (e.g. books, articles, talks) then you will enjoy and find this seminar useful. Try listening to the free portion and see whether it resonates with you.
Debbie Takara Shelor
I loved this class. I greatly enjoy Tim's writing and having him share and interview others on numerous topics that I'm very interested in was fascinating and fabulous.