fbpx
Contact

The digital products development: why idea is not enough? Real life story

Max Babych
0 | 208 | 4 minutes
Real life storyStartup tips

    Every person has an ideal concept of life and work in mind. Some people are comfortable working as an employee. Others dream about starting their own business. Having your own business always includes risks, especially in the digital business.

    The expertise for a digital product

    A risky thing

    On the one hand, digital business sales are almost limitless. On the other hand, not everyone understands digital products, and thus those people aren’t interested in buying them. If you were to open a restaurant, you would study the analytics of the region, which type of food is more in demand in a certain area and simply open an additional point there.

    With a digital project, it is much more complicated. It is not enough to understand that there is a demand for your product because sales are limited by the power of your servers.

    Product > your job

    I started my first digital product in 2014. When I launched my first grocery startup, I already had a small consulting firm, which actually was my investor.

    I remember how scary it was. Consulting is more easy to understand. There is a BPO market and if you work in the field of B2B, you provide a service. Your revenue depends a lot on the number of your employees since you sell work hours and workdays.

    Imagination intoxicates

    For some reason, I chose the field of artificial intelligence for my digital business. In my mind, there were two themes for that: sound or video.

    I decided to start with the sound. Every night, I was designing and inventing interfaces. Thus, a dream product that everyone needs was created. Yeseveryone would need it, although no one ever told me that at the time.

    My idea was to create an application of synchronous subtitles. In 2014, there were not so many systems like that. I thought about great lectures offered by famous professors, but they were only offered in English, and I did not want to miss a single word.

    And what about the business that was being negotiated, or a trial is being held? A stenographer is needed, but it’s expensive. My application would solve this problem.

    Reality beats

    Well, actually this is the point I stopped my software development. I made a call to a friend, a specialist in mobile development and I asked him to be the co-founder. He laughed and advised me to check out how Google services work and said that this was a game for big guys.

    This immediately became my first lesson. Any idea that emerges must be validated at least minimally, but how? Take at least 3-5 key requests and check at least the first three pages of Google to make sure software has not already been developed to cover those items.

    Did you validate everything?

    Partners matter

    I checkedyes, there were competitors. But on the other hand, I knew the market was big. I continued my search for a business partner. Since I already had a company, I was a member of various chat rooms for entrepreneurs, where they shared tips and experiences.

    Three people responded to my message about an interesting project. Two of them said: “Boy, we are selling it here. MVP development it is called. Go read some books.”

    And the third one said: “That’s pretty interesting. Let’s talk.” In about a week, we met in another city and began to discuss a partnership. I was talking about my plans for a long time, three to four hours. Strange, but for some reason he was recording my speech on the phone all that time.

    The meaning of partnership

    I suggested that I would be the ideological inspirer and would find a specialist in AI development, and he would find mobile developers. We also agreed that we both would be looking for an investor in the meantime.

    Now here came my second lessonany agreement in words and without formally spelling out at least minimal obligations is not considered an agreement at all.

    I left happy. I would be managing sales 100 percent. And I had his word of honor that mobile developers and even an investor would be found.

    Back at home that night, I sent him all my business plans and ideas.

    But I didn’t get any answer from that side. Nobody answered me anymore; there were neither developers nor the investor.

    Be prepared

    Only two weeks later, I decided to check who was the person that I had spoken to. I found him on LinkedIn, and it turned out that he was just a junior-level business developer. Of course, he was not acquainted with investors or a development team, since his experience at that time had only been eight months.

    The third lesson is to conduct an analysis of your opponent before the negotiations. This will help you at least not to get into such a situation, but at most, ask more correct questions if the person is targeted for your business.Check list of your partners background

    How it needs to be

    Gather the team

    I began to search for a team for the project myself. I walked through the local universities, where everyone refused me. I started with the management of universities. Everyone asked for project funding confirmation. Then, I decided to go directly to scientists.

    For the first time, I found a person who said he was interested and ready to help. Now I was more prepared this time. I had a contract written on my knee and an agreement on commercial secrets. We started making a test product. In about three weeks, I received a model that could recognize something and the developer’s response. To create something adequate, he needed one year and a team of three people.

    Use plans, then fail

    Another lesson came into play here: Explore competitors. Learn how long they are developing solutions and what capital is behind it. How many rounds of investment do they have? Who is their top management?

    I realized that I would not have enough money, so no analytics and analysis could be done. Nobody answered my mailings about my investor search. I decided not to develop this idea any further. And it was likely the best decision in this story. The final lesson of this project: Be able to accept failure.

    Posted by

    April 4, 2019
    Max Babych
    Max Babych
    CEO, Founder

    I am serial entrepreneur and IT professional. Launched 4 own products and more than 20 products for customers in SaaS and Marketplace industry

      No comments

    Leave a Reply

    Your email address will not be published. Required fields are marked *

    Subscribe to our blog

    Recommended posts

    What is SaaS product – A Welcome Guide to Cloud Software

    What is SaaS product – A Welcome Guide to Cloud Software

    Software-as-a-Service or SaaS product is a very common business model for the world of digital products. As Bessemer precisely notes, nowaday there…

    read more
    The Ultimate Guide on How to Plan and Launch an MVP

    The Ultimate Guide on How to Plan and Launch an MVP

    The launch of an MVP is the key stage of building your startup. It serves as the main tool to test your…

    read more
    9 Steps to Find the Unicorn Startup Idea

    9 Steps to Find the Unicorn Startup Idea

    Nearly every tech giant that now inspires founders from around the world once started as a unicorn startup. Such companies are now…

    read more
    CLATE MASK | Keap, SaaS trends, $100 million revenue and artificial intelligence

    CLATE MASK | Keap, SaaS trends, $100 million revenue and artificial intelligence

    Clate Mask Linkedin CEO and Co-Founder of Keap, formerly Infusionsoft – You received a Bachelor of Arts in Economics. What changed in…

    read more
    UI vs UХ: What is UI? What is UX? And What’s the Difference?

    UI vs UХ: What is UI? What is UX? And What’s the Difference?

    A word “design” has a very broad meaning and is used in nearly every business or industry. We always have an intuitive…

    read more
    Rich Santo: how to generate 12,2 million revenue

    Rich Santo: how to generate 12,2 million revenue

    Rich Santo Linkedin CEO at Culture Studio – Rich, did you have the aim of starting this business when you were a…

    read more
    How much does it cost to build an MVP? 4 options to fit your budget

    How much does it cost to build an MVP? 4 options to fit your budget

    The main thing about creating an MVP is that just having a groundbreaking idea is not enough. The key to success is…

    read more
    Apps like Uber – How Much Would Cost MVP Development and Marketing?

    Apps like Uber – How Much Would Cost MVP Development and Marketing?

    UberCab, now known as Uber, was launched in 2010. In February 2011 it had a $60 million valuation. Today, its valuation is…

    read more
    What is an Idea Validation and Why Is It a Must-Do Step for Any Startup Founder?

    What is an Idea Validation and Why Is It a Must-Do Step for Any Startup Founder?

    Are you a first-time startup founder ready to turn the world upside down? I’m not going to lie to you ⁠— it…

    read more