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1071 points mtlynch | 5 comments | | HN request time: 0.642s | source
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tgtweak ◴[] No.39399561[source]
I think people (and the founder) are focusing on yearly profits as their remuneration and comparing it to a salary... but the reality is you're creating a company that should be valued (and eventually sell) for 7-15X Earnings - and you really should be looking at that increase in value vs your increase in profits. In reality your net worth went up by over $1.5 million in the last year, in addition to earning 236k - that is the actual value you created for yourself in the last year and not the 236k you cashflowed.

I find it redeeming that despite having a gift for development - software and hardware - the biggest factors affecting profitability and growth here are things that most MBAs would do in a business quite regularly (outsourcing design/packaging/fulfillment, streamlining costs, doing price elasticity experiments, polling customers and markets for product improvement).

I enjoyed seeing the inverted perspective that product/engineering is straightforward and low risk but things like optimizing fulfillment and operating costs is a new exciting endeavor.

One tip I suggest doing is leveraging google ads to figure out features that customers are willing to pay for before you build them... if they're clicking the ad they are searching for it and interested in buying it. Start a few very low cap campaigns calling out features you are thinking of building into the product, and see which one get's the most impressions and clicks per marketing dollar and focus on that. The added advantage is you know it will be easier to buy advertising for it once the feature is done.

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1. OJFord ◴[] No.39399807[source]
Advertise features you don't have and disappoint/infuriate those would-be users? Or are you suggesting a slightly less annoying 'coming soon' type landing page, where if it doesn't get enough traffic 'soon' just never comes?
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2. boarnoah ◴[] No.39399932[source]
Wonder about this myself, have noticed with folks like Rob Walling and presumably others. They all seem to suggest testing market fit by essentially doing this for features, and in some cases soft launching websites prior to having anything ready at all!

Seems risky if you are dipping your toes into something you do not have a deep understanding of the product market for.

Anecdotally I've seen with video games (the communities tends to be very vocal and somewhat centralized?), where inexperienced developers promise things that are realistically way beyond the capabilities, or promise things too early based on their honeymoon period for rough implementations. Then suffer on the other end when they fail to meet roadmaps or delivery of features at all.

It seems like an even worse situation with serious software with asks for larger amounts of money? Then again maybe this strategy can get away with it, because there is that lack of cohesive communities with some degree of group think who would get up in arms over bad promises?

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3. tgtweak ◴[] No.39400004[source]
on $10/day max spend you'll get 1-2 people that will visit the page, and you can put a "coming soon, leave an email and we'll let you know" then you can email them when it is deployed as well to recoup the adspend. If they're looking for a feature you don't have they're not really your customer today anyway. If they're looking for a feature that doesn't exist anywhere then they have no choice but to wait for it to be built.
4. vundercind ◴[] No.39400218[source]
Yeah, it’s simply lying.

“Hussle” ethics of “if it works it’s OK” are so damn gross.

5. hurflmurfl ◴[] No.39404000[source]
The reason it won't really work for gamedev or complex software is that the risk of the business isn't really in the product-market fit, but rather in stellar execution.

If your business idea is dependent on being able to do a complicated thing, then a POC or a demo might make more sense for testing the waters and seeing if there's any technical impediment to the idea