Lately I decided to give the Get Rich Fast resources a chance and believe it or not, some of it can really help you squeeze a dollar out of a product or service. What most of these resources fail to discuss is the foundation. A better version of these articles, books and videos could be, Build Your Wealth Quickly on Strong Foundations. The foundation is what differentiates the tactician from the strategist. Different effective tactics can be used to generate revenue sometimes in a matter of hours but is it always scalable? What’s a foundation and how can it be built? Questions to be addressed and answered in today’s article.
A foundation is the core. The core of a service company is different from that of a product oriented one. The core is about a company’s product, process, people and culture.
In a service company, it is people who usually constitute its product. In a company that sells tangible products, it is the machinery, suppliers and distributors who represent the product. Everything comes down to people with higher and lower degrees depending on the business type.
Individuals with complementary skills, shared passion, understanding and vision constitute a team. A team can be as small as 2. A strong company foundation recognizes the capacity of a team in its planning and execution.
A process without an end cannot be called a process. In a service oriented company such as financial planning and investment, the business/client relationship may be continuous. A strong foundation occurs when large complex processes are divided into smaller, simpler and recognizable versions that have a beginning and an end.
A set of told and untold rules by which the company stands and grows in a natural and spontaneous way. People who do not fit within the culture represent a threat to the foundation. People who believe in it represent an asset on which multiple floors can be built.
Research shows that most startups fail due to premature growth. Therefore, without a foundation, you can certainly squeeze an extra dollar out of your product or service using several tactics but rarely will you see constant success. Out of all the stages of venture initiation, company foundation is when things can go down surprisingly fast. Failure or lack of interest or need during the hypotheses validation and/or iteration stages is usually expected and can be accounted for. Serving 100 clients when you can only maintain high quality with 10 or accepting an order that exceeds your capacity by a huge multiple will make you compromise. Instead of compromising, take your time perfecting the product, aligning interest of people, defining the process and enforcing the culture.
Story worth sharing:
A friend of mine, Oscar, observed a need, proposed a solution, validated it qualitatively then proceeded with the development of the initial low fidelity version for quantitative validation. His main focus is marketing, business development and sales. He recruited two developers one of his good friends recommended. He delayed launch of the web application and used a number of online tactics to attract and excite users. His initial prelaunch list reached almost 5000 users. Upon launch, he realized that the back end developer failed to release access to the platform causing a 60% drop out rate. Developers’ interest where not aligned with that of Oscar. As a side note, the 60% drop out rate also explains that most of the users he attracted did not have an urgent need for the application.
What Oscar could have done:
Oscar could have taken more time to find the best people for the job. An extra month or two of careful recruiting do not represent a cost especially at the beginning of a venture. Oscar could have focused on attracting early adopters who need his solution the most. Just like he used tactics to attract users, he could have used tactics to filter them. Finally, Oscar could have taken even more time to find a co-founder. After months of co-founder searching, I recommended that he validates the need for his solution, build value then approach potential co-founders he had contacted earlier. This is one common way to find the best talent if you do not have existing friends with complementary skills.
This is Abdo Riani. One of the founders at AspireIT. We help business owners and experienced professionals leverage experience to build viable and valuable solutions.
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