I was having a chat with a friend who runs a successful cultural meetup group; essentially he connects culture providers with people interested in Japanese culture. He’s currently trying to transition this group into his full-time work. I took the opportunity to ask him about his business:
Me: What’s stopping you from making a living on this?
S: I don’t make enough money per event that I set up.
Me: So what’s the next step?
S: I’m working with a few developers to make a website to sign up more culture providers and tour operators. Then I can run more events and live off of a small cut per event.
To give you a little background, he runs 2-3 events per week, has 10+ tour operators and a score of culture providers. Do you see the problem here? Instead of concentrating on creating a business, he’s working on creating a website.
Websites are fun, sales are hard
This isn’t rare – 90% of first time entrepreneurs make this mistake. Why?
- it’s fun to build a website, it’s a drag to make sales (procrastination)
- web startups have an allure, and people want to be a part of one (vanity)
- they think if they build a website, they can make money faster (greed)
It’s a classic case of confusing what is fun/easy with what is important, and it’s a huge waste of time.
Your website is not your business
Someone smart once told me that a business is just organizing chaos. If you can do that, people will be willing to pay you for your effort. They don’t care HOW you do it – in fact, they probably don’t even want to know. The only thing they care about is WHAT you can do for them.
In the case of S above, his WHAT was making it easier for culture providers and culture consumers to connect (and he was doing an amazing job of that). His real problem wasn’t that he wasn’t running enough events, but that he didn’t fully understand his business processes (in particular his sales cycle including pricing structure). He was concentrating on the HOW when he should have been concentrating on the WHAT.
Do NOT confuse your website for your business. Your business is what you do, not how you do it.
So when should I build a website?
A website is a tool – you can use tools to optimize your business processes. If your business processes are flawed, then your website will be flawed. You should NEVER invest time/money into a website before you can answer the following questions:
- which business process will this optimize?
- i.e. sales, marketing, fulfillment, management, etc
- what are the metrics I hope to optimize (and by how much)?
- i.e. reduce cost of customer acquisition by 30%
- how long will it take to recoup the cost of creating the website?
- websites are expensive – make sure you aren’t wasting money
- are there better ways I can optimize this process?
No, seriously, I REALLY need a website
Okay, maybe a website is critical to one of your business processes. But are you sure you need a developer?
Most people underestimate the cost associated with building a custom website – a custom website can cost you tens of thousands of dollars. If you lower the scope of your idea, you can release a smaller (but still useful) piece of your vision using existing technology. This reduces your risk while you ensure that your website actually does what you think it will. For instance:
For a website that aggregates information from other websites – why not try manually aggregating the information onto a blog like WordPress? This allows you to see if there is a market before you hire a developer to create a scraping tool. A lot of people don’t know that I used to manually update the deals on OneSpout.com every morning at 5am before we created a scraper to get the information automatically.
Note that you don’t have to do this yourself – you can hire someone on oDesk or eLance to do it for you.
For a subscription box company – a trendy type of business, but the technology doesn’t need to be crazy. Put up a WordPress instance with a landing page (I use Divi, but you can use any theme you like), get a plugin that collects all required information and manually copy it to a spreadsheet for fulfillment.
For websites that require custom maps – lots of providers out there, including Mapbox, which I personally use. Create your map and then embed it on the website platform of your choice.
For a website for a local business – just use a Facebook page.
…the list goes on. There are just so many technology platforms out there right now, you can probably create a barebones version of your idea for much less money than hiring a developer to do custom work.
As a developer – think twice before you hire a developer
When I used to do freelance development work, I often counselled clients NOT to hire me because their ideas weren’t validated. If they decided against my advice, I went ahead and built the site that they wanted; after all, the customer is always right, and I got paid whether or not they were successful.
As an entrepreneur, I think totally differently. I aggressively work to reduce my risk, and only spend money when it’s absolutely necessary. When you need one, a good developer can be an amazing investment. When you don’t need one, they are a huge waste of time and money. Be absolutely sure you need a developer before you get one.
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