Defining the Problem and Who Has It

Straight to you from Denver, Colorado. This is Precursa: The Startup Journey. We share the ins and outs of building a tech startup from inception to launch to revenue and beyond if you’ve ever wondered what building a startup from scratch really looks like you’re in the right place. With full transparency and honesty, we reveal it all about Precursa on our ride from idea to exit: the wins, the lessons learned and the unexpected twists and turns.

Hey everybody. Welcome back. This is Precursa: The Startup Journey. Last episode, I promised that we would talk about branding and naming. And where did that come from for Precursa, and we’re going to do that, but as we’ve been building out this platform, we realized that in order for this journey and our documentation of this journey with you on the podcast to be effective, we needed to do some deep diving into our thought process that got us to this point where we are now here in spring of 2021. And I realized the other day I was doing some digging around and found some of my original notes about Precursa, or the startup program as it was at the beginning, the startup platform. And what I realized is that this has been going a lot longer than I thought when I said 18 months. That’s because I thought it was October of 2019. In fact, it was October of 2018. So we’re coming up on three years. The platform should launch right about three years after the first kind of spark of this idea. Anyway, so I just wanted to kind of set the record straight on the timeframe because it would be easy to think – it would be easy to believe in the hype of the overnight success. Now we are just getting into our journey, you know, in Precursa. And so it’s very, very early to predict anything close to a success at that level, but we’re pretty good at doing this. We’ve done this for a while. So we have a fairly high level of confidence that there’s going to be a level of success and it’s going to be pretty high. So that said there will come a time where a lot of people who have only just heard about Precursa and they will have heard about it a few times, maybe over a week or two, and they’ll start to buy into the overnight success hype.

And that’s just not the reality. And I say that because you listening to this, or, you know, a member of Precursa may be thinking, Oh my gosh, it’s taking me two or three months to get through product market fit or to do interviews and understand my audience or, you know, whatever that is, or maybe even longer. And you might start to fret about that as if you’re behind or not doing it right. And the reality is most companies don’t hit that magical time for at least seven years and sometimes closer to 10. So when you hear about an overnight success, dig into that a little bit more and realize that it’s probably actually been a company for five or seven or maybe even 10 years, and they’ve been hoofing it and they’ve been boots on the ground and they’ve been doing all the things that they know to do. And they finally hit that kind of crest of the wave. And now they’re just riding it down. So don’t buy into that hype, but also don’t judge yourself for how your process goes. And certainly don’t skimp on the early part of the process, which is the whole purpose of Precursa. So we are going to talk about branding and naming, but we’re going to do it in a, in a future episode, maybe the next one, maybe not until the one after that. I’m not sure yet, but I wanted to go back because as I was reviewing my notes, one of the most important things that we do in the startup program with our one-on-one clients and how we’re building the platform is identifying the problem you’re solving and then helping you identify and understand who you’re solving it for. And I know we talked about this a little bit in the last episode, but I want to expand on it.

04:24

And I want, I wanted to give you the insight into how we determined what the problem is that we’re solving and how we built our user personas. Because the more examples you have, especially of real life companies and real life scenarios, the easier it will be for you to complete those exercises for your idea and walk that forward. And the more, more chance of success, the higher chances of success you’ll have. So first of all, talking about the problem, my company, uh, my consulting company, Raika Technologies, we used to call ourselves an incubator and we meant it in the traditional form of the word incubator. We were literally finding projects that we really liked who were ideated by, you know, entrepreneurs or creators that we really liked, who we thought had the, had the best shot at success. And we built their technology in exchange for equity. We did this with four or five projects that had so much promise, so much positive about them. So many aspects of these projects were like, you know, the ideas were really good and they were based in areas where someone on our team had personal experience and could say, yeah, I can see how this would solve a problem. However, almost none of them were successful or even went anywhere. And as we started to realize that our grand vision of building, you know, a hedge fund for ourselves by building these cool SaaS products or our mobile apps, or, you know, in one case an IOT device and having a piece of a bunch of different companies, it wasn’t going to work if we didn’t have verification and validation about what came first. And what I realized in working with, you know, these clients is that I have sold two companies successfully early in my career.

I have a third SaaS company that’s act been active for five or six years now runs at a very high profit margin. I’ve got Raika Technologies, which is very successful and I’m working on two new startups, one of which is Precursa, the other of which is a FinTech startup, which at some point we might have a couple of the other people come on here and talk about that. But none of those projects in not one of those projects, did I go, Oh, I have an idea. Let me go build some code, let me find a developer, let me design it and build it. And what I didn’t realize is that all the pieces that I naturally start with most people don’t realize are even part of the process. They don’t realize they should be starting by asking, what’s the problem you’re solving; who are you solving it for? How do the people you’re solving it for relate to or resonate with you, your solution, these things are not always sexy questions to ask. And they’re not always excitement generating, in terms of it’s like saying, I had this amazing idea, I’m super excited and I need to put the brakes on and go back and really dig into the why and the how and the, you know, what does this really mean? And all of the details, right? And that’s not exciting. It’s not really fun, but what it is is the time in which you, you discover, is there something real here? How real is it? What’s the shot at this being viable. And should I spend time and money? Both of which are very precious resources to the majority. If people pursuing it might be tempted, the temptation might be to think I have this idea. Oh my gosh, it’s so brilliant, there’s no way it could ever fail. This thing’s going to sell itself. If you find yourself thinking any of those thoughts, that’s exactly the time when you have to take a step back. And when you really need to dig in and say, why do I really think that, is that really the truth? Or is that my excitement getting away with me? And is it the vision piece overriding my logical brain that knows execution is just as important as strategy and vision. So those are some clues as to when you know that you haven’t dug in enough is if you’re taking a lot for granted or your, your assessment of your idea is based on a very, very small subset of opinions and insights, usually you and the people closest to you. So that’s how this process was born. And so what I want to do today is I want to talk through what is the problem that Precursa solves.

09:35

Why did we think that it was important? How did we come up with our user personas? And then in the next episode, I think what we’ll do is we’ll, we’ll dive into, how did we find people to talk to? And how did we know if they were the right people or not? So Precursa as a platform is designed to solve the question, now, what, and essentially somebody says, I have an idea for an app or a website or a SaaS or a software product or an IOT device or something, you know, something like that. I have this idea for something that could become a business. Now what? And the problem is, if you go search that on Google, you will come up with a lot of advertisements from mobile app development companies, software development companies, people trying to sell you goods and services to build a business for you, or build software for you. Which is fine, there’s nothing wrong with that. Developers are great at building what you asked them to build. They’re horrible at stopping and asking, should I be building it. Now, that’s not a character flaw. That’s not, this isn’t something they should have been taught. And you know, like, I feel like personal finance should be taught at least to high school kids, if not in middle school. But it’s not right, like this isn’t that situation. It’s that no one knows, no one’s been taught this. You learn this by going through hell, by walking through fire, the first company you ever build, and whether you are a serial entrepreneur or not typically happens because of your level of willingness to participate in that process again. So what I’m saying is there’s nothing wrong with the developers who are looking for you, having, you know, searching for, I have an idea now what. The problem is that it’s not well understood that there’s a lot of other stuff that has to happen before you put time and money into building the thing. And the very first piece is what’s the problem you’re solving. So for us, we’re solving the problem of now what. Now, obviously there’s a lot of people out there there’s a lot websites out there, there’s a lot of products and services out there that are trying to answer, now what, like startups.com that has a vast library of knowledge, videos, and blogs, and a ton of information. Entrepreneur.com also has a vast library of information. Coursera has courses about how to be an entrepreneur or how to build technology, lots of different stuff.

The problem with most of these things is they are not action oriented content. It’s knowledge. You can get as much, much knowledge as you want on the internet. The problem is what is the knowledge you actually need? And then how do you put that knowledge into action once you have it? And how do you get feedback that tells you whether you’re doing it right or not. So Precursa is designed to provide actionable content with relevant, real time, strategic and execution level feedback about your budding tech idea. It’s as simple as that. So that’s the, the problem that we’re trying to solve. So which naturally leads into who are we solving it for?

13:32

Now, one of the biggest mistakes that I see people make is they, they want the largest market possible for their product, obviously who wouldn’t. And so they convince themselves, or they truly believe that anyone is a good customer for them. Now, the reality is it may be true; in a lot of cases, it probably is. Anybody could get value out of what you’re building or what you’re doing, depending on what you’re building or what you’re doing. The problem with that thinking is if people don’t see themselves in the way you market, in the way you message in the way you talk about what you do, no one will see themselves in it. And it’s sort of this paradox and, and, you know, in later episodes, we’re going to get into how do you build a marketing strategy and how do you, you know, how do you think about social media and email and, and all these pieces that go together to create communication between you and your, your past clients, current clients, and potential future clients, right? But it all starts with user personas. And until you understand and can pinpoint two or three, one’s two little, four starts to become too much, definitely not more than four, but somewhere between two and four, very specific personas that you’re targeting. Until you do that, you’re just throwing spaghetti at the wall and, or even worse throwing, you know, spaghetti into a crowd and hoping somebody catches some of it. It’s not specific enough. And it’s one of the great myths of building any company, but certainly a tech startup, which is you don’t want to be for everyone. You want to focus on your target niches in the beginning, build up all of that customer good will, show that you can determine a problem, execute a solution to it, and actually make customers happy. And then you can expand into other areas with other personas and you will naturally have people who don’t necessarily fit into one of your original personas buying from you along the way that’s going to happen anyway. 

But the more you niche down and the better, the better you can articulate who you’re for and why you’re for them, the better your launch is going to be the, better you’re going to sell over time. And the more opportunities you’ll have to grow into other markets. So when we started developing user personas, we looked back at hundreds of client phone calls, hundreds of clients that we’ve worked with in various ways, whether it’s fractional CTO or through our startup program or VIP days or whatever it was, however we worked with them, and we looked and said, there’s really two personas that emerge very clearly. The first one we named Cody and Cody is you’re very, almost, almost caricature-ish, typical tech startup entrepreneur. He’s probably male, he’s under the age of 35, most likely single, no kids. Maybe he went to college and graduated. Maybe he didn’t, he’s got this idea, come hell or high water, this thing’s going to exist. And the reason he wants to use Precursa is because of the Precursa Score. He wants the score. He wants to be able to show in an objective way, whether to investors or people, you know, uh, angel people in his life who are going to provide seed money or angel capital, he wants some kind of objective third-party measure to prove to them I’ve done the work. And so he, Cody is going to work through the pieces of Precursa very, very quickly. And part of understanding Cody and that journey was understanding what is his emotional state at various pieces in the journey? When is he excited? And so very motivated to keep going? When does his energy level dip, when does his mood dip, when are we going to be potentially giving him information? He’s not going to want to hear, but that he has to take action on in order to get that score he’s trying to get.

And why did we make him a man only because probably 75% of the people who fell into this category were guys. So again, we’re figuring out who is the majority of the, of the niche we’re trying to target. And we’re building our persona for that. The reality is that out of our three founders, between Sarah Paige and I, Paige and I are Cody’s. We are constantly with the squirrel swirl. We constantly have new ideas. We constantly have six irons in the fire. I mean, I just told you, I’ve got one SaaS, that’s actively running, Raika that, you know, I run as my sort of day-to-day consulting and I’m building Precursa and I’m building another FinTech, right? I’m the definition of a Cody. So could it be a woman? Of course it could be. But 75% of the time from all the data that we have tells us, it’s most likely a dude.

18:21

So that’s what we’re going to target. That’s how we’re going to build that persona. The other persona that came out, that was kind of interesting, and we didn’t get it right the first time around, but we did the second. Her name is Eva, and it’s just coincidence that we have one man and one woman, sometimes people will have two men or two women. You know, if, if you have a product that’s mostly geared towards moms, obviously you might have two different profiles of working moms, right? Or one that’s working and one that is stay at home, right. Ours just happened to fall this way because of the people that we work with Eva came about, because we realized that there is a demographic of women who are naturally drawn to be startup entrepreneurs, particularly tech startup entrepreneurs. And these are women who typically are married or have some form of a support system in place. So their income is not the only income, so they can afford to take a risk. Like building a startup is a risk. They probably have one or two kids and they’re probably later in their career. So probably like mid to late thirties, maybe even their early to mid forties. And so Eva was designed as a late thirties, two kids married. Her income is a big portion of the income in their household, but it’s not so much that she can’t quit when she’s ready and pursue her idea full time. And she has the support of a husband to kind of back her so that it’s not as big of a risk. It’s not her kids won’t eat if her startup fails, right? So that’s Eva. The difference and characteristic of Eva’s that stability is really important to her. This is true of most women, even Paige and I who are more like Cody, we feel that drive for stability. It just looks different. In Eva’s case, her, her drive for stability is my kids need to eat. And I don’t want to throw away all of the hard work that I’ve done my whole life to get to where I am, where this idea came to me. You know, she views it as almost a purpose in her life, if a divine gift from the universe or from God, however you view that, that this is the thing that she’s supposed to build. So she’s going to be a lot more delicate with it. She’s going to take more time. Her emotional journey is going to have less of the dramatic ups and downs. Not going to look like a roller coaster, the way that Cody’s is. And it’s probably going to happen over a longer period of time because she’s looking for, the reason she wants Precursa is she wants validation.

She wants to de-risk and get stability around her thoughts and her ideas much as humanly possible before diving into it. So you can see they’re two very different people with two very different motivations. And the reason it’s important for us to know this and know this so clearly upfront is because how we design interviews, who we talk to about what we’re building and eventually how we design the user experience. And the platform has to work for them both. If it doesn’t address both of their needs, if it doesn’t hit their emotional States at all the right times and their moods and their, the outcomes they’re looking for, then we’ve missed and it won’t be successful. So that’s how we got to personas. What we’re going to do next episode is we’re going to dig in a little bit more to, okay, now we have these sort of think of that, think of it as a straw man. We gave them names. We gave them ages. We gave them income levels. We talked about personality traits, habits. How do they spend their money? How do they spend their time? What are their motivations? What are their fears and challenges? We, we laid all of that out. We even gave them pictures. And next we had to determine who do we talk to? And how do we know if they fit in one of these personas? And so that’s what we’re going to talk about next time. How did we find people to talk to how close to the vest did we play this as we were going, how much did we reveal and to whom and at what points. And I think that is a conversation that you’re really, really going to enjoy. So don’t miss it. Make sure you come back, subscribe to us on your favorite podcasting platform so that you don’t miss an episode. This is the journey folks. This is what it looks like. And we are thrilled to have you along with it. And we’ll see you next time.

Thank you for listening to this episode of Precursa: The Startup Journey. If you have an idea for a startup and you want to explore the proven process of turning your idea into a viable business, check us out at precursa.com. Make sure to subscribe to this podcast wherever you listen to podcasts so you never miss an episode. Until next time…