I’m Too Sexy for My Startup… Because I Have Traction!
“I thought building a startup was supposed to be… sexy… ?” Yeah, we hear it all the time, and maybe you do too, but in today’s episode we’re digging more into why the reality of a startup rarely lives up to the hype. We also talk about what traction really is and how to know if you have it.
Join us for this episode of Precursa: The Startup Journey, a podcast hosted by Cynthia Del’Aria as she dives into the ins and outs of building a tech startup company from scratch. With full transparency and honesty, Cynthia brings us on the journey from idea to exit, and everything in between, as the co-founder and CEO of Precursa.
- Today, Cynthia shares the illusion that social media has brought about what life is “supposed to look like”. Learn to recognize the vital role of vetting and validating a startup. Do you know what it looks like to be a startup founder? It doesn’t look attractive till the end; before that it is constant work. Start to understand what the journey really looks like and what crucial role someone’s “why” plays—the “why” matters most because it is what will get you out of bed and keep you going on the toughest of days.
- Cynthia starts off this episode with discussing what it looks like to prioritize life with a startup. What comes first when you’re getting a company off the ground? Prioritizing both time and money are critical to determining the trajectory of your startup. Cynthia shares about the importance of her own support system and the advantages that help de-risk her endeavor. Learn about the disadvantages that get created for various groups, such as women and people of color.
- Cynthia chats about her desire to help flip statistics on their heads. Less money ought to be going into projects that we know will fail, so that more money can be available for the most potentially viable ones. Cynthia wants to gain enough wealth to create a fund to help people in a different way. Investors and company owners both want to win; since the journey is not sexy, the “why” must be bigger than you think to keep you going.
- The episode shifts to talk about banks and investors, and their desire for traction. What is traction and how do you get it? Cynthia talks about traction as related to revenue. List-building is another form of traction that can prove the value of your messaging. Do you have revenue? Do you have a product on the market to be purchased? Precursa’s goal is to prevent scenarios where people get too far into the startup process before knowing whether they will have traction. Learn about pre-selling, A/B testing ads, and how to drive traffic in click-through rates. Cynthia describes traction as tethering a light bulb idea to the earth, so that when you push on the gas, it will take off.
- Drawing the episode to a close, Cynthia addresses strategic partnerships both before and after launching. Some partners will join with a good idea, and others want a level of traction before jumping in. Connecting with brand value and brand trust can play an important role for start-ups and their ultimate success with traction. Consider how different journeys look, listen to other people’s stories and perspectives, but never forsake holding on to the truth. Keep working to innovate, create, and invent!
Be sure to like, share, and subscribe to Precursa: The Startup Journey on your favorite podcasting platform and tune in for the next episode! Email us at firstname.lastname@example.org with any questions or comments. Check out our website (https://www.precursa.com) for more information on getting your startup rolling.
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.
Hello everybody. Welcome back. This is Precursa: The Startup Journey where you’re coming along for the ride while we build our startup. I am your host and co-founder of Precursa, CEO of Precursa, Cynthia Del’Aria. And I got this question. Somebody said, I, you know, I was sort of explaining, you know, the process of vetting and validating a startup to prevent spending time and money on something that that’s never going to turn into anything. Right. And as I was explaining it, you know, the person I was talking to you, I was like, well, that is a really cool thing. Like that is what everybody needs. And he’s like, but it’s not really very sexy. Is it? And what I realized in that moment, and this came from someone who is an attorney, you know, a business attorney, right? So like this isn’t even someone who worries about that kind of thing for himself. But he was like, you know, I’m betting that people’s responses. Well, that’s not very sexy. Aren’t startup founders supposed to have like super sexy lives. Right? The answer to that question is no, like, you know, the whole social media thing has created this illusion of what life is supposed to look like. And somehow this gets extended into like every area, like work supposed to be more exciting. And I’m supposed to have more passion and energy for my work. Right. Because that’s what it looks like on social media. And you know, my vacations are supposed to be like magazine worthy because that’s what it looks like on. So like, I am so over this, do you know what it’s like being a startup founder, it’s working all the hours. You possibly can like nights, weekends, vacations. Sometimes aren’t even really vacations they’re opportunities for you to be heads down on your startup for a few days in a row. You know, I struggle with this because it looks sexy again at the end, right? It’s that last 1%, 2%, 3% where there’s a exit happening. And everybody’s like, Ooh, they’re worth a billion dollars. Or they sold their company for $5 billion or $500 million or whatever it is. Right. And that’s the standard against which you’re comparing the whole rest of the journey, the other 97 to 99%. Right? It’s just not realistic. You know the reality I’m going to start starting next month, one session a month, one podcast a month. I’m going to bring in somebody else who can start talking to us about this, right? So I’m going to look for entrepreneurs who I’ve worked with, who can talk to you about the journey. I’m going to look for entrepreneurs who have exited successfully. That can talk about the journey, because I want you to start to understand. You don’t have to believe me, but this is really what the journey looks like. And this is why. And I know we talk about this a lot, but it bears repeating. This is why the why matters because the why is the thing that’s going to get you out of bed. It’s the thing that’s going to make you work that extra hour at 11 o’clock at night, when you need to write the why has to be big enough. And I promise you, I’ve never met someone where the money alone was enough of a why. It just isn’t because the money takes a long time to come. You’re going to be raising. And it seems like a lot of money, right? Like we’re going to raise half a million dollars. We’ve put 150 grand in. We’ll probably get another 250 grand out of the grant from the state. Once we’ve raised that money, like seems like, wow, you raised 750 grand. You guys are probably doing pretty well. We’re not making anything right. We’re putting all of that money into every piece that we need to create a successful MVP and give ourselves some runway so that we can get to cashflow positive in this company as quickly as possible. We can’t do that. If we pay ourselves 300 grand a year salaries, right? We can’t do that. If we pay ourselves a hundred grand a year salaries. So the money isn’t a big enough. Why? Because it’s not going to come fast. The why is every person I meet who doesn’t have Doug’s story? And if you haven’t heard Doug’s story, I think, I think I told it like two episodes ago, but you know, Doug’s the guy who spent hundreds of thousands of dollars close to $500,000, four and a half years of his life lost his wife, lost his house. And at 62 was going back into corporate, trying to find someone to hire him back into corporate. So he could dig out of this hole that he created for himself. Right? That’s my, why is that? Doug never needs to go through that. If Doug had worked with me in the beginning of his journey, I would have told him not to be borrowing his house in his retirement. I would have told him, let’s find a way to either cash flow. This build a different MVP, or we may have done research. He’s never gotten traction. That’s part of why this is such a problem for him. We would have done the research and we would have been able to say, Hey, there’s nothing here. We either need to find a different direction to go. That does resonate with people or get this out of your head and go enjoy your retirement, man.
So my, why is that? My why is preventing Doug’s story from happening and every single person for whom I can prevent that story. That’s what gets me out of bed. That’s what has me work the extra hour. That’s the thing that has me set aside when I can’t be with friends and family and go to dinners and all, all the things that are socially expected of me, I can set those things aside because of Doug, because his life in that moment is more important to me than my social life. Preventing that story for him is more important than anything else that can come up in my life. So I say all that, because it’s not sexy. If you listen to the podcast long enough, you’re going to realize that like there’s frustration, there are wins. For sure. I mean, every day I find at least three reasons why I’m like, yep, I’m totally on the right path. This is a total win, regardless of what happens, you know, with the money piece and all that, right? Like there are reasons and moments every day that remind me why I do this and that make it worth it, but it’s not the money. Right? I mean, because there isn’t any right now and it’s probably going to be that way for a while. I mean, if you look at our proforma, we don’t even give me a real, like, I think my first salary is like $80,000 a year in like year three. Right? So we’ve got another two and a half years ago. I don’t care. That’s not why I’m doing this. That’s not my goal. That’s not my purpose. Now, one thing that that does do is you might think to yourself, well, I have a family to support or, you know, I got bills to pay. I can’t just go without a salary for three years or longer. Right? Here’s the deal. You’re going to have to find creative ways to make money. If you don’t have other sources of income, or if you don’t have the ability to, you know, live off your savings or whatever for a while, maybe that means you work on your startup full-time during the day. And then you work nights and weekends, a coffee place or serving food or at a movie theater. I mean, whatever it’s going to take, you know, you can do the flip side, which is you do your nine to five job and then nights and weekends, you’re working on your startup. I can tell you, your startup will take longer that way. Okay. And that’s not a problem. Last episode or the episode before we talked about how it’s going to take more time than you think anyway, doing it nights and weekends will take longer because you will find reasons and excuses to procrastinate more. You’ll come home. You’ll be tired. The kids will, you know, you won’t get them in bed until eight 30. And they’ll be like, well, I have four hours of work to do. Am I working till one in the morning? Yeah, probably. So that’s why I’m saying, is it sexy? No, it’s everything you have. And then some, that’s why this is lonely, right? Like you’re going to get a lot of social pressure from people in your family, from your friends, from people around you about why are you doing all this work and making no money? How come we never see you? Why do you always say no to things? Well, there’s two reasons I say no to things. One is, if there’s something about my startup that comes up, I’m going to prioritize that over. Just about everything. Barring my family, like my, you know, my fiancé or our children needing me for something. My startup’s going to come first. Like I’m going to put it first. And because that’s what it takes to get a company off the ground and to make something like this happen, that may not be the way that you prioritize your life. That’s okay. It’s going to take you longer. So what I’m trying to get you to see is the sexy personification of building a startup has to do with wanting it to look a certain way, rather than wanting it to be the way that it needs to be.
And I want it to be what it needs to be. I don’t care what it looks like. I want to create the thing that I know I need to create in order to help more people have a successful startup journey. And I want them to live in reality about what that startup journey is really going to look like. And it’s hard and it takes a lot of your time. And it’s lonely because there’s a lot of social pressure to make different choices, whether that’s because other people want their choices to be validated or more likely in my experience, they just don’t understand. They don’t understand why you’re prioritizing this thing over, hanging out with your friends or going to a movie or working a job where you could make an extra $50,000 a year. Right. They don’t understand, you know, for me, not only am I working all the time, my budget looks like the budget of a much lower income person than I am, because it’s more important for me to have a bigger emergency fund to cover myself because I know how long it’s going to be than it is for me to spend a bunch of money on clothes and bags and shoes. And you know, all the things that other people prioritize, right? So it’s not just even prioritizing my time. I prioritize the way I spend my money differently. And that’s, what’s required that in. If you talk to now, there are some stories and I’m going to try and find some of these too. I don’t have a lot of them in my immediate circle, cause I’m not in Silicon valley, but there are some stories of guys who come out of some big, fancy MBA program. They’ve been in Silicon valley, their whole lives. They’ve done their whole careers. They’re, you know, they’ve been interns there and whatever, and somebody gives them a bunch of money and they’re okay with them paying themselves 150 or 200 grand a year to go try some stuff and potentially turn their money into more money. That’s rare. Most of the time your investors want to know that their money is going into your company, not into your pocket. Right? And like, if you look at like, let’s look at the Elizabeth Holmes story, Theranos right. Like that’s probably the big one where there was a big promise. There was huge capital put into that project. I mean, if I recall correctly, she got billions of dollars of funding and backing, right. Which is she was able to actually, if the science worked, those people would have made so much money on their money. The problem is the science didn’t work. And she knew it really early. And she put a lot of money in her own pocket. And in the pockets of her executive team while taking other people’s money, making them promises, knowing she couldn’t deliver on it. That is the exact opposite of what your investors looking for. So if you are profiting and they are not, that’s not going to make an investor happy. They want to know that you’re putting your money into making your company as profitable, as successful, as sellable, as exitable as you possibly can. And we’ll all profit together. Now this creates some disadvantages. Okay. First of all, it disadvantages anyone who doesn’t have resources or support or backup who doesn’t have money, right? Like, so David is a huge support system for me. Now. He supports me financially only in the way that I live in his house. And our agreement was, you know, when we moved in together, I said, look, if you want to move into my house, I’ll pay the mortgage. You don’t need to do that. That’s not your responsibility. It’s my house. This is the way that I choose. You know, this is level of lifestyle that I choose. So I will pay for that. And he said, no, no, no. I want this level of lifestyle. And so I will offer the same thing, which is, I will pay for it. You don’t have to, you know, come up with a way to pay for half of a lifestyle that you don’t necessarily need or want. I will do that. Right. So he pays the mortgage. When we go out to dinners and social events and travel and stuff like that, sometimes I’ll contribute if I can, if I have it in the budget. But otherwise he knows that if he wants me to go with him, which he does, he’ll pay for that stuff. Right. So there’s a level of lifestyle that he does pay for. Okay. But outside of that, I pay my own bills. I paid off my own debt. I’m funding my own emergency fund. I fund my own retirement stuff. Right. And we help each other and it’s more the, we help each other. But also knowing that if I got in real trouble, he would help me. He’d help me figure out a way to, to, you know, sort it all out. That’s not necessarily financial help, although he would do that if he could, but it’s more the support system and knowing that you have options, right?
Another thing that I have, I am very advanced in my career. And every time I do a fractional CTO or a fractional COO gig for a company, I ended up getting a very big job offer. Usually about five or six months in. It would be very easy for me. If this all goes to hell in a hand basket, it would be very easy for me to go get a $250,000 a year job like within a couple of weeks. Right. So what I’m pointing out is that I have a lot of advantages that have de-risked this whole endeavor for me in ways that a lot of people may not have. So that means that I have an advantage over those people in that I probably have more ability to be successful, probably not probably I definitely have more ability to be successful than someone who’s barely making ends meet. Right? So there are disadvantages that get created with the nature of building a company like this, that disproportionately affects women over men, because men generally can take more risk men generally through the course of their careers, make more money. I don’t believe that I don’t have the same reasoning for that, that I think a lot of, you know, staunch feminists do. I think that we, as women are not good at valuing ourselves and demanding our value because we are always at war with, are we really worth that? We know we’re worth it, but are we really worth it? You know, it’s this sort of internal struggle. And although men have it, they generally don’t mind risking not getting the job because they’d rather that and go find somebody who really values them, uh, the way that they see themselves then to take something and be unhappy. And there really is a gender line there. I think I’ve just seen it a lot. I’ve done a lot of coaching with women in tech and I just see it much more than I do with any of my male founder clients. So there is an inherent disadvantage to women because we generally don’t have as much wealth and we don’t have as much access to wealth as a lot of men do that could also be said for of color, right? Black women right now are creating more businesses than any other group of people in the United States. And yet they have the least access to financing, funding, generational wealth, you know, the ability to support themselves in order to go after that thing. Right? And so there are disadvantages that get created. Here’s the thing, our job. And part of the reason why I want Precursa is to give big. Another piece of my, why is not only do I want to flip those statistics on their head where it’s not nine out of 10 VC backed startups that fail it’s one out of 10 that fails. The reason why that statistic matters to me is because if less money was going into projects that we could know were going to fail beforehand, where we, you know, knew that nobody wanted what they were building, or we knew that we were too early in the market or whatever it was, right. If less money was being given to those projects, more money would become available for more projects that have the ability to do a two to three X return in three to five years. And if you had nine companies doing a two or three X return in five years, you wouldn’t need all the companies to be able to promise you a 10 X return in five years, because nobody would to be having to make-up for everybody else. And then more projects by women, by people of color, by other disadvantaged groups, because of what it really takes to build a startup, could get funding and build their thing. So that’s another piece of my, why is that if, if I have enough wealth that I can create a fund to start helping people in a different way, not charity, none of these women or people of color, none of these disadvantaged groups are asking for charity. I just don’t believe that I’m not hearing that on a daily basis. What I’m hearing is I just need a little help so that I can get over some of these humps and the help I need is money, but it’s also, I need support and I need a system and I need a community and I need some people who can mentor me and show me the things that I don’t know. And the things I don’t know, I don’t know to help me be more successful. So I’m saying this because that’s another really important piece of my why.
For me, I want big wealth so that I can help solve this problem that I have not only experienced at times. And certainly, you know, with raising for my startup, we’re, we’re experienced in a little bit of it, but I have enough people who know me and know my background and know my history and know my successes, that that’s not going to be a problem for very long for us. But there are a lot of people, a lot of women, a lot of people of color who are struggling to raise capital simply because of their disadvantages, which is we see it all the time where, you know, a female founder will be pitching. And she said, you know, when they say, well, what’s the salaries. And she’s like, well, you know, in order to do this, I got to quit my job. And so really the 7,000 a month is kind of the minimum I can do and support my family and pay my mortgage and everything. And you can see investors judging her for that right now. I don’t think it should be that way. I think we should be able to pay ourselves a livable wage. I don’t know that that’s always possible. And I know that in the current investing conditions, it’s not now I want to change that, but that’s going to take something to change and that’s going to be a longer term thing. So in the meantime, the best, the fastest path I know is let me help more people de-risk as much as possible so that they know they’re putting their money in their time and their energy that they do have into the right thing. And let me build wealth enough, big enough that I can start to help some of those people and change the story and show, Hey, look, if you actually pay people fairly, even to build their own thing where they have a lot of equity, you’ll get a return and it’ll be a great return. And everybody wins. And that goes back to what we talked about last time, which is entrepreneurship is not a zero sum game and investing shouldn’t be either. It shouldn’t be like investors win and company owners win, and everybody else loses, right? It shouldn’t be that investors when in the company owners lose. That’s why I’m a big fan of going as long as you can, before you give up any equity, because you’ll give up more of your company the earlier you do do it. So it’s not sexy. It’s just not that. And the more you can get that out of your head, don’t look at Zuckerberg and go, Ooh, he lives. He’s a billionaire now. And he’s got his yacht in his private planes. And you know, that’s going to be me in the next two years of my startup. It’s just not. And if it is, you should probably question whether or not you’re putting your money into the right things and how sustainable what you’re doing is for the long-term success and the larger success of your company. I don’t want to fly in private planes for a year and make, you know, 700 grand for a year and then have it all come crashing down around me. Cause I did the wrong things or because I wasn’t being smart. I want to build a company. And in five or seven or 10 years, I want to have $500 million in my bank account because then I can take 400 million of it. Live a very good lifestyle on the rest, on the last a hundred million, right. And put the other 400 million into helping other people and changing the conversation. And like in 20 years, none of this has to even be a problem anymore in this. And we can be having a different conversation about what building a startup is. So it’s an important piece of my why. And I want you to get that because all of this stuff is what gets me out of bed. Not the money, not the sexy lifestyle, not the Oop, private planes and new big vacations and who, you know, big houses and fancy cars. And yeah, that’s fun. And I’m going to do some of that stuff when it’s appropriate, but that’s not what it’s like building a startup. That’s not the story of an early stage startup. So I want you to get again, the why has to be bigger than you think it’s got to be way bigger than you think, because it’s not sexy. Okay. So I wanted to address that. I heard that and you know, I’ve heard that a couple of different ways, a couple of different times. And so just let’s get it all out there. We are not bringing sexy back. We are bringing startup back. All right. So then the topic that I wanted to talk about today is I hear this question a lot. What is traction and how do I know if I really have it? Okay. Because you’re going to hear this a lot. Like you’ll hear from certain investors, they’ll say, I really like what you’re doing. Come back and talk to me again. When you have traction or you’ll hear from a bank. Well, it really won’t hear traction from a bank. They want history and they want financials and they want as little risk as possible, even including they don’t want you growing very fast.
Like they have a growth tolerance. So if you grow too fast, they don’t like that. As much as they don’t like you not growing fast enough because remember banks make their money off of waiting for you to pay them interest over the whole period of a loan, right? So they want you to grow fast enough that you can make the payment, but not so fast that you can pay off the loan early in there they’re out of their interest, right? So you have to kind of understand the motivation of banks, but with investors sometimes with strategic partners, you’re going to hear the word traction, come back to us. When you’ve got traction, we really like this, but we want you to have more traction. So what does that really mean? And how do you know if you have it? The easiest form of traction to understand is revenue, okay, this is money into your company, income into your company. And the thing about traction, that’s different from like profit or cashflow positive or anything like that. Traction means you make money. Doesn’t mean you make a lot of money. It doesn’t mean that you’re profitable. Doesn’t mean you’re cashflow positive. It means you have income that shows there are customers willing to buy, willing, to participate, willing to make a decision to purchase with you and your product. Okay. That’s traction as related to revenue and honest to God, I have seen investors say no to a pre-revenue startup have that same startup come back six months later and say, we made 10 grand. And all of a sudden those investors are interested. It’s not a lot of money is what I’m saying. You don’t have to make millions of dollars in order for it to qualify as traction. They just want to see something. They want to see that you can sell. You can bring in customers and those customers pay. And they also kind of want to see, like another form of traction is knowing more about what it takes to acquire a customer. So understanding your CAC or your customer acquisition costs, understanding the lifetime value of a customer. You know, you can kind of project those things. And these are things that kind of get into a longer term companies. But as a startup, you can learn a lot by understanding your churn rate. And how long does it take you to nurture a client before they buy and all those things. Those things can be a form of traction as well. Here’s another one, a list. Now list building is not as valuable as revenue for most companies or for most investors. Okay. But it is a form of traction that proves your messaging in a way that you are attracting people to give you something that more and more, they hold very valuable to themselves, which is their email address. There is value in that, and there is inherent data driven value in having a big target audience, especially if it’s a target audience in a specific niche, that’s difficult to acquire or access in other ways. Okay. So if you’ve done the work to build a list of a hundred thousand early stage startup entrepreneurs, that’s an incredibly valuable list because that is a very difficult target to create. Now we’ve started doing this with the way that our ad strategy is, and we’re going to refine that process over time, but it’s a different kind of traction for us as founders and Precursa. That’s the only traction we need for us to feel like this is de-risked okay. And actually for Paige and Sarah and I, the work that I’ve done over the last almost 14 years with various companies and people and early stage startups that already had incorporated themselves and people who were just like, I have this idea now, what do I do? And getting paid 10 to $20,000 or more. I mean, I have clients who have paid me several hundred thousand dollars working with them to build their startups, right? That is proof enough for us that there’s a market for this. And all of the conversations I’ve had over that time where people really wanted to work with me. And they were like, can you do it for five grand? I could probably come up with that. And I know this market is big and I know there’s an appetite. And I know that there’s a huge group of people who just want more information, want to de-risk this thing. If they can. A lot of those people are women. Eva is a huge user persona for us. We talk about her and Cody are two user personas in our first few episodes, but Eve is a huge one because her real desire is de-risking.
Doug is as well. Doug falls more into the Eva camp than the Cody camp. So for us, we have the kind of traction that makes this a no brainer because we technically have been making money doing this. I mean, my company made 250 or $300,000 last year alone, just doing this kind of work. Okay. So I know there’s revenue there and I know that it, it doesn’t take very much to get to the place where we have the number of users that we need to be cashflow positive and making this thing work. I know it’s not going to take more than a couple of months to have enough traction that we’re going to have a lot of our investors coming back and saying, I want to put in more money. Like, do you need more money? Right. But the user list may or may not be a form of traction in the eyes of your investors. Okay. So that’s another form of traction that might be useful. Grant money, like other invested money is also a form of traction. So here’s, what’s kind of crazy. We put in about 150,000 when all is said and done to get us through either July or August. I can’t remember. And that in itself is actually a form of traction because it’s invested money. The 500,000 that we’re raising is additional traction in invested money. And for some reason, when there are other investors, when other people are seeing value in being willing to put money in other people will too. So oftentimes you’ll have investors that will say, I will give you a hundred grand to finish out your round. So you go raise the other 400 and all finish out your round with the last hundred, or we’ll do two 50. If you can raise the other two 50 and you’ll hear that a lot. And the reason is because they like it. They want to invest, but they want to know that other people are going to be along on that ride and see what they see too. And if no one else is willing to go on that ride, then they’re not willing to risk the money. And that’s again, another form of traction. So this is what traction is and how, you know, if you have it, you look and you say, do we have revenue? No, we don’t have revenue. Do you have a product out in the market that could be sold? That’s another form of traction. Is your MVP out there and available where it could be purchased by someone that is a form of traction as well. Now, if you have a big list and you have an MVP, but you don’t have any revenue, that’s a big red flag. Okay? And that’s the whole purpose of Precursa. We’re trying to prevent that scenario. If getting to that MVP and getting to that list cost you a bunch of money for most people, getting to that stage, cost them at least 150 to $200,000. That’s a lot of money to realize that you don’t have a product that people are buying and it’s, you don’t have to go that far to know whether or not people are going to buy. That’s. The whole of the process that we go through is we can know that information very, very, very early on. You can say, I have this idea for an app. Great. Let’s go figure out if it will sell and you don’t need an MVP and you don’t need to have a big list and you don’t need to run marketing campaigns and you don’t need to pay developers to learn that data. So those are some forms of traction and how, you know, you have them as you just look and you say, you know what sizes are list, what sizes are user base. If you have a proof of concept with a hundred users, that’s good traction. And I noticed, I said, proof of concept. If you have an MVP, you probably need more than, you know, 50 or a hundred users. But if all you have is a proof of concept that costs you 20 or 30 grand to get, and you get 50 or a hundred people paying you for that proof of concept, that is a good indication that you have got something really good, right? So that’s another form of traction. So what I want you looking for is you’re looking for objective proof, right? So a lot of the work that we do in Precursa is about getting objective proof through interviews and data analysis. But there comes a point where we say, let’s get something out there. Let’s get something. Even here’s another way that you can get some traction improve, whether or not you have something that I love to use. Sometimes it’s pre-selling okay. And some people would call it vaporware. I don’t really call it that. But what, what you’ll do is you’ll run some AB testing ads like testing, some ads like in Facebook, which is a really great way to AB test ads. Cause it’s really easy to set them up and easy to get a target, a demographic. And you’ll set up a couple of different landing pages and you’ll drive traffic. And you’ll see, what’s my click through rate. How much is each of those clicks costing me? And then what’s the conversion to whatever I’m asking people to do on those landing pages. Maybe it’s build a list. Maybe it’s buy like $7 download or something, right? Like you’re trying to come up with something that shows you, are they willing to take action on the thing? Like, are you messaging it well, but then are they willing to take action on it? And that’s also a form of traction. Now, like I said, that could be building your list, which is the lowest form, but it could also be, Hey, we have this course, we sell for $19. That is a little piece of what we do. And you’re going to get way more value out of it. And if you can sell a hundred of those, that’s pretty darn good proof. Especially if what it costs you to sell those hundred and make $1,900 was $400 in ads. Now you have not only proof that people will buy that’s traction, that’s revenue in your company. Right.
But you also have more information about how much does it cost to get that customer, obviously at that price. But there’s some extrapolation you can do there. And how quickly do they buy it? Like you can learn all this stuff. That’s all traction, traction is going from. Remember I gave the example of the light bulb. Like an idea is a lot of times represented by a light bulb. We even have a video like a short two minute or minute and a half video about what is Precursa on our website. And we have this light bulb that like lights up when we say the word idea, but notice how a lot of times the light bulb is floating in space. It’s not connected to anything. It’s, it’s just floating like there. So if you go on like Unsplash or Shutterstock and you do a search for idea, a lot of times you’ll see a light bulb and that it’s like floating in space or it’s not tethered to anything. Okay. Recursive process traction is about tethering that light bulb to the earth and solidifying it in a way where it can take off. Think about traction in a car. Traction control is about making sure that enough power is going to the wheels that have traction, that, that are touching pavement. That can actually go with the gases pressed to make sure that when you press the gas or when you press the brake, the motion you intend is what happens in the car. Same with your startup. We’re trying to take that light bulb and put it on the ground in a way where there’s traction. So when you push on the gas, when you add money, when you add resources, when you add time, it moves forward, a floating light bulb doesn’t really move forward. I mean, that is more like a balloon, right? Like, think about, you can hit a balloon really hard and it might move a little bit, but then it just kind of stops. Like it just sort of, it just kind of hangs there, right? And that’s why balloons make terrible volleyballs. What we’re trying to do is we’re trying to take that idea ground. It literally grounded it not literally figuratively grounded. And then that is what gives it traction. So prove grounds it more. And the more grounded it is, the more opportunity you have to create traction, which is what investors want, which is what you want as a founder, because that’s what turns into growth. Okay. So that was a really great question. We’re going to talk a lot, a lot. You’re going to hear me say, you know, getting traction, getting traction, especially as we get closer to launching, and we’re having more conversations about traction and especially with our strategic partners, strategic partnerships are interesting because if you can get one or two really good ones before you launch, so that you launch with brands behind you or, or brands sort of like linking arms with you, because they like what you’re doing, you can borrow a lot of their brand value or their brand trust, which helps you create that with your users a lot faster. But there are a lot of strategic partners that will much like an investor say, yeah, we love what you’re doing. Come back when you’ve got some traction and that’s perfectly understandable and perfectly acceptable and totally makes sense. You just have to be aware of that. That might happen. And so make sure that you’re not like banking on one or two specific strategic partners. Look for lots of them. Like if you start looking around, I’d be willing to bet you in almost every case, I’ve been able to come up with a list of at least 20 or 30 strategic partners that my clients could be talking to who, and a lot of whom will want to get in early. And we’ll see it as an opportunity, not only for their audience, but also for them to grow their own business. Right? So at some point we’ll talk more about strategic partnerships and sort of how to use that to your advantage and et cetera, et cetera. But today I just wanted to focus on that traction thing. Uh, because I’ve said that a few times and you know, I, I’ve seen a couple of emails now come in where I’m like answering the question. Well, what is traction? What does that really mean? How do I know if I have it? How, you know, if you have it, it’s not you and your idea and your developers kind of floating around saying this thing’s going to sell itself. Right. It’s actually selling, or it’s actually turning into real end users who are interested and who are either buying or, or a form of buying by putting their name on a list. Right. Okay. So if you have questions about other things I’ve said ever shoot me an email, email@example.com, or, you know, reach out to us on social media or whatever. So in the coming weeks, we’re going to talk about next session is going to be a founder session.
Yay. We love it when Paige and Sarah come along. And then in one of the next few sessions, I’m going to get one of my favorite entrepreneurs who I’ve worked with in the last few years. There’s two of them that I’m thinking of. And it just depends on who has availability and who can jump on on a Friday morning with me, but I want you to hear from some other people. So like I said, I’m going to start adding in probably once a month, other founders, other entrepreneurs, you know, people who have succeeded, people who have failed. People have done both people who are working on projects actively. Now, people who aren’t, who have done stuff in the past. And why aren’t they now, because I want you to hear other perspectives about the journey, because I think it’s really important to get a full picture of it. You know, I’m always going to paint a more bleak picture probably. And that’s only because I want to be the person that you can depend on to tell you the truth about what does this really look like and what am I in for? Because the media is not going to tell you that social media is not going to show you that. And the reality is a lot of people want you to think it’s going better than it is because they’re disappointed at the journey. So it’s hard for them to be transparent about that journey because they’re dealing with their own feelings of, oh, this means I’m a failure. All that’s like, I want you to feel like you can be prepared. And so I’m always going to say, this is the lowest common denominator to prepare for, but I do want you to hear other perspectives. And I want you to see how different journeys look so that you can kind of, it also might give you ideas, right? Like you might hear somebody say something and go, oh my gosh, that totally made me think of this. And if I did this, this and this, I could have traction in my startup in the next like month. If I could do these couple of things, that would be brilliant and would cost me any money. So I want you to have some other stories. I want you to have some other perspectives, but I also want you to know, I will always tell you the truth. Like I’ll always tell you the bleakest darkest truth, because I think it’s important because it means if you understand that, you’ll know if your, why is big enough. Okay. And I always come back to that because 95% of entrepreneurship is about mindset. 4% of it is about driving ambition. 1% of it is your good idea or your a great idea, right? And I truly believe that. I think that’s why I’ve been successful as many times as I have is because I don’t get too attached to my ideas. What I get attached to is the why. And if it turns out, as I’m talking to people that why for them looks like a different solution or is a different kind of problem than the one I set out to solve. Originally, I’ll go solve it the way that they need me to solve it. That’s my job as an entrepreneur and as a founder and as an innovator. All right. So if you have questions, email me, firstname.lastname@example.org. Find us online precursa.com, social media, more podcast, episode blogs. There’s so much stuff that’s going to be happening over the next two to three months as we drive towards launch. And I am super excited to tell you all of those things, preview and hint, we are setting up the video recording studio, which is like so exciting. We started at the other day, we got all of our backdrops, our seamless paper backdrop set up, uh, today actually our video guy who happens to be Sarah Jelly’s husband, Ben is coming in and we’re going to do some tests with the camera to figure out lighting and do we need other kinds of lighting? We’ve got our sound equipment coming next week, and we’re going to be doing some screen tests next week. So it’s very, very exciting time over here at Precursa. And I’ll tell you more about that next week will be our another founder session. And then the week after that, we’ll probably talk more about video and then whatever else there is to talk about. So as always happy entrepreneuring. Go be your big, amazing selves, innovate, create, invent; exactly what you’re supposed to be doing. And I will see y’all soon.
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…