Pre-Launch and Fantasies and “Easy” Money, Oh My!
In this episode, we talk about the launch of our website, how we figured out an ad strategy to get traction pre-launch, and what it really looks like trying to raise money for a new startup.
Welcome to Precursa: The Startup Journey, a podcast hosted by Cynthia Del’Aria, who dives into the ins and outs of building a tech startup from scratch. With full transparency and honesty, she reveals everything, from idea, to launch, to revenue, and beyond. These conversations will help you understand what you need to know for your startup! In today’s episode, she shares about the exciting things happening with Precursa, along with what strategies they have held on to in order to bootstrap and weather the storms.
Cynthia starts the conversation sharing about Precursa’s exciting website launch this week. She shares about why it is important to put something into the world in order to gain early SEO traction. Learn that it takes time for search engines to index you for key terms and to obtain the domain authority you desire. She touches on issues like marketing, advertising, and a good-sized email list. Precursa will be launching ad campaigns soon to help drive traffic towards their landing page, for traction and audience engagement. Eva and Cody are their ideal client personas and the identities they have defined to help determine what strategies ought to be utilized. Know your audience and understand the marketplace; invest more time and money once you have some understanding and traction. Cynthia shares about indicators that can help you find your product-market fit and whether you need to pivot or not. The more you can spend, the more opportunity you have to get effective data quickly. Create connection by being in front of people in more places, so they start recognizing your brand. Find out why email sign-ups are so essential.
The episode shifts towards looking at challenges and how to face them head-on. Cynthia shares about the challenges with investors, as their money is worth more than all the time and energy you are going to put in to use it. Money is king. In order to deliver on your promises, you will have to give part of your company away – it is hard to do cheap in the beginning. What about when it takes longer than expected to execute on the various aspects of your company? Cynthia shares about Precursa’s own issues in getting put off and the amazing deal they secured to not give away as much of their company equity. Stuff happens even when you think you have “easy money” – you must be prepared. How much money will it really take? Raising funds is the hardest part of a startup, but most startups fail, not because they do not get enough money, but because they have no product-market fit or the right skills and knowledge on their team. Learn that people go after money too soon.
How many companies lay it on the line to help you know how they got somewhere and what they are doing? This transparency is the goal Precursa has in helping others. Stuff goes wrong, and we all get stuff wrong. Precursa’s desire is that you not be at the mercy of something you cannot control. With confidence that is backed-up by data, you will feel confident about what you’ve signed up for.
Learn about the sensitivity analysis in a pro forma, and how it helps you communicate to investors more effectively. Investors are most interested in the worst case scenario, and what the cash flow looks like in the midst of that. If you cannot say at what point you may run out of money, then you need more data, and you are still living in the fantasy. Why should you know a little about everything in your business? Cynthia tells you why and emphasizes the need to talk with people and get more data.
As the episode draws to a close, Cynthia provides a few takeaways. With the launch of the website, blog, first podcast episodes, and advertisements all on the horizon, they are excited. Learn from Precursa how you can weather the things that go wrong, without going crazy. With an inside look at building a start-up, Precursa wants you to see what this really looks like. Don’t live in the fantasy, turn your idea into something real – something that makes an impact and delivers on the vision you have in creating it!
Be sure to like, share, and subscribe to Precursa on your favorite podcasting platform and tune in for the next episode!
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 everyone. Welcome back. This is Precursa: The Startup Journey. We had some exciting stuff go down in the company this week. So first of all, our website launched, we’re so excited. So when you’re building a startup, there is a point at which you have to put something out there in the world in order to start gaining early traction. So, obviously right now, we don’t have an MVP product out there yet for people to interact with and subscribe to and buy. What we do have is a single page landing page with a blog to back it. And the purpose of that is to start getting that SEO, traction, understand that, getting SEO, not maturity. What’s the word I’m looking for? Getting SEO, not dominance, man. That’s going to drive me crazy. I’ll think of it. But having search engines recognize you as an authority on a particular issue, it takes time. It’s not like you put up a website and all of a sudden you’re indexed and all of the major search engines for the key terms that you want to be searchable for, right? Like that takes time. And so you don’t want to wait until launch day to do that because then you’ve got another six months to a year to build up your domain authority, right? So launching a landing page, something that is branded and has your tone of voice and includes all your SEO of all keywords in the copy as soon as you possibly can gives you that time to build up that domain authority, right? It also gives you the opportunity to start doing marketing and advertising, to start getting signups onto your email list. Having a good size email list is a form of traction, okay? Now for us in about two weeks- so sometime, this is the beginning of April, at about mid-April, we’re going to launch our ad campaigns, which means we are going to be putting ads out there. We’re going to be testing stuff. We’re going to have some sales pages. All of that is designed to drive traffic to the landing page, get signups, get traction, and start engaging with that audience. Now signups could mean ideally email list, right? It could also mean follows on various Instagram channels. Now, remember we talked about Eva and Cody. Eva is probably more likely on Facebook, possibly on Instagram because of her kids are on Instagram, but her main one’s really going to be Facebook. So there’s going to be some Facebook ad strategy in what we do. We’re not going to get away from that, right. For Cody, his demographic is he’s probably on Twitter, definitely on YouTube. And so we’re going to focus on those areas as well as like general searching, you know, like Google ad words and that kind of stuff. Right? So very exciting. We did launch the website this week. We are in the process of putting together all of our initial blog content. And this podcast will be part of the content that’s available through the website. Also through obviously your podcasting platforms, wherever you’re listening to it right now. And all of that contributes to the domain authority for SEO. It contributes to the searchability of it for SEO, but it also starts to establish our knowledge and authority in the area that we’re operating in. Now, why does that matter? It matters because if I ask you to buy something and I do not show you that I know the audience, that I understand the marketplace, that I understand your needs and your questions and your concerns and all of those things, you do not have a high level of trust that whatever I’m trying to sell you is going to meet your needs. So remember when we talked about user personas, we are using the terms that our target markets use to talk about this problem in everything that we do, it’s on our landing page, copy it’s in all our ad landing pages. It’s an, all of our ads themselves. It’s in the video that we’re working on to go on that landing page. And that’s because the more our audience probably you sees themselves and the things that we’re saying, and here’s the words they use in the things that we are saying, the more they will trust that we actually know what we’re talking about. So very excited the website launched, we are in process on, we have a final script on the video. It’s basically like we’re doing a one minute explainer video for lack of a better term, talking about the traditional way of building a startup, which is the I’m going to hire a developer and I’m going to go for it based on what I know.
And I’m going to do a lot of feedback loops after launch and the costs associated with that versus the Precursa model, which is follow this roadmap, get your product-market fit done ahead of time, understand what it really takes to build this thing that you want to build from a time perspective, from a money perspective, and then be able to make that decision and invest that time and money with understanding your market and understanding and possibly even having some traction. That’s the cool thing about interviews is I always, at the end of an interview, I always ask, okay, now we’ve had this conversation, would you be interested in being added to the email list to be notified when this thing becomes available? And I love that question because if I’m finding a lot of people are saying, yeah, I absolutely want to know when that’s available, that’s also a really another great data point to be able to point to do I have something here or not? Now, what’s interesting on that point, I’ll come back to some of the stuff that’s been going down this week, but I saw this this week and I thought it was really, really fascinating. Okay. I don’t remember where this came from, but basically man, it’s going to kill me. His first name is Sean. He’s worked with a lot of big companies going from startup to gain early traction and then future traction. He sort of this guru in building startups. Right. Which makes it even more ridiculous. I can’t think of his name right now, but he said that his favorite question and the thing that is the, one of the best key indicators of whether people really how good your product-market fit is, is asking them, how disappointed would you be if you couldn’t use this product? And like what a brilliant question, right? You know, there’s lots of different ways of getting at that question, but asking it in that way, what he found in all of his research was at 40%, if at least 40% of people indicate that they really would be bummed. Like they couldn’t live without it, or they would hate if they couldn’t use it. That is a very, very good indicator that you found product-market fit, you know what you’re doing and you’re building the right thing for the right people. If you’re getting less than that, that’s also a sign that either you need to pivot a little bit, or you’re not describing it well, or, you know what I’m saying? Like, and I love that it’s something that we get to in different ways, but I love the way he just asks it right out. And he’s asking it in a way that sort of introduces some bias, which next episode we’re going to talk about, like removing bias. And then how do you analyze all of this data that you got? Right. But it introduces a little bit of bias because you’re putting in their mind the concept of disappointment in asking the question. But if people feel strongly enough that, well, I wouldn’t be disappointed. I mean, it would be, I might be like, Oh, that’s too bad, but I’m going to move on with my life and keep going versus, Oh man, that would be like, really like you would present it and then take it away. Like that would be a huge bummer. You’re going to get a sense for where are you in the market? And I love that statistic and I will find that post and I’ll make sure that we include it in the show notes or on the blog page with the transcript on it. Because I just think it’s a brilliant question to ask anyway, all that, to say the website launch, we’re super excited about that. We are about two weeks away from launching our ad campaign. We’re talking to the company, that’s managing all that for us on Monday. How much are you spending on ads you might ask? Well, the reality is that in order to test and figure out what works really well and what gets us the best leads and the most traction and hence the most sign-ups we have to sort of scattershot it a little bit in the beginning. I mean, it’s not really that random because we know our personas really well. And the marketing company, the ad company we’re working with is really good at researching those personas and saying, okay, those people are most likely to be here and they’re doing this and whatever, right. But we have to try some stuff. And so the more you have to spend on something like this, the more things you can try at a high enough threshold of spend in terms of ad spend that you know, whether to trust the data you’re getting or not. So for example, if I go spend $20 a day in Facebook ads, it’s going to take me a while to understand whether or not what I’m targeting is actually effective at the level that I want it to be effective at. If however, I can go to Facebook and spend $50 a day, or even a hundred dollars a day, I get that data a lot quicker. Now there is a certain time component because remember not all days are created equal on the internet. Not everybody is browsing Facebook nearly as much on a Sunday as they are in a Monday morning when they get to work, right? Not everybody is searching for things related to building a business on a Saturday or over a weekend as they are mid-week when they’re ticked off at their boss. And like, why am I still doing this? I should go figure out a way to build my own company, right?
So all days are not created equal. And so it takes at least a week to understand the trends of your target users, but in that week, if you’ve spent enough, and if you’ve tested, if you’ve designed your tests really well, you should have really good data that allows you to, in the following weeks and months, hone in on the channels and on the days and the timeframes and all that, that are really, really lucrative. Okay. Now there’s another aspect of this too. Okay. And that aspect is the more someone sees your name, even if they never click on the ad, even if they, you know, it’s just, they’re sort of scrolling by it. The more they see your brand, the more they see your name, the more they see your logo, the more it will become normalized for them. And the more likely they are to talk about it when it comes at them from a second source later. So let’s say, for example, Precursa shows up several times in my feed. I never click on it. Maybe I read the first sentence or two of it every now and then I’m like, okay, I get what they do. That’s cool. And then later, a friend of mine says to me, Hey, I just started up this thing Precursa. It’s really cool. Like, remember that app idea I told you about. I’m totally using Precursa to work that out and figure out if I could build it. I am more likely to, because I want to create, because human beings are designed to create connection. I’m more likely to be like, yeah, I see them all the time on Facebook. What do you think about it? I want to be in the know. So the more in front of people, you are not obtrusive or, or annoyingly, so right. But the more people have the opportunity to start to recognize your brand and associate it with something, and then the more that happens with multiple sources, like I see it a couple of times on the internet and then I hear it on a radio commercial. And then my friend talks to me, those are three different ways that I just heard about that. It’s going to click in my brain what you’re doing and whether or not it’s for me. So going back to the original question, it takes money to be able to cover all of those various things in order to get good data and eventually start honing in on the channels and the areas that get you real traction, meaning for us emails on an email list and followers in social media. Now I kind of hate followers as a metric. I think it’s sort of what I think of as a vanity metric, more than anything else, but if you’re really good at creating engagement, what it can do is create brand value, brand loyalty. Again, it gets people to recognize your brand when they see it. And sometimes it’s just that extra little push of something, whether that’s a radio ad or on TV, or they hear me on a podcast, you know, somebody else’s podcast. And they’re like, Oh my gosh, I know about that company. I should go check them out. That’s really what follows are good for is again, just continuing to build that brand and get in front of more eyeballs through other people’s feeds. Emails are really where it’s at. And the goal is if you can pay a dollar per email address, that’s killing it. Okay. Like that is the ultimate goal to fine tune and hone all of your messaging in your marketing. So that you’re basically paying a dollar in email sign up. The reality is we’re wanting to target 10 to 15,000 emails on a list before we hit launch day, sometime in September. So you would think, okay, well, logically that means we need to spend 10 to $15,000 to get that. No, we actually have to spend more than that because of all that stuff that I talked about in the beginning, which is we have to do some testing and we have to start to understand who is our market and how do we resonate with them best and where are they in what days are they there, et cetera, et cetera. So in the beginning, we’re going to be spending about $5,000 a month. And there’s a time at which we can probably hone in and ramp that back a little bit, but expecting to spend somewhere in the neighborhood of $5,000 a month leading up to launch and then potentially beyond is not unreasonable. And in fact, if we could do 10,000 a month, we would do it. Now that brings to the other piece about this week. So I told you in the very first episode, we are not new at building this business. We’re not new at building startups. We’ve all been down this path before we are all serial entrepreneurs. And so when we started having the funding conversation, we looked at, we built pitch deck, several pitch decks actually, we talked to a bunch of different investors. We looked at going down that road and a very, very killer deal across our desk that made the debt financing path so attractive that we decided it was worth the risk. And I, I want to be very clear the way I was in the previous episode, we talked about this. I do not recommend this for most people. We’re very experienced. We know what we’re doing. We are really, really clear about our page and Sarah and I’s collective ability to recap this money, regardless of whether or not Precursa does what we think it’s going to do or not.
That said the terms had to be amazing. Okay. And they are. So basically we’re getting $750,000 at about 1.3% over seven years. That’s ridiculous. And the real boon for us that we’re not giving up equity to do it. And the thing that is always such a challenge when you bring on investors is their money is worth and I’m putting the term worth in quotes, but their money is worth more than your time and energy and all of your intellectual IP and all the stuff that you’re going to do to turn their money into more money. Why is that? So it’s only because of agreement, that we have agreement in our culture and our world that money is- cash talks, right? Money’s king. So when we started talking to investors, we realized how much of the company we’re really going to have to give away because in order to build something that delivers on a lot of our promises is a fairly intensive development effort. And again, we’ve got people on our team that we’re giving a mix of cash and equity to her who are really, really brilliant, who are architecting really great stuff. But this is the kind of idea that’s really hard to do super cheap in the beginning. There’s a lot of ideas where I help people get stuff done for less than a hundred thousand dollars sometimes. I mean, I’ve got one client that I think, you know, we got their whole tech done for like 35 grand. And it’s because we white labeled a product that we could kind of like work with the team that designs and builds and produces that product to get the custom elements that we needed. Like super, super cheap, because the majority of what we did was based on their platform, right? This wasn’t one. And we researched that. Let me be clear about that. We talked a lot and we looked at a lot of options for build or license versus buy versus white label. I mean, we looked at all of it and we just realized that in order to create the value, the way that we know we need to, more and more, we were having a customized somebody else’s thing. And there was only so far that that would go. And so we made the decision, okay, we’re going to put 200 grand into development. And so for us raising capital, we all talked about, could we bootstrap this? Yeah, we could have. The thing that we didn’t want to do was we didn’t want to skimp in a way that pushed out our launch even further, because this is a very hot topic right now. I am getting so many more calls every day from people who are like, I really would love to build my own business. I got laid off last year, or, you know, I’m starting to realize how much I hate the culture at my office or whatever it is, right? This is a conversation. There’s a lot of people who are thinking about starting up their own business or building their startup or turning that thing into something that makes them money. So we want to strike while the iron’s hot, that said this was a really great deal. It made sense for us. And, and so we went ahead and started working with our friend who runs the VC firm that’s sponsoring this whole thing and, and got an application. And now, now here’s the reality. And this happens with investors too. Stuff goes wrong. Like things are not always happy path. Right? So when we originally put in the application with them, we know the guy who who’s running this whole thing really well, he’s done some other deals with us. He was like, yeah, no problem. Let’s get you in the queue. It takes us between 30 and 60 days in order to close this stuff. Well, this was the first round they had ever done on this. So a lot of stuff went wrong. Like a lot, they run into snags, things they couldn’t foresee. It was kind of a pardon, my French, it was a shit show, the first round of this. So it took a lot longer than they thought. And he came back to us just earlier this week and said, okay, we’ve learned a lot. You’re in the queue starting next week. It’s going to take us a lot less time to get this stuff closed. And we know more about it now. And we understand sort of the mechanics of what we’re trying to do in a way that we didn’t two and a half months ago when we first started talking to you, this is going to be a lot smoother. The second time around, you know, you’re in for the second round. Now we were hoping we were going to be closing sometime in April for cash. Now that’s still possible given what we learned from him this week, but more likely it’s going to be sometime in May is my guess. Now we are still bootstrapping this. In the meantime, we have not taken our foot off the gas. So a very logical question came up from a friend of mine, who I was talking to about this about earlier today. And she said, well, what happens if this round doesn’t come through and they keep putting it off and putting it off, then we’ll keep, we will get creative. We will find ways to pull in people from our community, we’ll find other ways to leverage equity because we have a lot of it.
And there’s always the original investors that we were talking to back in December and January, who would happily get back in the conversation. Now, here’s, what’s interesting. I went to one of my investors who also happens to be a very, very good friend of mine and a mentor to me. And I said, Hey, this deal across my lap, where we’re being offered three quarters of a million dollars, 1.3%. You know, these are the terms of the deal. It makes me nervous taking debt. Like I don’t like to do that. And he said, I would take that deal in a heartbeat because you’re not giving away your company, which means you can pivot things. You can do the things you need to do in- Cynthia, over seven years, can you make $750,000? And I was like, well, duh, if I couldn’t do that, then I wouldn’t be on this journey anyway. Right. So I know, Oh, I could go back to him and say, Hey, this fell through. Can we get back into a conversation about having you invest? Here’s really what we need. And we could pick those conversations back up. The thing to know about this, yes, this happened, you know, stuff went wrong during a debt financing deal. Stuff goes wrong with investors too. I mean, I worked with a client in my consulting company who for months, we thought we had an investor to put the next chunk of money in to keep this company going for months and months and months. And we were finally at the end of the deal and there was a shift in the market in some place where he had another investment, totally unrelated to COVID. This was actually in 2019. And he was like, I got to take a step back for another 60 days. Like I gotta make this other thing work, and then we’ll come back to it. Stuff happens. So even when you think it’s easy, money stuff is going to happen. So you have to be prepared. You have to, that’s why your performance so important, understanding where are you going? How much is it going to cost you to get there? Really, how much is it going to cost you to get there in order to be able to get the kind of traction you need, have all of your assets, build your software, or buy your law, whatever that is, how much is it really going to take so that you know how long you can bootstrap and how long you can weather for the storm of raising funds? Raising funds is the hardest part of building a startup. Now it’s not the biggest reason why startups fail. Okay. It would be easy to think that most startups fail because they don’t get enough money. In fact, according to Crunchbase, they did a post-mortem of startups in 2018, and they found that only 33% of startups actually failed because of a money problem, 42% failed because they had no product market fit. Nobody wanted what they were building. 46% of companies failed because they didn’t have the right skills on their team. And they didn’t know what they were doing. Those two statistics are far more likely to happen to you then that you run out of money. And why is it that those two statistics are more prevalent? Because people go after money too soon. You have to have all of the ducks in a row. This is the whole reason why Precursa exists, by the way, I’m telling you all of this, because this is the process we have used. This is the process that I have used to build and sell to companies, you know, in my career for my, my other SaaS company that I have, you know, in the commercial airline space, I have been eating this dog food, my entire career. It works. The reason that I am successful so much of the time is because I really do not assume anything early on. I just don’t. And so if we were at this point in the game, talking about borrowing three quarters of a million dollars, and I didn’t have 200 plus entrepreneur phone calls under my belt, talking about this, asking them insightful questions, getting the data, working through the user experience and the user journey to really hone in on our user personas, it would scare the crap out of me because that’s a lot of flippin’ money, but you know what the reality is. I don’t have a concern about that level of money because I know enough to know my pro forma is not off by that much. So I say all this, because one, I told you we’d be totally transparent. But it’s interesting. It’s the interesting part of the journey. Like how many companies sort of lay it on the line so that you get a view into what’s really going on and what did it really take to get there? That’s our whole goal with this. I want you at any point in this journey, whether you’re with us from the beginning or whether it’s five years from now in 2026, and you know, we’re having some exit event or something, you know, has transpired and you come back because you’re like, huh, I want to listen to that whole story. I want you to be able to see the evolution all along the way that level of transparency is what it takes to turn your vision and your idea of, Hey, I’m going to build a startup.
I’m going to build an app or whatever it is from this fantasy, which is wow, overnight success and wow, no challenges along the way. And that looks so easy. And now he’s a billionaire and Oh my gosh, that’s so amazing. That’s a fantasy. What it actually takes is this journey that we’re on now, which is stuff goes wrong. We get stuff wrong. We have to float things. I mean, my company owns the IP in Precursa because originally it was developed by me as part of Raika Technologies. But Paige and Sarah are bootstrapping their pieces as well. You know, they’re putting real money in and we’ve looked and said, how long can we keep doing this before it becomes a problem that we have to go after something else. We know exactly what those numbers look like. And that gives us power. We’re not at the whim of an investor. We’re not at the whim of the venture capital group and their ability to put out these funds, right? Like we are not at the mercy of something we cannot control. That is the reality that we are trying to create for you in the Precursa experience. We want you to have this journey where the confidence is backed by data and you know exactly what you’re signing up for. And that’s the whole point, like, this is exactly the whole point of what we’re doing. So because I’m a finance geek, I love math. Okay. Pure mathematics, that was totally my jam. But I also love finance. Like it’s really fun putting together a spreadsheet that says, okay, what is our OpEx? Do we have any capital expenditures? What’s our staffing model look like? What other pieces or expenses do we need to plan on? What do our revenue streams look like? And what’s the mix of those and what are our sales cycles? Like, I love pulling all of that together and getting sort of that top sheet roll up view of this is what it looks like. And this is what you can expect within a certain margin of error for this company to be able to do, assuming that you can execute on the promises of it. Right. I love that it’s so much fun. It’s one of the things that you’re going to see in our pro forma generator in the platform is that we always do a sensitivity analysis. A sensitivity analysis basically says if we are wrong by plus or minus a general offset, okay, you’re going to see it referenced as a standard deviation from the mean, okay. So the mean would be we got it exactly right. We were able to predict a hunt with a hundred percent accuracy, and our pro forma matches reality. Even with companies that have decades of forecast ability to look at, that’s really unusual. So usually for most companies that are fairly mature, your sensitivity analysis is maybe one standard deviation from the mean, okay, which means you go one factor out either we undersold ourselves and we did one factor better, or we oversold and we did one factor worse. And in anywhere in that range of one standard deviation off the mean we know exactly what we’re in for. When you start talking about younger companies and getting into startups, you actually go two standard deviations off the mean and for a true startup that has no forecast ability, we have no history to prove our level of ability to sell, to prove what our attrition rate looks like. How many customers do we gain in a month versus how many do we lose? We actually pad that quite a bit. And so when I build a sensitivity analysis, I build it at about 32% plus or minus. Now everybody would love to be in the 32% plus meaning we under forecasted revenue by 32%. And we over forecasted expenses by 32%, which means we have way more money than we ever thought, right? Investors, they would love to see that, but really what they’re interested in and what you should be interested in is what’s the worst-case scenario, which usually means we overestimated our revenue by about 32%, and we underestimated our expenses by 32%. So if revenue comes down 32% and expenses go up 32%, what does that mean? And what is our cashflow look like in that scenario? This is so immensely critical because if you can’t say what’s the point. Yeah. Which we run out of money. If everything that goes wrong that could possibly go wrong, does go wrong.
You don’t have enough information and you’re still in the fantasy. So when you get into the Precursa platform, yeah. We’re going to see the sensitivity analysis. And, um, we started out talking about financing and I bring it back to this because this is how you build confidence. This is another data point that allows you to build confidence, to say, if we’re really, really wrong, and we’re on the bottom end of our sensitivity analysis, we’re still good on this. It’s still worth it on this raise for this amount of equity. And if you don’t know that stuff, then you don’t know if you’re asking for enough money. You don’t know when you run out of money, you don’t know what your cash flow looks like. Now. I’m not saying that in order to build a startup, you have to have a degree in finance. I don’t have a degree in finance, but I’ve also been doing business finance for over 25 years. You have to know about a little bit about everything in your business. That doesn’t mean you’re the expert on it. You should be hiring people who are a lot smarter than you for the areas that are like business critical go, right. This may be one of those, but you, as the ideator, as the founder, as the person who is out there in the world, who’s the face of your thing. You need to be able to speak to this intelligently enough, that you can show that you get it, and that you actually have confidence in the direction that your company is going. And what you say you can deliver on and promises you make. Because if you’re out making promises, I’m reminded of the whole Fyre Festival debacle, right? The guy who created that whole thing, he’s out there selling all this awesome stuff. And he’s got models and photos on these gorgeous beaches and yachts and all this stuff. Now he probably didn’t actually care about executing on any of that. Cause it seems like he’s been involved in a lot of fraudulent stuff, if you watch the documentary on Netflix, but he didn’t have enough relationship to the rest of his team. If you watch the documentary, they were so strung out. They were so stressed. You could see it even, it was like PTSD for them even talking about what it was like during those days, because what he was selling, and what they actually had the ability to execute on, were nowhere in the same universe as each other. You don’t want to be that guy or gal. Like you don’t want that to be your experience. So the sensitivity analysis matters, understanding the pro forma matters. And all of that stuff comes from talking to you people and getting real data, which is the thing that we’ve focused on the last couple of weeks. And we’re going to go more into that in the next episode, we’re going to talk about bias. How do you get the bias out? How do you talk to people and understand what you’re hearing from them? How do you analyze all of the data basically so that you can get good answers to your questions and you can build a good performance. You could build a good pitch deck and you know, what your MVP is supposed to be. Okay. So we’re going to talk about all of that next time. This week, the takeaways are, we’re super excited. The website’s up, we’re about to have all of our initial blog content launch. We’re really excited about that. The first few episodes of the podcast are going to launch here in the next couple of weeks. So we’re going to have people along for the ride, which is so great. And we’re about to start advertising. We have forecasted based on no outside funding through June, basically. And in that timeframe, we’ll spend close to $65,000 all in, right? That includes the probably 15 or 20,000 we’ve already spent. Plus the new ad spend, plus all the work for content stuff, all the podcast, hosting and production and all that kind of stuff. So we’ll probably be somewhere in the neighborhood of 60 to $65,000 in, and we have that money. It’s set aside, it’s in the budgets of our own companies to be able to continue to bootstrap that that is what gives us the ability to be confident and to weather these things that go wrong without going crazy. Because if we were really dependent on, if all of our plans were dependent on that money having come through, we’d be screwed right now. And we’d be frustrated, we’d be stressed out and we’d be like, scrambling. We’re not doing any of that. We’re still moving forward with our plan because we have other methods of funding it because we know exactly what that looks like. Okay. So it was a really exciting week. This is literally the inside look at what does it look like building a startup? Does that mean that yours will absolutely look like this? No, yours can look very different and that’s perfectly acceptable. Like probably it should look a little bit different, but this is our journey and the whole purpose, like I said, we’ve said it a million times before is we want you to see what it really looks like. I don’t want you living in the fantasy of overnight success and a billion dollar unicorn. I’m putting that in quotes too. Cause that’s not even real. I don’t want you to living in the fantasy. I want you to be able to turn your idea into something real into something that makes an impact into something that delivers on the promise and the vision that you have in creating it. I want to add one thing, because I did have a question from someone we were talking about this earlier this week, he said to me, well, you know, that sounds super lofty and really great. And I guess if you were, you know, designing something that was like changing an industry or changing a business and he’s like, but I want to design a game. Like I have this idea for an app. That’s like a, that would be really cool. Okay, great. Like what problem are you solving? Entertainment is a massive problem to solve because we are humans who have an ever decreasing attention span. There’s a reason why there’s millions of games in the app store and why people play many of them all at the same time, because we get bored because our attention wanders, because we have so much input all the time that it takes more and more of that input to continue to stimulate us. And I don’t know about you all, but during a global pandemic, entertainment became really important. And being able to do it from within your own house became really important, but that doesn’t change when we start being able to go out and hang out with each other and see movies again and do all the outside things. There’s still a place for people have downtime. People want to be entertained. So don’t view when I’m asking, what’s the problem you’re solving and you say, Oh, well, I’m building a game. That’s not a problem. It is a problem. Is there a hole in the gaming market that your game speaks to a particular type of entertainment or a particular type of brain stimulation or a particular type of personality who likes something that’s different than what’s generally available? That’s why candy crush is different from Sudoku is different. Like there’s just all different levels of it. So when we talk about the problem you’re solving, don’t assume that it has to be some big weighty thing. Most of the successes are actually small problems with really amazingly effective solutions. Okay. So I just, I wanted to tack that on because I did get that question this week. We’ll talk more about this kind of stuff as we go, but, but I did want to address it. So this is the journey. This is precursor the startup journey. Subscribe wherever you listen to podcasts, we are so, so excited to be on this journey. We’re excited to have you along. This is as transparent, honest as it gets, I think, folks. I am Cynthia Del’Aria. I am signing off, and I will see you guys 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…