The Hypothesis: Start Small, Think Big
Here’s a number that always stops people. In 1886, its very first year, Coca-Cola sold nine drinks a day. Not nine thousand. Nine. Today the company sells close to 25,000 drinks every second. Every giant you can name started out as somebody’s shaky little guess that they were willing to test.
I bring that up because I meet so many people who believe they can’t start a business unless they’re already an expert in it. I want to put that idea to rest today.
But first, one truth about why anybody buys anything. Every marketing message on earth pulls on one of three levers: your health and happiness, your wealth, or your relationships. Coca-Cola sells you happiness (that little sugar hit). Verizon sells you a better-run business. Insurance sells you the safety of your money. If you can’t say which of the three your product taps into, sort that out first.
Okay, now the fun part. To prove you don’t need to be an expert, I’m going to build a business in an industry I know almost nothing about. I love restaurants. I eat in them constantly. But I’ve never run one and wouldn’t know where to begin. Perfect. If I can pull this off, so can you in a field you actually know.
So let’s say I want to sell restaurants a booking tool. My starting bet is that it can lift their reservations by 50% and nudge the average check from, say, $50 up to $70 on the same table. Anyone who’s run the numbers on a restaurant knows that bump is enormous for the bottom line.
Is that bet any good? I don’t know yet, so I go find out, cheaply. I run a little survey (you would not believe what a $5 Starbucks card gets people to tell you), I walk into restaurants and ask, and I show up where owners gather, like the chamber of commerce or a Harlem CDC workshop. Then I dig into data that’s sitting there for free. New York City restaurants spend only about 2% of their revenue on technology, well under the US business average. Only 13% are chains, so I’m selling to independent, family-run spots, and the most common kitchens are Mexican, Chinese, Italian, American and Japanese. Ask owners what’s crushing them and you hear the same song every time: labor, rent, inflation, and falling alcohol sales. None of that took special expertise. It took an afternoon.
Then I look at who I’m up against, and not just the obvious folks. There are direct competitors doing what I do, indirect competitors solving the same headache a different way (the old cash register and a spreadsheet), and budget competitors who quietly eat the same 2% I’m fighting for. You have to watch all three.
And whatever you do, don’t launch big. Build the simplest possible version, get one restaurant to try it, turn them into a happy reference, and grow from there. Remember Coke’s nine drinks. Franklin Mars went bust with three candy companies before Mars became a $50 billion empire (that today makes most of its money from pet food, of all things). Uber began as a black-car service for a few blocks of San Francisco. Even “crowded” markets leave room: years after the iPhone landed, Apple and Samsung together still had only 38% of phones.
And small tests hand you gold. Poke around a few Mexican restaurants and you might learn they’d love software that flips between English and Spanish, something the big players ignore. You’d never find that in a spreadsheet, only by getting out there.
So that’s a real market, built from scratch by someone who couldn’t cook you dinner to save his life. But knowing a market exists isn’t enough. Next in this series we get uncomfortably specific about who it’s for, and why they’ll pay you again and again. That’s your ideal customer profile.