How Risk-Averse Entrepreneurs Succeed: Low-Cost Testing Using Reddit, PayPal, In-Person Pressure, and More

127 Comments

Entrepreneurs are risk-takers… or so the story goes.

In my experience, nothing could be further from the truth. Over the last 13 years in Silicon Valley, I’ve found that the homerun hitters are precisely the opposite: risk-averse. They mitigate downside whenever possible with low-cost and short-term testing. They’re often extremely ambitious and aggressive (e.g. Travis Kalanick of Uber or Elon Musk), but they aren’t remotely haphazard.

They’re methodical, and this is a learned trait.

The above video is a conversation between me, several first-time entrepreneurs, and Noah Kagan, CEO of AppSumo.com. In this video, Noah — who was an early employee at Facebook and Mint.com — covers his risk-minimizing methodologies:

In the first 20 minutes:
– His career path, including failures.
– How he has used low-cost testing in his own ventures.
– Why focusing on the small things (even trivial things) is a big thing.
– Common mistakes and coping mechanisms of first-time founders (e.g. seeking multiple co-founders).

In the second 40 minutes:
– Live critiques (in some cases, constructive tear-downs) of real companies and entrepreneurs.
– How entrepreneurs can make the jump from theory to revenue… in real-time.
– How you can immediately stop “playing business” without customer contact.

If you’re going to skip any part, skip the first 20 minutes. Though I enjoyed every minute, the last 40 minutes are especially must-see.

For more from Noah, be sure to check out his previous how-to posts on this blog, as well as his free upcoming course (9/26/13) on creativeLIVE: How to Overcome Fear and Get What You Want.

QUESTION OF THE DAY: What tools or services have you found most valuable for low-cost business validation? Any other tricks?

Posted on: August 8, 2013.

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127 comments on “How Risk-Averse Entrepreneurs Succeed: Low-Cost Testing Using Reddit, PayPal, In-Person Pressure, and More

  1. This reminds me, having a beer with you is on my bucket list too, and when I get out to your part of the country I’m gonna make it happen!

    Like

  2. This article is right on time for me as I venture into the realm of “constant contact”. In the past I paid for advertising in newspapers but now I am up-ing my social media presence and writing to get my message out. I am very limited in funds lately and want to maximize my reach to my target audience. I am a big fan of the 4HWW and am aiming to make that my business model for a flexible and fulfilling career and lifestyle. Thanks for this info.

    Like

  3. What’s the lowest amount some of these companies are seeking from a VC or Angel?
    If you ask for too little will they not take you serious and is that the same in each market ie. Silicon Valley vs. NYC

    Like

  4. YES! I’ve been waiting for a post like this! You’ve inspired me to test everything.

    Tim I’d do about anything to study under you personally. If you see this comment, try me. Give me any challenge and I’ll do it if it means securing your mentorship.

    Like

  5. Noah is a great guy and has an excellent head on his shoulders. One of the best parts of the interview is the part about the toothbrush. In about 5 minutes Noah completely changes the toothbrush developer’s (you just need to watch it…) marketing plan into something much more effective.

    Excellent value–thanks for sharing Tim!

    Like

      • Just wanted to say, Tim, that on top of this entire CreativeLIVE session having value, and this section with Noah Kagan specifically;

        The part 21min in, where you diffuse the tension, and really enable the conversation has stuck with me since then, that same language serving well in dozens of similar situations.

        Sometimes it’s the little aha moments; Thank you.

        Like

    • Sometimes you need somebody with an outsider perspective to show you the obvious. This was really a great job! I think you changed his complete business model within couple of minutes!

      Like

  6. You two are LIFESAVERS! Got my problem/solution, but was stuck on narrowing my market for a while. Thanks to you guys, I’m ready to scour reddit, find my niche market, and cater my idea to meet current needs & wants!

    Thanks, Tim & Noah!! Feeling amped!

    Like

  7. Tim this was SUPER helpful. I took away a lot of great things from this. I would love it if you did this type of thing more often. It was very enlightening and had a lot of very specific helpful details. Thanks!

    Like

  8. I loved the CreativeLIVE 3 day workshop. I’m glad I got the videos by purchasing 4HC. Who knew you could make a boring egg omelette taste so good just by adding a few extra ingredients.

    Like

  9. Wow this is incredible Tim, thank you. I didn’t realise I was a risk averse entrepreneur but after watching this I can see the similarities.

    My #1 tip for validating a business for no cost is simply ask a potential customer (who is also a stranger – asking family & friends doesn’t count for anything) IN PERSON if they would buy the product. I usually pitch them as if the product is ready to purchase right now. If they seem keen, then pursue the idea further, if not drop it.

    Just my 2c, I’m in the home cleaning industry for what it’s worth.

    Like

    • John

      Going to have to completely disagree with you, obviously in the most friendly of ways.

      1- Who wants to go walk around asking strangers if they’d buy things?

      2- Yes, your friends and family are biased. If you can’t get THEM to support you then why would others?

      Insert but “oh they like me so of course they’ll do it.”

      Then charge them more.

      The point is to start businesses that are easier for yourself, not ones where you have to go outside of your available network to start.

      3- Asking someone to buy is like assuming a girl giving you her # that means she’ll answer your call. ACTUALLY getting someones money is the truest sign of validating a business idea.

      Like

  10. I love the process of validate my designs. If i roll up my sleeve at the bar and the girl beside me asks where i got my USB bracelet, I know to make more of them. A couple years ago I strapped a bottle of wine to my bicycle and walked it around Montreal for an hour. I was stopped by several people to ask where to get such a wine holder. At the liquor store, all of the cashiers came to the window to look at it. I’d never had such validation for a prototype before. A couple days later it exploded on the internet and has now become my four hour work week. Thanks for your help!

    Like

  11. I have made interesting experience with internet marketing, i.e. promoting a certain product that I believe in as an affiliate.

    The good thing is that if there’s a certain buzz about the product you’re promoting and if the owner of the product takes care of marketing, one can make a decent income by setting up an info site around this product.

    Invaluable for me in this connection was also the personal connection to the owner of the product, i.e. one of the CEOs. This gave me a somewhat elevated position amongst the other affiliates.

    Setting up an info site for a certain product or service is quite a low cost approach to entrepreneurship. Not much risk involved, to be honest. That’s why I think my little ‘story’ fits to the post and your question: I am also risk averse, no doubt about that. I like ‘controlled risk’ much better, i.e. weighing the options and in this case setting up a couple of info websites around an existing product gave me the chance to earn an extra income next to my 9-5 job (with the intention to make it a business that can support a ‘4HWW’ lifestyle), while at the same time keeping the risk low.

    Best regards from Greece,
    David

    Like

  12. One of my favorite vids from you Tim, quite a few things in there moved me to action, particularly the form and sending it to friends, and also not worrying about scale and acquiring more immediate customers manually.

    Like

  13. Right after this interview Noah was in India and he organized a Meetup which unfortunately got cancelled but admire him as an entrepreneur and marketer.

    Like

  14. I remember seeing this on the Creative Live Course and just blitzing my cousin to come over to see it, just for this scene.

    The toothbrush validation is so badass.

    I’m currently on Noah’s How To Make Your 1st Dollar Course, and trust me. He knows his s**t.

    If your ready to take the leap, get it.

    Like

  15. Sorry to disagree… “Risk” like “failure” shouldn’t inspire “aversion”. Very specially for entrepreneurs, french word from the verb “entreprendre” antonym of being passive.

    Being methodical in testing, measuring, reajustments… absolutely yes, 100% agree.
    But risk a just a factor to measure specially in worse case, not more.

    For the very begining, nothing replace ability to emotionally vision of “things the way they could be and asking yourself why not?”.

    Some degree of narcissism, common sens and “good taste” is necessary for visions and starting.

    Starting, initiating, innovating (BTW synonyms of entreprendre in French) and investing brain, time, ressources… to study an opportunity, it’s already taking risk.

    For your question on business validation tricks, beyond “good taste” detail oriented, the “woow” factor of the idea (different of “hell yes”) and common sense, I love the idea of selling directly prototypes almost without profit margin if necessary.

    For example in case of the toothbrush project (where BTW I loved your observing the developer’s stress on hot seat, and the hug from Noah to relax the developper and slow down ;-) ), typically too soon going to the manufacturer unit price 28 cents with “false obligation” to order 40,000 toothbrush.

    Many manufacturers often accept with non viable price to make for example 20 prototypes at even $50/unit in process of going on high quantities.

    As long as its obvious final manufacturing price can be evaluated economically viable, that’s great to invest 20×50=$1000 to have 20 products ready to sell and collect feedbacks and often reajust the product.

    In a way, your testing group are paying instead of being paid to feedback, and marketing investment went to prototyping where it should belong.

    But before all that, at the very beginning, an emotional vision of how a thing should be, and working enough longtime and very hard to reach the “Woow” level is indispensable for an entrepreneur.
    That’s why many great entrepreneurs just developped their own needed product which couldn’t be found on the market.
    And why entrepreneurs still don’t come out of business schools or venture capital statistics and business validations.

    Nothing replace detail oriented “good taste” to anticipate what a group of persons will pay for.
    In the same way than good taste in dressing and color combinations, some have it rarely good and some even with all the money and design advisors don’t have it.

    Like

    • I am not quite clear what you are saying with this rambling.

      The key why real validation (actual customers / profit) is critical, is to save you time and money for building things people ACTUALLY want.

      Many people would say Apple and large companies would never validate and ONLY put out the sexiest products.

      Do you remember the iPod first gen?

      Like

      • Thanks for your answer Noah. I don’t disagree with your methods at all.
        Was writing about the association “risk aversion” and entrepreneurship.

        In 4HWW, you found:

        23 times the word excitement, or excited, exciting, etc…

        53 times the word “fear” (setting)

        47 times the word “comfort” (zone)

        And only 26 times the word “risk”, mostly to encourage it through Seneca approach, and not feeling “aversion” to.

        So I would be kind of sad if Tim having now a very longtime successful peer group, increasingly go to an investor language and approach, and less the very start of entrepreneur state of mind which was his in 2004-2007.

        Difference between building and maintaining wealth and the longer you’re surrounded by very already successful people influence the understanding of the very start of entrepreneur state of mind, and requirements to success at those very early steps.

        All business ownerships aren’t entrepreneurship.

        P.S. Sorry for my English (am French)

        Like

  16. Thanks for the great interview and the many insides. I recently read the book ‘Brains versus Capital’ of Guenter Faltin. Faltin goes even a little further. He emphasizes how important it is to create an excellent entrepreneurial design and to test the main assumptions as soon as possible.

    Like

  17. How do you protect your product while validating it? Does any anyone have a source for this information? I’m especially concerned about intellectual property.

    Like

    • Hey Mary

      That’s a common worry I’ve noticed people say to stop themselves from ever starting a business.

      There’s almost NEVER any idea that’s unique or won’t be copied.

      How many Japanese restaurants are in your town?

      For super complex algorithms, semi-conductors, etc.. you can still validate that your potential customers want that problem solved (and will pay for it) before you fundraise and spend the time making it.

      Like

      • Thank you, Noah! I am truly concerned about it – what if I promote my idea and a someone with better resources cops the idea and is able to stand it up
        and sell it before I am? I think this concern also stems from a dearth of information on my part which I am actively working to rectify. I’m really starting at ground zero – I have no tech experience (which is part of why I think my idea is huge – it’s a whole new adaptive use of technology for “live-better”-minded people) so i’m picking up the basic language of tech/apps while figuring out how to create and launch the project. I’m already more knowledgable today then I was yesterday. I want to be confident that I’ve done everything I can to prevent idea theft before validating. Any concrete ideas on that? Can you patent an app or platform(intellectual property) before it is either? Thank you for addressing my concern!

        Like

  18. Tim & Noah,

    One big Thank You! Very much appreciate you giving back and making the process real. For some reason we get in our heads that there’s a certain way that things are done and it cripples us and takes us to long to fail. Fail fast is one of the main take aways.

    Truly – Thank you

    Terry

    Like

  19. Noah is one of those guys who simply gets things done. I’ve followed AppSumo since they first started out and learned a ton just by watching them develop. Most of all – the evolution of their e-mail marketing strategy was what really opened my eyes – they’re now my favorite newsletter by far. And we as a start up have learned a lot from reading their posts / newsletter etc.

    One of the things I really like about his rapid prototyping / POF is to get out of the building and how he emphasizes that part as the key. My team and I have done basically the same day-in day-out and brought a really refreshing product to people who basically never heard of it before, not to mention early adopters who immediately jumped on the bandwagon. Best of all, none of them want to go back to their former favorite retailers (we’re in the apparel /lifestyle business).

    So if I had to summarize this CL session with one sentence… build it, try it, get the hell out of your comfort zone and tell people: “I’ve made this, what do you think?”

    Like

  20. Loved all of the 2 day CreativeLive videos! Answer to your Qn of the day:

    In TechStars they’re fond of the phrase ‘GFA’ – or ‘Get F*cking Aggressive’. A great example of this is from Nick (founder of LikeBright) who used Amazon’s ‘Mechanical Turk’ service to get survey responses from hundreds of people who helped validate his business hypotheses – and for hardly any cost at all. Nick reckons that this made all the difference and his commitment to getting real feedback was probably what scored him a coveted place in the Techstars program!

    Like

  21. Absolutely loved this video. It got me excited about entrepreneurship again. It got me excited enough to flip through some old posts and 4HWW again. It’s so good that more recent stuff doesn’t compare. As you’ve said yourself humans are suckers for a good story and the your BrainQuicken and 4H stories are by far the best entrepreneur stuff you have to offer.

    I can’t help but feel the well has dried a little, I’d venture to guess most of your fans are like me and know your stuff pretty well. We know the anecdotal stories by now and would love some new ones.

    Maybe a new startup isn’t for you right now but it would sure spice things up on here. Either way I’ll still be around.

    Like

  22. Great video Tim,

    I would love to add a couple of tips for idea validation and lead generation.

    I have an ecommerce store, selling a handful of high end home decor products. Now I started a tech company working in web development, custom software engineering, our own SAAS software and building an ecommerce platform.

    Being based in Egypt as a third world country forced me to take validation and lead gen pretty seriously. Here people are not that sophisticated in technology yet.

    So as an Example. When I decided to start an ecommerce website. Had different ideas ranging from shoes “zappos style” to car parts and home decor.
    Decided to test and validate with the following.

    1) Google “xxxx store” – “best xxx store” .. etc. [xxx is the products category]
    2) take the top result and google it with “xxx alternative” [xxx is the name of the top brand] This gives me the top competition
    3) Take each domain and go to quantcast. to look up what is the demographic who regularly visit this website. I focus mainly in gender, age, income. So I know who to target and how much they are willing to pay.
    I do this for the top brand and the rest of the competitors. Then write the demographic down.
    4) Go to keywordspy and search each top brand. KWS would give me a handful of the keywords they use in Google Adword, Also gives me the ad copy, Ad ROI, Their history and the estimated ad budget and cost per click. I document the top keywords and ad copies.
    5) Build a quick website to test the “buying decision”. I believe it is more powerful than merely asking for email if they are interested. People maybe interested when they don’t face a decision to buy. But you would hear a boatload of excuses when you push for the sale.
    > So I build a one page daily deals website and didn’t even buy a domain name. I build it as a sub domain. :)
    And I used a free and open source ready made drupal distribution called Open Deals. Google it “Drupal Open Deals” Sat it up and put the first product.
    I know the minimum quantity was 10 unites so I set a 10 unites to activate the deal. Sat up the payment system via 2co.
    6) using data from keywordspy I ran Adword campaign targeting the best keywords top brands were using with the best ad copies “borrowed” from the top brands :D and from my own creation.
    7) using quantcast data I ran a Facebook campaign with different photos and ad copies for split testing.
    Qs: Why I used Adwords and FB? I needed to know where my audience would be most responsive to my products so I can focus my marketing efforts in the future.

    Results: Home decor won. And I made a profit actually. I validated the idea, knew where my audience where and started to niche it down even more.

    Home decor has many, many sub niches from garden equipments to kitchen and lighting units … etc. Tested each one using sequence above and decided which one would be the most profitable by calculating profit margin and market size in comparison with competition.

    Once done. Build my e commerce store using Opencart “best open source eCommerce system” used a ready made theme for 50 USD. Bought some modules to enhance its functionalities. And I purchased a domain name.

    A) Sustained lead gen by writing buyer guides “optin required”, and every product was occupied by a detailed rich description “SEO boost”.
    B ) Joined venture with others selling related products to mine.
    C) Stayed in touch via email marketing.
    D) Ran crazy sales days. Sent coupons with my products so they can use it to repurchase from me or send it to a friend
    E) Made videos on how to properly use the products and take care of it and sent them with the products purchased.

    Hustled it out. And it turned our great :)

    Hope this helped a little. Thank you for your amazing content, insights and motivation.

    -Mohamed

    Like

  23. Tim mentioned a website at 28 minutes for testing landing pages, something like unbalance.com. It’s not unbalance or onbalance. Can someone post a link to the site he’s referring to?

    Do you have any other user/idea testing site links that would be useful?

    Like

  24. Hey Noah/Tim

    This is fantastic – but a question for you guys.

    I know Tim has mentioned that he throws a lot of spaghetti on the wall to see what sticks at times, albeit in a methodical way – how do you balance this approach with the validating one single method at a time?

    Thanks guys, plan to be on there someday.
    Jared

    Like

    • I encourage people to try 1 thing at a time for 48 hours and see if you can get 3 paying customers.

      The moment people get to the “aha” that people WANT what you’re offering is when you focus.

      Like the toothbrush example from the video above where people last night told me they emailed the guy to buy it…

      Like

  25. Also just want to say I have listened to The 4 hour work week (audiobook) several times and although i love your books and cant get enough of it them i struggle to find the motivation to follow through. I’m now doing the “how to make your first dollar” course through appsumo and am loving time limits and he kick in the ass I get if I’m taking too long!! (Parkinson’s law lol). Seeing both of you together just reinforces that I am doing the right thing and will be the owner of a successful low maintenance (4 hour lol) business soon. Can’t wait to catch up with you both (and other NR) soon for some tacos. Keep up the good work.
    Cheers,
    Michael Stark

    Like

    • That’s awesome Michael.

      I’ve been studying lately what’s separating the people in our course and in general that get the success they want.

      The most noticeable thing is the people that are willing to commit to the hard work.

      Like

  26. Hey, thanks for this post!
    Love watching you guys at work this is very motivating – you just get down to the point! Please post more of these.
    I read the 4HR WW a couple years ago and loved it, was completely going to revamp my whole world and was on the way but somewhere the motivation slowed down. Last week I picked it up again while relaxing on the beach/camping with my family for my 1 week summer vacy from my depressing job.
    SCREW THAT! haha – your book/posts got me going again thank you!

    Like

  27. Tim, great video. I have read countless books (including all yours) about starting ventures but none of them have ever addressed the ART market

    ART is my passion and true talent, and without sounding arrogant, i know my art has the quality to show in major galleries. The problem is, fame has little correlation to the quality of the art work and “making it” in the art world has not comprehensible path to success.

    I would love your take on how to penetrate the art market and in return I would be more than happy to provide you with a little art :)

    Brent

    Like

    • Hey Brent – that 1000 True Fans article Tim mentions addresses the art world a bit – http://kk.org/thetechnium/archives/2008/03/1000_true_fans.php

      It sounds like that’s a fantastic niché for you – maybe creating an info product to sell directed at art entrepreneurs. The amount of word play and puns you can do with “Start-Up” and “Art” is just awesome.

      I imagine Tim’s response is similar to the 4 Hour Chef – he has provided a framework that you take and tweak within the art market (or any other industry). I’d be interested to hear what the main difference is you see within your industry.

      Lastly – there are a few art start-ups in NYC you can look at: Artsy and 20X200, for example.

      Hopefully this helps.
      Best,
      JMH

      Like

      • Thanks for commenting Jared.

        I reread the 1000 true fans article and it really put things into perspective to create a sustainable living from art… the big problem i am facing is i am currently in my last year of dental school and approx 275,000 in debt. This would not be a huge problem but after reading Tim’s books (and others) i have my heart complete set on doing basically what you and Tim do.

        Ill keep you updated on progress i have, and someday soon i hope we cross paths in some foreign land

        Brent

        Like

  28. Great post as always, Tim you were spot on but I think you forgot to mention one thing. It seemed like these entrepreneurs lacked PASSION. Their demeanor just didn’t show me they believed in their products.

    Like

  29. I feel like a total shithead after watching this, and/or reading anything Noah ever puts out.

    Drifting through most days ‘playing business’ has become my life, and it is the most anxiety-producing, ineffectual, and painful things I’ve ever been through.

    Every day I wake up asking “WTF am I going to do now”.

    Perhaps after seeing this conversation I’ll focus on getting one customer today, rather than building up this intricate, grandiose plan.

    Like

  30. What happened to the toothbrush? I googled it and couldn’t find anything. Looked beautiful. I’d also pay $50 if the head could be replaced.

    But mainly, am just curious. It was fascinating to watch. He had been in it for so long that the wooden toothbrush did not seem special to him, while it was striking to see, even in a small video version.

    Any tips for how you get perspective on your own projects? To see them through the eyes of a newcomer.

    Like

    • Probably people in third world countries ate the toothbrush for breakfast. You know, it doesn’t make much sense to brush your teeth when you eat 5 times a week (true story by the way)

      Like

  31. I love this! I’m taking Noah’s “How To Make Your First Dollar” course at the moment (do it, it’s great). It’s so helpful to see Noah and Tim in action using the principles Noah talks about in the course.

    Like

  32. So, is he selling the wooden tooth brushes and donating the biodegradable one? I know he mentioned he wanted to make use of the final biodegradable model as well….

    Like

  33. Thanks for the great segment. How do you validate ideas nowadays since Adwords will ban you for life if you just use it to collect emails and Facebook is very discriminating on who it allows? Friends’ opinions are useful but can be biased and don’t accurately reflect the customer base for your product.

    Like

  34. This was a good one, I rarely allow myself the luxury of watching videos or even listening to podcasts but I saw this one come up in my Twitter feed and was sure it would be worth it, and it was! I like Noah Kagan’s balance of pragmatism and fun, and the way he just gets people moving forward.

    Like

  35. Hi Noah and Tim,

    Thanks for the amazing post. Watched video and read other post “How to make a million dollar business this weekend”.
    I had T-shirt design idea in my mind for a long time. After watching this video, I made a t-shirt design online in 5 minutes. Before sleeping, Uploaded the photo on my FB wall. Its been just 14 hours and I have 4 orders. Thanks a lot!
    I have no idea, how I am gonna find manufacturer and print those. Checking out that now. But got much needed push.
    Would like to seek more advise from you guys. Thanks.

    Like

  36. @Corey:

    A friend of mine created an iPhone app for a problem that exists and for which there are already (rather bad) apps in the App Store. So he set out to create a really nice looking and serious app. He spent about 3000 USD. End of the story: his app wasn’t approved!

    My point: While this story shouldn’t discourage anyone, it does tell me that the fact that there are already approved apps in the App Store, even if they are “bad”, doesn’t mean that an app will get approved.

    Best regards from Greece,
    David

    Like

    • Hey David

      That’s exactly the point where validation is key.

      What’s the ACTUAL problem your friends product was solving?

      NO customer wakes up wishing they had an app to do something. EVERY person wants a solution so focusing on that first and then to the medium is what will save you time and money…

      Like

      • I agree, Noah. And thanks for taking the time to answer.

        The issue here, in my friend’s case, was that there was already a market. Quick background:

        The app addresses a problem that women in Japan want to solve: when they are at a public washroom they don’t want to hear others when they are, well… doing their business… :) There are actual electronic devices being sold for that in Japan. So the app solution is a very logical one. And as I wrote: there were already some apps like this on the Appstore but rather low qualitiy ones. So he set out to make a really nice loooking one that takes the whole thing very serious. See here: http://www.ladysilence.com/

        As I said: he spent 2000 EUR on it for development. End of the story: Apple didn’t approve it, and everything seems ‘down the drain’.

        That’s said even for me to see, because this friend came up with that idea within a mastermind group we had formed where everyone comes up with his own idea and follows through on that. Although intended for the Japanese market, even I in Europe would heavily consider using this app, it just makes sense, in terms of privacy and in terms of saving water (because people don’t have to actually flush anymore in order not to be ‘overheard’ — kind of a funny subject, I know, but it is a very real issue).

        Best regards from Greece,
        David

        Like

  37. Great stuff!! Read the 4HW several times and loved it! Noah’s recommendation and advice compliment Tim’s content well. Can’t wait to get started!

    Like

  38. I loved this CreativeLive. I was so lucky to catch it and I learned so much interesting and applicable stuff. Your interaction with Seth Godin was like two friends catching up after years of time apart. Remarkable.

    Also, Noah’s take on marketing is right down my ally. I’m trying new stuff on my blog, and giveaways are making an impact. Now I have an idea of what people like, and what they don’t.

    Low-cost business validations: Mock-up page for a store, PayPal, and reddit. (Even before reading your previous post).

    Like

  39. In the wooden brush example – I checked up and it sounds like he sold 2 brushes, but that’s it, and he wrote on twitter that the idea was not validated. What else does he need to do to succeed?

    Like

    • He needed to keep selling. I believe he did at least 10 sales on air and more afterwards.

      He just gave up. Plain and simple.

      One of the most counter-intuitive thing I’ve noticed with wantrepreneurs is what happens when they actually taste success. It’s scary and they pull back when they need to push forward.

      Like

      • “One of the most counter-intuitive thing I’ve noticed with wantrepreneurs is what happens when they actually taste success. It’s scary and they pull back when they need to push forward.”

        Strong insight, I keep this one also. Sounds like “the inner thermostat that bound the success we allow ourself” as Gay Hendricks puts.

        Like

  40. Thank you, Noah! I am truly concerned about it – what if I promote my idea and a someone with better resources cops the idea and is able to stand it up
    and sell it before I am? I think this concern also stems from a dearth of information on my part which I am actively working to rectify. I’m really starting at ground zero – I have no tech experience (which is part of why I think my idea is huge – it’s a whole new adaptive use of technology for “live-better”-minded people) so i’m picking up the basic language of tech/apps while figuring out how to create and launch the project. I’m already more knowledgable today then I was yesterday. I want to be confident that I’ve done everything I can to prevent idea theft before validating. Any concrete ideas on that? Can you patent an app or platform(intellectual property) before it is either? Thank you for addressing my concern!

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    • Use your non-tech skills to your advantage.

      Ideas are free, execution is the hard part.

      You’ll never know everything. A common wantrepreneur problem. There’s no golden answer that’ll solve what you need.

      Worry less about the patent and more that people want what you’re trying to solve.

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  41. Amazing post. I am a huge fan of 4 hour concept and Noah Keagan and APP Sumo.

    Some time ago i actually had an idea that might get your attention Tim.

    All explained here.

    http://www.goolets.com/for-tim-ferris-biggest-challenge-of-his-life-500-000-usd-worth-of-pr-for-free/

    How you can get for 500.000 USD PR for free while saving the World Economy on an ultra luxury vessel with your friends?

    Please let me know if this would be interesting for you.

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  42. DO NOT USE PAYPAL!!!! My account was frozen recently, and then they froze my Brother’s account just for being a family member!!! This is not a joke. I have thoroughly researched this, and evidently PayPal is doing this to thousands of people and holding their funds for 180 days without offering any reasons why. They only tell you that they are investigating the account, and will get back to you when they have finished their investigation. Many of us feel that they are making interest off of our money. EBAY has fought in courts to state that they are not a “banking system,” and therefore do not have to abide by those laws. They are CROOKS! DO NOT USE PAYPAL! Sorry Tim, but I did believe in them once, but NEVER, EVER again.

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  43. I wish you guys would have talked about driving enough traffic TO YOUR IDEA to test it. Did I miss it or did you guys kinda mention the importance of testing but beyond using redditt what were your ideas for exposing the idea to enough people to test?

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  44. Very insightful talk guys. Thanks for sharing this. On the note of risk aversion are you familiar with Tony Williams’ book “The Science of Hitting”? It’s an enjoyable read about one of Baseball’s best hitters in itself, but equally well provides a vehicle for honing one’s decision process. Four Hour Chef style I guess :).

    Basically Williams broke his strike zone into 77 different sections, each the size of a Baseball, and would only strike those balls that would statistically allow him to get close to a .400 batting average. The difference between letting all the high-risk opportunities go and swinging hard at the great opportunities bought him his tickets to the Hall of Fame. So I guess the lesson is you have to be aware of you’re strike zone (area of competence, market need using Muse Math or as Noah put it: a specific problem someone has identified on a forum somewhere) and if you’re odds are good you can be confident enough to go for the homerun.

    Anyways, really appreciate the great content you share in your books and blog Tim! Currently finishing a PhD in Aero Enginnering and am also a national athlete in the Long Jump, so the 80/20 hacks have been really useful to keeping me sane :). Btw you also introduced me to Coach Ross, whose DL program was a big factor in boosting my PB to 7.80m in 2011. 25cm off London 2012 but hey we’ve just started incorporating some RKC workouts for pre-season training so maybe that’ll swing me to 2016 :).

    Liebe Grüße und Besten Dank,

    Rainer

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  45. Great stuff Tim and thanks for taking the time Noah, even though this video is over an our, as always Tim you cut to the chase and gave me the knowledge of hours worth of reading!.

    Should be the first viewing for anyone thinking getting their idea off the ground. Quite amusing discussion around moving on to the next idea before properly launching the last idea, something I’m sure all entrepreneurs need to control.

    Can you imagine the first chap sitting and talking about his idea to those two! Full credit and rightly pointed by Tim what a terrifying ordeal that would be. Tooth brushes who would have thought, launching that product (almost any product I guess) is full of hard work, long hours, set backs and heart break, he will minimize this with the advice provided. On a wider scale Tim this will be true for all of us.

    Good luck everyone :-)

    PS: Very funny watching Noah scalping toothbrushes to Tim… very funny $50 bucks just like that !

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  46. Awesome talk ! Lots of usefull advices I take and will use them now on my road to wantrepreneur redemption. Thanks Tim, Noah and the two guests for sharing.

    Tim and Noah mention tools to enforce self-discipline (self “kick ass”, you sure need a tool to do that ;) ) arround time 12mn30s. Can someone help me identifying what they are referring to ?

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  47. Great discussion on minimizing risk and working backwards from solving a problem to generate automated income. I have been getting more involved in generating income online I am hoping to gain feedback on a website I am working on. (positive and negative feedback would be helpful)

    I am working on a simple travel site that will quote the entire cost of a trip from start to finish and allow customers to book their trip. If anyone has advise for additional methods of validations I am open to suggestions.

    Thanks for sharing this helpful discussion!

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  48. Not exactly sure how I ended up here… I mean, love reading yer stuff Tim but I started out looking at an email detailing AppSumo’s recent beef jerky biz startup and clicked, clicked, clicked.

    The AppSumo story is AWESOME! Thanks for interviewing them. Agreed, second 40 minutes or so are packed with gems.

    I think I will try that 24 hour challenge myself. NOT shabby.

    Keep Stepping,

    Kurt

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  49. Yo Mr. Ferris I’m reading 4 hour work week and I just finished reading the section about low information diet. I am a high school student and everything about it embodies useless information. I already know what I’m going to do and it doesn’t involve a goddamn diploma. I’ve been contemplating about dropping out because I don’t learn anything practical and instead using that time to pursue my own passion. Give me some advice

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  50. Tim, I’m glad I didn’t take your advice and skip the first 20 minutes. That little nugget about how you researched for 4 Hour Chef was amazing! Its rare that I fill out an entire notecard that early into a video. You da man!

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