At StudioHub's webinar series, we had the pleasure of hosting Brent Freeman - a US-based serial entrepreneur passionate about building businesses to generate both profits & social impact. To drop some numbers: at Stealth Venture Labs, where Brent is the Founder & President, he and his team have generated over $500M in revenue for its clients in the last five years. For those who did not attend the webinar: you have no doubt missed a lot, but in particular, you missed five keys to building a successful product or service. To make up for it, we share some key insights to find the right doors for your successful entry into the market. Startup Studios are unique for their fast MVP validation process. This process is critical for building ventures that make things happen as rapidly as five weeks: the timeframe our guest speaker suggests for a successful market launch.
To create a successful market launch, be sure to consider these 5 criteria:
- Passionate interest group - bond with your potential customers!
- Large target market - make it for scalable space!
- Disruptive value proposition - how and which extraordinary value do you deliver?
- Compelling market economics - consider your P&L and make sure to Gain!
- Solving market pain - is it a must-have or a nice-to-have?
The approach is based on the simple criteria one has to consider while Tailoring successful products for the perfect Market Fit. And as any exclusive Tailor, you need to consider basics like size, material, and style - nothing extraordinary: take your measurements carefully. The customer will order suits only from you. Few valuable insights from Brent's exclusive Market Fit Tailoring methodology:
#1: Passionate Audience
- Use algorithm-driven online platforms such as Instagram or Facebook to verify the existence of a passionate audience.
- Rule of thumb: Choose engaged audiences, e.g. ten to twenty million US-based Facebook users (in case your product targets US markets).
- Bonus tip: identify the right subsegments (yoga followers, golf players, pasta-loving Italian grandparents, and many others). Be attentive, not only creative.
#2: Scale Potential
- You cannot have a limited market and hope for greater returns: geometric progression does not work in this math.
- Have a large Total Addressable Market (TAM) as the sales funnel is narrowing down during the conversion from awareness to purchase.
#3: Unique Product
- Options: either disrupt a market with your product or reinvent an existing business model.
- Ideally: establish a disruptive price business and supply chain.
- Special secret: creating a disruptive product comes down to your supply chain. It is not a secret that this is the secret: digital marketing is just the vehicle to sell your product and not the key to success.
#4: Compelling Economics
Be on top of your economics:
- Your Product & Loss Statement (P&L) is everything. Understand your unit economics.
- What is your Net Margin? Determine the lowest price point, and use discount rates based on unit economics.
#5: Solve a Market Pain
Best value proposition - tick one or more:
- Convenient (on top of solving physical needs)
- Saves money
- Saves time
Few other recommendations
MVP Testing and Product Market Fit
- Create an authentic fake brand on a widely used e-commerce platform (e.g. Shopify) to test your MVP
- You found Product-Market Fit if you met your P&L expectations - congratulations!
- Lesson learned: there is a difference between persistence and idiocy. Use data, listen to the market, and pivot if needed.
- Studio positioning depends on available resources (funding, core team). Be sure to have expertise in at least one area (e.g. consumer) with limited resources.
- Overcoming our own biases is the hardest. Listen to your market and make the question binary: is it yes or no? The grey zone in between is a no!
- Be prepared for the answer. If it is a no, what does it mean? How easy is it to pivot?
Now we think you are ready: take the needle and the thread and go AHEAD!
About Brent Freeman
Being extensively involved in the past and also currently in digital marketing and e-commerce Brent is also an angel investor, former venture capitalist and expert author for Entrepreneur and INC on startup life. He is the Founder & President at Stealth Venture Labs, an elite growth marketing firm focused on helping e-commerce brands scale through growth plateaus that have generated over $500M in revenue for its clients in the last 5 years.