For years, I worked at building and selling software products through our agency with little success. This is how I used to characterize it to my friends:
It’s like driving through the desert to Las Vegas. You know you’re heading in the right direction, but you don’t know how far away it is. And the agency is like an anchor that you’re dragging behind you.
I remember telling this to another agency owner that was also building software and he said, “Oh my god, that’s exactly it.”
Today, I’m looking at building another small software product.
It’s been more than five years since I told my anchor in the desert analogy to someone.
What permeated my experience back then was a sense of ignorance: being in the desert and not knowing the distance.
How I think about it now is that you can’t put yourself in a situation of wandering the desert. Knowing that you’re moving in the right direction isn’t enough. You need navigational tools that can give you a sense of where you’re at.
When it comes to any initiative to grow your business, before you dive into the work involved, it’s critical to set yourself up to learn. That means considering feedback mechanisms as part of the process.
With this product we’re building, I have some sort of hypothesis that I need to make concrete. It goes something like, “If we can get x customers a month to consider it, we can convert y customers, at a rate of z, for an average purchase cost of w to make a monthly revenue of t.”
Each variable is an assumption that we can gather data on and measure against to tell us where we’re at.
As entrepreneurs, we generally operate in that wasteland of the unknown. One of your opportunities for growth is to make sense of the terrain by intentionally create feedback mechanisms to build intelligence.
What would tell you that you’re on the right track?
Featured image is view through the Temple of the Oracle of Amun. Alexander the Great traveled across the desert to the Siwa Oasis to consult the oracle here and establish his divine bloodline through prophesy. By Thom Chandler – Flickr used under CC BY-SA 2.0, https://commons.wikimedia.org/w/index.php?curid=3160158