failI hadn’t expected to ever write a post like this but my last year in particular has convinced me it’d be worthwhile.

I’m going to start off by telling you a story – it’s about my neighborhood and it’s about sushi restaurants (Wait! Don’t go! It has a point, I promise!)

I live in a respected area of Toronto, near the corner of super busy Street A and fairly busy Street B. This intersection has a number of amenities that naturally include restaurants. There are quite a number. They all seem to do OK business although only a handful tend to be consistently busy.

Included in this mix is large sushi restaurant #1 on Street A. Prices are on the high side of moderate, it’s a big chain and has decent décor. Close to me on Street B is sushi restaurant #2 which was the first in the area. It has a traditional intimate Japanese vibe which can also be considered by some to be a bit dated. Prices are reasonable and service is good.

Last year a business closed down, an art supplies store, literally two doors away from restaurant #2 (you already know where this is going, don’t you?). Six weeks later a sushi restaurant opens, #3. It featured upscale pricing and décor. I happened to meet the owner soon after they opened when he was standing outside doing some cleaning. I asked him what made him open a sushi restaurant in this neighborhood. He told me he loves sushi and is good at making it and the rent was reasonable so he was living his dream of opening his own restaurant. “OK…but….you already have two other restaurants in the area that aren’t full. How do you expect to do well?”, I asked. He looked at me a little blankly and in a very unaffected way shrugged his shoulders and said “Maybe they’ll like my sushi better. And I’ll do some marketing.” About a month later he installed a sandwich board on the sidewalk promoting his discounted / high-priced sushi. Three months later the restaurant closed.

We all know the stat that over half of all restaurants opened go out of business within the first couple of years. Based on the above we can see why. Yet, regardless of whether it’s a sushi restaurant, an app or a site, I have come to realize that founders of all sorts tend to make the same mistakes in the most fundamental ways which causes them to fail…and they fail hard.

No, digital products are not the same as restaurants. Restaurants have significant costs of entry and are difficult to pivot into another proposition. Apps and sites are real easy to upload; with only a little passion, a few bucks and a friend who can code you can launch a business and call yourself Prez. What usually ensues is a lot of furtive head scratching as you reach out for advice on how to now make it go.

This is a slightly backwards yet seemingly-common paradigm for launching a digital product. We are too often inspired or encouraged to launch some combination of what we’re passionate about what we can…and we tend to stop there. I stand by my post about the entrepreneur’s beautiful mind as the most beneficial asset to efficiently generate success. Those who do not yet have it often begin with this out-of-sorts approach and thus need much more guidance to move it along. I have met a number of such founders who have tons to offer, yet have miles to go.

We try to give our strategy some street cred by attaching an acronym, MVP or the Minimum Viable Product. I have recently written on the dark side of the MVP in part by suggesting we use it as a crutch to stop thinking through our business model. If you’re misguided at the outset you can only hope to right size your business before you run out of passion, patience or ultimately cash.

The elementary questions below also lie at the core of what investors will drill into the most should you have such aspirations. I regularly tell business associates that you sell people on the set up of your idea as much as you do the idea itself. The ‘why’ is just as important as the ‘what’. My advice below is to pause before dumping loads of energy into awareness-driving activity for the sake of going deep into why you are launching your app or site in the first place. My point is, even if you can turn it into something else later on, you don’t need to open a sushi restaurant if you can avoid it…and you’ll take a more direct path to profitable growth if you are able to provide clear and sensible answers to the following questions:

  1. They don’t understand the opportunity.

(I know, right? This is like the book of Genesis in the Bible. “In the beginning…”)

This is the motherhood question that broaches three essential sub-plots: who is your customer, what is the need you are trying to satisfy (or create!) and how powerful is that need?

Who is your customer?

Profiling your customer is mandatory; if you don’t, you will neither speak to them properly nor serve them well in the execution phase. This profile must be specific for if you’re not abundantly clear on who you are serving you are serving no one. Don’t be afraid to narrow your target as a byproduct of being specific; as a founder you want to develop the muscle of serving your constituents well before you expand your proposition. Facebook had visions of being one of the biggest media properties in all of creation, but it started out as a version of ‘hot or not’ for college students on select campuses.

One way we fail is by creating a site that is more general in nature. I recently shared some advice on a new content site that wanted to provide ‘general information on health and fitness’. Please understand that I’m trying to avoid sarcasm when I bluntly point out that people don’t typically scour the net searching for ‘general information’, so right out of the gate, there is practically no market for your product.

What is the need?

…which brings us to needs. When you profile your consumer, you must importantly include a psychographic profile. You should find yourself including words such as ‘…are looking for…’, ‘…are frustrated by…’, ‘…are unable to…’, or even ‘…could benefit from…’ if you are in fact creating a need with your invention.  Somehow you need to dimensionalize their situation in a way that identifies their life gaps as well as their emotions. Do this well and your site language and marketing campaigns will leave your customer with the intimate impression of a 1:1 conversation.

I recently read an article in the Harvard Business Review that was, yes, rather academic but makes a valid point: companies lose focus on what they call the job to be done. In their example, we become erroneously focused on providing a ¼ inch drill that we forget that the driving consumer need is to drill a ¼ inch hole. We become married to our solution and lose site of the consumer problem. This habit prevents us from objectively learning and pivoting where necessary.

In the video space specifically, google has aptly pointed out in this article why people cruise youtube. They get that all search and browsing activity has an underlying need. Even casual browsing is fed by the need to be inspired or entertained. Same thing applies to your app or site. Partly through my blog, I have been a part of the business networking/career development space and I continue to come across founders who base their entire business on concepts such as ‘connections’ or ‘peer help’.  These notions are simply a means to an end; no, we don’t innately desire more connections when we are already struggling to maintain personal relationships of all types (family, friends, partners…). We connect to get something – a job, information and insight are three of the biggies. Are people satisfied with just helping? Some probably are, but I would venture to say more would be up for helping with the right kind of positive feedback…or the expectation of a returned favor. Push yourself to find the end point, and then think about how you can best facilitate this benefit. Do this while finding a balance between creating outcomes and preserving an organic experience. It’s a fine line.

How powerful is the need?

This is the one no.body.talks.about…or hardly thinks about…but matters a ton. It’s quite the subjective thing but makes a massive difference in your results.

To witness a primitive form of this phenomenon just spend about five minutes scanning your Facebook feed (I realize these days that’s asking a lot). In time you’ll come across a heart-rendering photo and story that someone has shared or posted. The subject matters can be predicted – bullying, animal cruelty, lost children, hated celebrities – it’s a short list. But these posts with the accompanied ‘share if…’ CTA stimulate engagement from the audience with hardly a thought for they adeptly tap into deep-seeded feelings. The primary purpose of such posts is to collect shares and data for less altruistic purposes but the user chooses to overlook this as they react in almost Pavlovian style.

Products have the similar capacity to engage if they approach an issue that lies at the heart of consumer passions. Sadly, this is something that is hard to measure or predict. Your gut will tell you a lot, but at the very least, you’ll need to get out there and chat with people about the business opportunity or central need. Even casually, find potential customers and ask them about how much better their life could be if you met the need you planned to meet. See if people get excited about the possibility or simply tell you it sounds cool. You’ll get a sense if you’re on to something.

  1. They don’t drive satisfaction for their consumer  satisfaction

Now that you know precisely who your consumer is and what business you’re in, it’s time to make money. And we do that by not only engaging users but by more importantly satisfying them. Because, a satisfied consumer will visit more, engage more, spend more and share more.

Yet when I ask most founders how they go about satisfying their customer I mostly get blank stares and a long pause. I then take another route and ask if they even know if the consumer is satisfied. I tend to not hear much more beyond bounce rates. This is a major problem.

Satisfaction is the product of a straight forward equation. It’s all about how your content, layout and functionality are deployed to help the user fully address a very specific need. And the consumer has set the bar high to be fully satisfied. Smart phones and the internet have conspired to make instant gratification the gold standard, should an on-demand result be required at that moment.

So, if I join your networking app looking for a social media expert to hire, I’ll give you only a handful of swipes, taps and keystrokes to find me someone. And not just anyone…someone goooood. So now you tell me: how are you making this happen?

That’s the genius of what makes a decent product a winner. Satisfaction = engagement + positive user result. That positive result is a function of precision, efficiency and credibility. You’ll need to look way past bounce rates, repeat visits and page views to understand satisfaction. A comprehensive plan to study your consumer is your tool: it must extract qualitative and quantitative data; it must be online and offline; it must be done in massive sweeps as well as in small groups. If your team includes an experienced consumer or digital marketer, you’ll learn now to extract insights inexpensively. Be obsessed with your user as an essential element of MVP’s mandate to continuously learn. If you can get to the point of deeply understanding satisfaction, your business will hit a whole new trajectory.

  1. They don’t drive satisfaction better than everyone else

I bring this up because I’m not regularly hearing founders recognize their competition. I think their reasoning is that because their solution is differentiated (e.g. web vs app), they have somehow redefined their market to convince themselves they are an island. I’m not sure this is the belief – I’m still digging into this – but lately I’m noticing some hiccups here.

I have already warned in my MVP article that if you launch something with a simple interface, you have already alerted the competition to get moving; what’s worse, your more primitive solution could inspire others to join in the game and ultimately pass you. That’s one issue – so make sure you’re learning, evolving and pivoting quickly…and recognize you could pivot right into someone else’s kitchen. Keep your lens wide as you survey who you need to beat; it will serve you well over the long haul.

The reaction you’re aiming for is to ultimately have users blown away by the experience — so much so that they put their own rep on the line by talking you up…unprompted. More importantly, your objective is to be the first place users come to scratch the same itch in the future. If you haven’t risen to the top of their solution consideration set, your long term success is not guaranteed.

The game as I pointed out is a race to deliver consumer value…and you do that by not only serving your user, but by being the fastest/easiest/best at it. If you’re in a lucrative space and you’re not the ‘est’ at anything, you’re a sitting duck.


I think we can all agree that failure is not usually fatal, which explains all the articles out there that encourage it. Sad thing is, it can be fatal if you fail at the fundamentals of knowing your market and building your product or service to the highest of standards in the digital space.

The most common failures are characterized by operating in the reverse. Founders are prone to looking at their products with beer-goggles on; they fall in love with their product solution more than they do with the consumer or marketplace. Consequently, they can’t pivot, they forget to serve their consumer and/or they default to the wasteful practice of investing untold marketing resources to convince (plead, beg….) their consumer (or anyone!) to use the damn thing.

The journey to serve your user is a fun but challenging one. You have to know each type intimately and you have to condition yourself to understand that every ounce of betterment for the consumer’s sake requires a thousand ounces of investment of sweat equity in your platform. Yet, if you can train yourself to define markets, identify or create needs, profile consumers and then serve them with precision and ease, you have developed a grand skill that can make you among the elite of entrepreneurs. Your insight and experience in this area is what gets investors excited. Marketing, as I have often said, merely fulfills the destiny of the product as created; it’s the way you see opportunity and design solutions that will make you exceptional in how you drive growth.


This article on bravery in entrepreneurship has many lessons, one of which is that success happens outside of your comfort zones. I interpret it to mean that while pursuing your passions can keep your energy up it can potentially lead to myopic thinking and reluctance to make the difficult decisions.

On driving satisfaction. Lessons from Airbnb scaling up: ” it was better to have 100 people who loved us vs. 1M people who liked us. All movements grow this way.”

Tech accelerators are embracing what I have written to the extent that they are not filtering out founders who don’t have a more global perspective.

Best article I ever read on Medium from May 2016. It’s about the reverse marketing funnel. Forget paying to acquire more customers to dissatisfy and instead maximize satisfaction with the ones you have and THEY become your free marketing. (re: my points 2 and 3 in this post)