Ask HN: How to survive emotional rollercoaster & running out of money?
I've been working on a startup for over 2 years and have been expending ALL my time, energy and money into it for the past year. It's been a great ride and lots of fun, but recently I feel like I'm running out of passion, desire, motivation, and most of all confidence. I have been full of all of that up until 4-5 months ago and now I'm wondering if I'm just wasting my time.
Brief history: The product is an entertainment device with an accompanying website that will be leased to entertainment establishments. There's a physical gadget that had to be designed & built from the ground up. So it's not just a web project, there's lots of pieces to it.
When I tell people about it and especially when they use it, the response is always "this is one of the coolest things i've ever seen/heard of. you're going to be a millionaire." Sure, that's flattering and (used to be) validating...but they have no idea what they're talking about. You can't just snap your fingers and roll out a million units and expect people are going to sign contracts. In fact, I've been snapping my fingers, clapping my hands, running around, fine-tuning, re-thinking, testing, focus grouping, pitching, and alot more for 6 months. And guess what? I've only convinced 2 people to lease the thing... and at a price point so low that it will take me over a year to turn a profit.
This is why I'm losing my confidence and motivation. I spent so long on research & development and came up with a working prototype. Then I spent more time improving and making it legit along with filing a patent & trademark. Lots of time and money into this project... all out of my pocket and my personal life. I just sold my car and have enough money to cover about 2 more months of living. So now I can't spend any more money on my project.
There's glimmers of hope from time to time. I get calls from fairly high profile companies that are interested, but it's all been smoke for the most part. This is very frustrating, because the interest is there but these corporations are so bureaucratic and elusive. "Hey I saw your product and I really like it. I'm going to discuss it with the marketing team and get back to you." They never get back to me and never respond to phone calls or email. What gives? Thanks for the tease.
The bottom line is that no matter what product you have come up with, how cool anyone thinks it is, if a corporation doesn't know who you are, they don't care about you! They'll get back to you when they feel like it. And if you're trying to cold call them, forget about it.
So what's left for me is that there is some interest, but there's absolutely nothing I can do other than wait. And wait. And wait. And pursue another company to wait on. Or go door to door and get rejected because "it's really cool, but it's just not in the budget."
Then I fantasize "If a big order does come through, how the hell am I going to pay to get them manufactured? Who's going to handle support? Who's going to manage things? Oh crap, will the server be able to take the load? What if I get 100 of these out there and theres a bug or the website crashes? Is my revenue model completely wrong? Should I seek investors or partners? Who can figure out how to sell this thing? How am I going to come up with rent next month?"
Arrrrggghhhhh. Please help!
Thanks for listening! jtesp
20 comments
[ 2.8 ms ] story [ 52.7 ms ] threadBased on the information here you have a problem with: marketing/positioning and/or sales and/or product development. If you provide more specific details of the product, the market, your current business model, pricing and sales strategies then you might get some advice you can actually use rather than "hey man! don't give up!!1 you're a startup man! keep it up and stick with it!".
Ad agencies quite often also have splits between "above the line" and "below the line" campaigns. Traditionally they call their "below the line" departments Agency Name DIGITAL (for some reason). Basically "below the line" refers to any campaign that isn't print, radio or television. Things like bluetooth proxy marketing, SMS, trade promotions and competitions, that kind of thing and the below the line guys are always on the lookout for hot new tech that they can flog into their client base. Bluetooth proxy marketing never took off because there were problems that were embedded in the market (most people have bluetooth off or hidden and then iphones came out without bluetooth and really screwed the pooch) but that didn't stop a hell of a lot of marketing agencies selling in bluetooth proxy campaigns to some pretty major brands.
If your technology is actually good think how excited they'll be!
Also how big were the agencies you were targeting? And were they the "digital" agency or the "above the line" agency? You'll have more luck with agencies that already do trade promotions through SMS, Web and other "tech" solutions.
So maybe "ad agency" is the wrong word - you want marketing agencies and probably more specifically the ones calling themselves "digital marketing".
(warning: I'm from Australia, terminology may be different ... )
For example: a few years ago I got on the phone to sell some SMS services. I wanted to sell to real estate agencies, so I started calling them and asking to speak to the person in charge of marketing. I called around 20 RE agencies and got one actually talking for long enough that they said "We use WORLD FAMOUS AD AGENCY for all our SMS and MMS". So then I called WORLD FAMOUSE AD AGENCY (which is a global marketing/ad agency with both above and below the line services) and spoke to them, and they were sort of interested, like didn't blow me off immediately but as you said, kind of "run around", but one thing is they weren't interested in SMS, they were interested in MMS.
I called my SMS provider and asked if they could do MMS, they said no, but I should call LARGE SMS PROVIDER IN AUSTRALIA. So I called them and asked about MMS for WORLD FAMOUS AD AGENCY, but LARGE SMS PROVIDER actually gave me the full story: that WORLD FAMOUS AD AGENCY uses UNHEARD OF DIGITAL MARKETING AGENCY who use TINY TECHNICAL GATEWAY PROVIDER who use LARGE SMS PROVIDER. This was just an off-hand comment, so I called UNHEARD OF MARKETING AGENCY and pitched MMS to them at a price point I thought would be undercutting the competition.
I got a meeting with them, but they realised that I wasn't doing the MMS - I was using the same guys that the guys they use now were currently using - basically because I wasn't presenting technology I had created but technology they had already seen. We had a good laugh about it and I got some web/hosting work out of them.
Now I didn't end up selling them the MMS, or SMS but this was the level of marketing agency that would talk to a small, independent operator, and also that really explored every new available technology such as Bluetooth, SMS, MMS, Web, trade promotions etc. rather than huge ad agencies that are directly talking to the big brands. They generally hold a relationship with the big ad agency, then the big ad agency has the relationship with the brand.
Short story: just start smaller down the food chain. You'll find that big agencies are rarely doing all the work themselves - at some point it's always just a lonely dweeb sitting at home coding in his underpants.
2) Don't be overattached to your idea. You already broke the "fail cheap" rule by having an idea that involves hardware and a lot of development. If the idea doesn't work out, forget it (it's easier since you have a patent)
3) It seems you already learned a lot on how not to do one thing (and may have learned how to successfully do a lot of others). That experience is valuable.
Thanks
I don't have experience in selling to BigCo, but here are a few ideas for potential research avenues.
Maybe there's a different way to "get to the right people" (which seems to be a big issue), or maybe there's a way to leverage the product itself to generate hype & interest from the actual users and have that spill over into a more convincing pitch.
Maybe a "magic little feature" is waiting to be added that would change perceptions at the corporate level. Or maybe the pretensions of interest they show at present are just sniffing around for a potential threat, acquisition, or knockoff IP, and you actually need to try for a different path into the market to get anywhere - even if it's well off the "beaten track."
There are more than a few stories where startup manufacturers end up going outside their area of focus and have to fund a complete vertical to the end-user, because other techniques failed and that was the only way to market the product. Which, of course, would lead to seeking investment.
I've been there a few times, though I had some previous use cases as tools in my selling bag so it was a little easier. If there's one thing I've learned from my years of selling it's to keep firing until something hits. Keep taking shots and don't stop, eventually someone will listen to you (Sometimes it's just because you won't go away) and that's when you can really start communicating. It's really hard, though (For me, anyway, and I've had some good successes but it still feels like some other guys make it look easy). Like entrepreneurship most people are not built for sales.
I can't give any advice on your life situation and whether or not it actually is time to stop or not. My default position is set to 'Never give up'. If you're having trouble getting through to someone inside a prospect company, jump to the top of the chain - I've called/e-mailed CEOs on more than one occasion when the right person to talk to was someone in middle-management, all that ends up happening is they take my call and pass me down to the person who makes the decision. Once you've been passed down you're much more important to the person you're talking to than if you've been working your way up the chain (Sometimes that works, too).
At a quick glance it looks like a sales problem, though. Keep firing. The first big sale is a huge adrenaline rush, especially after walking through the Valley of Death.
Sometimes very creatively. First, try the easy path and call the office and ask the receptionist to pass you through. They're VERY skilled at telling you to go away nicely so be polite and get your pitch down to one line to answer this question:
"What is this regarding?"
"I'd like to talk to them about XYZ"
You'll probably be told to take a hike, or "He's busy, I'll pass along your message." and you'll never hear from them. But sometimes you get through so always start there.
When/if that doesn't work, guess at their e-mail address. This is actually my personal favourite which I've used successfully - Trade secrets! - and send them an e-mail that explains what you'd like to talk to them about and gives a time that you'll call (Offer them an opportunity to suggest a different time) and make sure you call at the time you specified. Eventually you'll get the address right and you probably won't get a reply but it's crucial that you call at the time you said you would.
Then all you have to do is call at that time. You'll reach the receptionist again and now you have a perfectly acceptable answer to the question "Is he expecting your call?". You can say: "Yes, I was in touch with him last week and said I'd follow up with him today at this time."
That's all they need to hear and they'll put you through to them. That'll get you in the door, the rest of the selling process still applies. Keep going, never give up, you'll win eventually. :)
Figure out what works for your personality and what you feel comfortable with and go with that. Everyone is different and some sales people I know call more frequently than I do (Or could with my style) and have found ways to not cross the annoying line.
Just keep at 'er. I like to think of sales as an art of the persistent. It can be a lot of fun and intensely frustrating all at the same time! A lot like programming... hmmm... maybe that's just me.