Three Things To Remember Before You Put Your Product Into The Market
One of the most complicated parts of a new business is preparing for the launch of your product.
You have a passionate cause, a great social enterprise idea and the support of funders, but there still remains one of the most complicated parts of a new business: putting a product into the market. Whether it's software, a service, or a physical good, the product is how consumers will identify your business- and, ultimately, it will determine your venture's success.
Michael Dearing, founder of Harrison Metal, invests in early-stage technology companies, helping them take products to market and create a thriving business. A former senior vice president and general merchandise manager for eBay.com, Dearing has worked with a wide variety of successful start-ups, such as Birchbox and Acompli. So what are three pivotal things social entrepreneurs should keep in mind as they get ready to put their best products forward? Dearing shared his insight with The Venture.
1. Everything is a prototype.
All too often, founders question and over-think every decision and detail as they prepare to launch a product. Fine-tuning is important, but once a product has been released, it doesn't mean it's finished, says Dearing. Always remember that everything is a prototype and a work in progress. "Look at the long history of products and companies you admire…they all started out in a lower resolution than what they evolved to," Dearing says. "There are no instances in which a product has emerged fully formed."
Taking note of how successful businesses have changed over the years may yield some helpful insight into how you'd like to develop your own work, while also providing some much-needed perspective.
2. Keep an open mind.
When developing your product, it is easy to get sucked into a single vision. In order to remain flexible and creative in your problem solving, it is important to observe and keep your mind open at all times.
"The very best founders and entrepreneurs are great ethnographers," says Dearing, referring to the sociological practice of gathering and documenting observations of people and cultures. "They're collecting without thinking, and then knitting together great ideas and solutions into their work."
Dearing also recommends understanding former Intel CEO Andy Grove's black box analogy as a way to evaluate your concept while developing your product. In the most basic terms, thinking of your business as a black box will help you sort out the input, labor and output. In other words, the black box will help you analyze your project's production process. "The black box is for your product development and for your product's impact on your users' life," says Dearing.
3. Don't forget the simple math.
It may seem counterintuitive for a socially driven business to focus on money, but it is necessary for any for-profit social enterprise to remember basic economics in order to survive.
"Social missions sometimes ignore the iron rule: Your perceived value should always be greater than your price, and your price should always be greater than your cost," Dearing says.
From the very beginning entrepreneurs are engaged in a struggle to turn their insight into a product, and are then tasked with turning that product into a viable business. Straying from the formula can cause problems further down the road, not only disrupting your project's economic health, but also your ability to make an impact.
Dearing puts it plainly: "It doesn't matter whether the company is for profit or for philanthropy- if you run out of cash, you die."
The Venture is a new global social enterprise initiative searching for extraordinary startups and new ideas that use business to create positive change. If you have a GCC-based social enterprise or an idea for a social enterprise, enter The Venture #WinTheRightWay to potentially win your share of US$1 million.