I have a feeling that 2009 will actually be a boom year for internet start-ups. All those guys with redundancy cheques, hours and hours of free time and some half-chewed idea are going to be on the hotline to every web design company within an hour’s drive, trying to realise a vision they had when they were a middle-ranking manager at a carpet warehouse.
Feel free to cut out ‘n’ keep any of the following observations.
- If what you’ve got is basically a directory: forget about it
Face it. Yell.com – a business with a million years experience in directories is dying a terrible death of dying. Google Maps, inumerable customer review sites and any number of blogs, social networking sites and recommendation engines have made the very idea of a business listing seem clumsy and anachronistic.If your business model relies on you charging businesses a fee to be listed on your website then you’ve got to explain why they wouldn’t be better spending that money on direct search advertising through PPC. And those you do persuade won’t be very happy unless you deliver results. You need a really clever niche and unique review system to have even a ghost of a chance. - Today’s sales figure mean nothing
If you’ve got a start up with a limited marketing budget, you’re going to have very few visitors and consequently very few conversions. That makes statistical analysis virtually worthless. 6 sales on Wednesday, 1 sale on Thursday and 4 on Friday maketh not a trendline. Understandably you’ll be anxious about how things are going but until you’ve got aggregated data from thousands of visitors and hundreds of sale at least you are very likely to be drawing conclusions that the data doesn’t support.
- Getting your website designed/built should not use 90% of your available capital
The hardest lesson learnt by so many start-ups is that a website is only a means to an end. That £10,000 redundancy cheque will undoubtably buy you a nice website. Meanwhile the £2000 website with £8000′s worth of PPC traffic is doing actual business. I just bought my (very seventies!) light fitting from a company with a dogshit, templated website that maybe cost £1500 (unless they were getting ripped off). Plunging all your money into the best-darn-looking -light-fitting-website-on-the-net won’t result in a single sale unless you’ve got money to buy traffic. Make product, price and service your focus in the initial months and buy traffic to make it all viable. Then think about glossy redesigns when you’ve got some equity in your brand.
- If it is any way applicable at all, start local
You’ve got £5k and an idea. No contacts. You know nothing about the internet and you’ve never run your own business before. From such small acorns, many an internet behemoth has been born but most of them are, alas, stillborn. How you can build capital and a working knowledge of your market? Starting local is often a good idea. Local media coverage is easier to attain and local contacts are easier to make. In the early days you’re going to need advocates for your idea to help get traction. With a small but dedicated user base and a strong idea you’ve got something that can spread organically into other areas by word of mouth alone. That’s a lot more scaleable than gunning for a page lead in The Times with a £200 PR budget.
- Patience is a requirement: not a virtue
If you’ve got family or friends (i.e. a life) and something else like a regular job then your every waking hour is going to be consumed by your website and something will have to give. Even if you have all the time in the world, ideas only gain traction through gradual acretion. If you’re lucky, your idea will reach a tipping point and see an explosion in take-up, but otherwise you’ll need weeks… months… years… to see whether you’ve got something worthwhile.
- Think about saving your money for something more important. Like your mortgage
The entreprenerial impulse is what’s taken us from the caves to IKEA, but for every success there’s dozens of failures. Do your homework before you take the plunge. If there’s lots of equivalent sites out there just accept that your idea isn’t unique and that without a big promotional angle or budget you’ll just be a bit player in the market. There’s maybe not even anything wrong with that, but if you’re looking for something life changing then spend your money on airline tickets and a trip to a Thai whorehouse. In the worst case, you might be risking your hairline.