Starting a business, though often rewarding and worthwhile, is a big challenge. Entrepreneurs are bound to make a few mistakes in the beginning, and some of those business owners are willing to share the valuable lessons they've learned along the way. Rob Biederman, co-founder of business consulting website Hourly Nerd, is one such success story.
Biederman and his business partners previously shared their story with BusinessNewsDaily about how they started their MBA student-to-business-owner matching service. Since then, the company has taken off and is in the process of closing a deal with a high-profile tech company to help supply top workers in the field. We had the opportunity to follow up with Biederman and find out a few of the most important lessons he learned in the first 100 days of running Hourly Nerd:
- Know your target market and what you do for your customers. Many entrepreneurs set out to create a great product and worry about the market second. Designing your product to solve a specific need for a particular target market can prevent a lot of headaches. Particularly in the business-to-business channel, having a satisfactory solution that clearly attacks an unmet need is much more important than having a perfect solution to a need that doesn't exist or is already being met adequately.
- Launch a "good enough" Beta product, gather feedback and upgrade. The only way to figure out which aspects of your service are valuable and which are missing is to launch a minimum-viable-product (MVP) test, gather feedback and iterate. It's a tricky balance: Your initial product should be good enough to realistically represent its ultimate value proposition, but not fully baked enough that it takes too long or is difficult to alter. Hourly Nerd has succeeded through rapid prototyping — running with a site for about a month, collecting required upgrades and then rolling out a new version.
- Put your team in the right roles. Every business has a set of needs and a set of resources to address them. Team members will typically fall naturally into the roles that complement their skill sets. In certain cases, however, historical legacy, random chance or situational expediency will put team members in positions where they're unlikely to succeed. Recognizing this early and reallocating resources is critical. When no one on the team has a natural affinity for a required responsibility, go outside the company and hire, or find a strategic partner. Each person on your team has a special comparative advantage (or you shouldn't have him or her around). Make your team specialize, and forget the rest.
- Don't be cheap. Economizing has had disappointing results for Hourly Nerd, and it has held the business back. This doesn't mean you should spend wildly — just focus on the overall value, rather than on price. When you take a low-value, low-price option, you will spend more in the long run, either in time or dollars. Hourly Nerd spent $889 to build its first website, and it continues to constrain the business today. Spending 100 percent more on certain items can deliver much more than a 100 percent return.
- Remember to rest. Nearly all entrepreneurs — including the founders of Hourly Nerd — "accidentally" pull an all-nighter working on the business. Don't do that to yourself. Rest and recovery not only keep you charged to continue the following day, but they also give you perspective. We've found that a few hours off for relaxation, exercise or even just watching a movie can be more helpful for resolving a dilemma than continuing to stare at the white screen. The minute your startup stops being fun, put it down for as much as a day. When you miss it, it's time to come back.