4 business rules of David Jan
ABBYY founder told Forbes how a successful business is different from a failed one. We at LeadStartup fully agree with David Jan, so we want to share his interview.
I invest in those projects in which I personally participate in operations. I invest very little where I can not influence the internal processes. And yet - this is hardly an investment, rather a gift - I invest in Ayb's educational fund.
')
There is no definite answer to the question “What is the most profitable business area now?” If such a vein were known to all, then there would have been a lot of people there for a long time. Better talk about large-scale changes. They consist in artificial intelligence technologies that are being implemented in all areas of our lives.
And the most interesting thing happens at the junction of previously known needs of people and new technologies that satisfy this need. There was a delivery to couriers - it became delivery using self-propelled devices and robots. There were office services - automatic hiring assistants appeared. For example, a robot named Vera himself conducts initial interviews with candidates. There were doctors' conclusions - neural networks appeared that were able to determine the origin of the disease more accurately than cardiograms and tomograms.
With the advent of artificial intelligence, everything becomes upside down. Therefore, I would advise young entrepreneurs to develop a niche in which they will find 3 "magic crystals":
A person must know about the "disease", must make a pill from it, and must be able to deliver it to the patient. If an entrepreneur does not have a “dishonest” market advantage at these points, then it makes no sense to start a business. I met many people with whom I had approximately the following dialogue:
- (they) I developed a new video editing program!
- (i) What is your education? Camera operator? Directing? Why do you think your program will be better than existing ones?
- Such an education, I just tried other programs. And it seems to me that there are some inconveniences.
- Maybe you have special knowledge of image processing or video stream?
- In general, no, but I did this in my student days.
- Or maybe you know how to sell these programs?
- No, I have not thought about how to sell.
There is a lack of all three crystals on the face. Often people know how to create a pill. They are from the scientific community, they say that "all my life I was engaged in image processing." But this is not enough. They do not know the knowledge of the disease and the ability to deliver the pill to the patient.
Most startups go bankrupt even before breaking even, because they do not have a significant competitive advantage, understanding of the “disease” and distribution channels.
Closing a business project is a normal business process. This is not something extraordinary. According to statistics, only 1 project out of 10 survives. Therefore, closure is the most expected outcome. It hurts, but it's part of the life of an entrepreneur and startup.
In any circumstances, you need to maintain interpersonal relationships, because the trust of investors and colleagues will be extended by another project that you will do. With these employees you will go to another project. Separate in one project as efficiently and constructively as possible in order to move on in another.
I usually start a business with a crush. In the modern world there is a lot of information, people, ideas around. But suddenly a certain insight appears: “This is cool, no one has done this yet!”. Having many years of experience creating a business, I go with this to my wife. And according to her reaction, I understand that it is better not to take on 90% of ideas, because I have tried many times.
But falling in love alone is not enough. It is necessary immediately after the appearance of the idea to talk with people, get feedback from them. If you understand that it makes sense to implement an idea, then the next step is to create a paper prototype.
At this stage, there is no need to develop anything, to invest nowhere. You just need to imagine that the product already exists. Write an ad to him, possibly make a landing. Try to sell it to future buyers. To someone to sit right on the bench. Would this person buy your product right now? Let him rate it on a 10-point scale. This is called the Net Promoter Score (NPS).
Then calculate how many people will give you 9 or 10 points. If out of 15 respondents no one rates it at 9-10, then it makes no sense to do this. A rating of 7 or 8 means that people are just polite, but they will not buy your product. This is the most important practical experience that I have received. In Silicon Valley, it's called "Fake it, then make it."
Beginning entrepreneurs for a long time come to the idea that if you just ask a person, you can get a huge amount of insights and understanding of the problem. If 20-30% of respondents put the idea of ​​9 or 10, then this is a very serious signal that you have found something.
Make Decisions When You Don't Have Product-Market Fit Yet. This is an important concept in startups. Find your niche, your consumer, sales channels. As a rule, this does not work at the beginning. It is extremely rare for a startup to reach breakeven on the idea for which it raised money. In the search process, he makes several Pivot's - major changes to the product concept.
Before the money runs out, you need to make enough Pivot to find your client. If you have one or two years left, then you need to make 4-5 such “turns”. For each of them you have 2-3 months. We need to come up with another hypothesis and start testing it using a paper prototype. If everything goes well - make a real prototype, try selling it. Even if MVP is on sale, this is a good sign. Sell ​​on.
If the MVP is not gaining a sufficient number of nines-ten - take the next turn. With this method, the "Valley of Death" stage is performed. If during this time it is possible to find a growth point, users appear in the product, then you can scale.
Saibiko is the world's first handheld communication computer, the predecessor of Tinder, WhatsApp. This is a box where you enter information about yourself and the girl of your dreams. She vibrates when she finds such a girl at a distance of 150 meters. Then you contact her by writing a message and make an appointment.
We came up with this thing in 1998. We developed everything from scratch: there was no cellular communication and Bluetooth yet. This idea turned out to be so popular that in 4 months in 2000 we sold 250 thousand units (sold in the USA). We were even recognized on the streets of New York.
But there was a Nasdakov crisis. We tried to modernize the company, entered the European market. Then there was a famous attack. Wireless communication with unknown people has become a forbidden story for teens. The crisis continued for several more years. And we got into this meat grinder quite by accident.
There is obstinacy, but persistence. Stubbornness is what leads a business to collapse. Perseverance is what brings success. Finding a fine line between them, as you know, is extremely difficult. But this is the art of the entrepreneur. The only thing that can help with this is constant communication with your users. Need to absorb feedback like a sponge. Try to understand their point of view. Only such experience helps in quickly finding the difference between perseverance and stubbornness.
Link to video
1. Competent investment
I invest in those projects in which I personally participate in operations. I invest very little where I can not influence the internal processes. And yet - this is hardly an investment, rather a gift - I invest in Ayb's educational fund.
')
There is no definite answer to the question “What is the most profitable business area now?” If such a vein were known to all, then there would have been a lot of people there for a long time. Better talk about large-scale changes. They consist in artificial intelligence technologies that are being implemented in all areas of our lives.
And the most interesting thing happens at the junction of previously known needs of people and new technologies that satisfy this need. There was a delivery to couriers - it became delivery using self-propelled devices and robots. There were office services - automatic hiring assistants appeared. For example, a robot named Vera himself conducts initial interviews with candidates. There were doctors' conclusions - neural networks appeared that were able to determine the origin of the disease more accurately than cardiograms and tomograms.
With the advent of artificial intelligence, everything becomes upside down. Therefore, I would advise young entrepreneurs to develop a niche in which they will find 3 "magic crystals":
- Knowledge of the problem;
- Knowledge of technology;
- Knowledge of distribution channels.
A person must know about the "disease", must make a pill from it, and must be able to deliver it to the patient. If an entrepreneur does not have a “dishonest” market advantage at these points, then it makes no sense to start a business. I met many people with whom I had approximately the following dialogue:
- (they) I developed a new video editing program!
- (i) What is your education? Camera operator? Directing? Why do you think your program will be better than existing ones?
- Such an education, I just tried other programs. And it seems to me that there are some inconveniences.
- Maybe you have special knowledge of image processing or video stream?
- In general, no, but I did this in my student days.
- Or maybe you know how to sell these programs?
- No, I have not thought about how to sell.
There is a lack of all three crystals on the face. Often people know how to create a pill. They are from the scientific community, they say that "all my life I was engaged in image processing." But this is not enough. They do not know the knowledge of the disease and the ability to deliver the pill to the patient.
2. Attitude to failure as experience
Most startups go bankrupt even before breaking even, because they do not have a significant competitive advantage, understanding of the “disease” and distribution channels.
Closing a business project is a normal business process. This is not something extraordinary. According to statistics, only 1 project out of 10 survives. Therefore, closure is the most expected outcome. It hurts, but it's part of the life of an entrepreneur and startup.
In any circumstances, you need to maintain interpersonal relationships, because the trust of investors and colleagues will be extended by another project that you will do. With these employees you will go to another project. Separate in one project as efficiently and constructively as possible in order to move on in another.
3. Methodical development of a business project
I usually start a business with a crush. In the modern world there is a lot of information, people, ideas around. But suddenly a certain insight appears: “This is cool, no one has done this yet!”. Having many years of experience creating a business, I go with this to my wife. And according to her reaction, I understand that it is better not to take on 90% of ideas, because I have tried many times.
But falling in love alone is not enough. It is necessary immediately after the appearance of the idea to talk with people, get feedback from them. If you understand that it makes sense to implement an idea, then the next step is to create a paper prototype.
At this stage, there is no need to develop anything, to invest nowhere. You just need to imagine that the product already exists. Write an ad to him, possibly make a landing. Try to sell it to future buyers. To someone to sit right on the bench. Would this person buy your product right now? Let him rate it on a 10-point scale. This is called the Net Promoter Score (NPS).
Then calculate how many people will give you 9 or 10 points. If out of 15 respondents no one rates it at 9-10, then it makes no sense to do this. A rating of 7 or 8 means that people are just polite, but they will not buy your product. This is the most important practical experience that I have received. In Silicon Valley, it's called "Fake it, then make it."
Beginning entrepreneurs for a long time come to the idea that if you just ask a person, you can get a huge amount of insights and understanding of the problem. If 20-30% of respondents put the idea of ​​9 or 10, then this is a very serious signal that you have found something.
4. Understanding the answer to the question “Why and for whom am I doing business?”
Make Decisions When You Don't Have Product-Market Fit Yet. This is an important concept in startups. Find your niche, your consumer, sales channels. As a rule, this does not work at the beginning. It is extremely rare for a startup to reach breakeven on the idea for which it raised money. In the search process, he makes several Pivot's - major changes to the product concept.
Before the money runs out, you need to make enough Pivot to find your client. If you have one or two years left, then you need to make 4-5 such “turns”. For each of them you have 2-3 months. We need to come up with another hypothesis and start testing it using a paper prototype. If everything goes well - make a real prototype, try selling it. Even if MVP is on sale, this is a good sign. Sell ​​on.
If the MVP is not gaining a sufficient number of nines-ten - take the next turn. With this method, the "Valley of Death" stage is performed. If during this time it is possible to find a growth point, users appear in the product, then you can scale.
Saibiko is the world's first handheld communication computer, the predecessor of Tinder, WhatsApp. This is a box where you enter information about yourself and the girl of your dreams. She vibrates when she finds such a girl at a distance of 150 meters. Then you contact her by writing a message and make an appointment.
We came up with this thing in 1998. We developed everything from scratch: there was no cellular communication and Bluetooth yet. This idea turned out to be so popular that in 4 months in 2000 we sold 250 thousand units (sold in the USA). We were even recognized on the streets of New York.
But there was a Nasdakov crisis. We tried to modernize the company, entered the European market. Then there was a famous attack. Wireless communication with unknown people has become a forbidden story for teens. The crisis continued for several more years. And we got into this meat grinder quite by accident.
There is obstinacy, but persistence. Stubbornness is what leads a business to collapse. Perseverance is what brings success. Finding a fine line between them, as you know, is extremely difficult. But this is the art of the entrepreneur. The only thing that can help with this is constant communication with your users. Need to absorb feedback like a sponge. Try to understand their point of view. Only such experience helps in quickly finding the difference between perseverance and stubbornness.
Link to video
Source: https://habr.com/ru/post/461353/
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