Solve migraine problems.
This statement has been on my mind consistently the past few weeks.
I think anyone who wants to pursue entrepreneurship should have it on the forefront of their mind, too.
I’ll explain why in this post.
I recently read the book All In Startup and it has had a huge impact on how I view entrepreneurship and startups.
The book was written by Diana Kander and it teaches entrepreneurship lessons through a fictional story of an entrepreneur, Owen, who spent over a year – and hundreds of thousands of dollars – on a startup that was not catching on.
Owen’s chance meeting of a successful entrepreneur at the World Series of Poker ends up transforming the way he thinks about his business as well as entrepreneurship on a broader scale.
Today I want to share a few of my biggest takeaways from the book.
1) Minimize the Chance of Failure
This book is focused on minimizing the chance of launching a startup that fails. It’s based on “evidence-based entrepreneurship”, which is a newer field of study.
I think this excerpt from Amazon says it best:
You will likely get only one opportunity in your life to go “all in” in on an idea: to quit your job, talk your spouse into letting you drain the savings account, and follow your dream. All In Startup will prepare you for that “all in” moment and make sure that you push your chips into the middle only when the odds are in your favor. This book holds the keys to significantly de-risking your idea so that your success appears almost lucky.
Anytime someone launches a startup there is risk. There is risk that the business will do well in the beginning and then tank or that it will never take off. The idea could be logical and make sense on the surface, but customers are not always logical.
In my past business and website failures my first step has always been to create a product and then seeing if there was demand for it. This can lead to a lot of wasted time and money, especially when you start talking about startups that will require significant capital if pursued.
In All In Startup a different approach is proposed. Instead of first creating something that “sounds” like a good idea, the first action should be to find out what problems customers have, and how they prioritize their problems. Which leads me to my favorite takeaway from this book…
2) Solve Migraine Problems
If every entrepreneur aimed to solve migraine problems, the failure rate of startups would be drastically lower than they are today. Anyone who has experienced a migraine knows how painful they can be. They would do anything to get rid of it.
If an entrepreneur focuses on “migraine problems” they are much more likely to succeed because people who are dealing with a migraine problem are willing to do anything to solve the problem. If an entrepreneur presents a solution to their problem, they will likely be elated and willing to pay for the solution.
There are many problems in the world today that are not even remotely close to migraine-level problems, yet entrepreneurs try to solve them and then wonder why they can’t seem to sell their product or people don’t utilize their problem. In reality, it might not be a problem that is big enough for them to care about.
While the book goes into great detail about how to identify what a customer’s migraine problems are and what problems are not, an example I thought of is gutters. Cleaning out gutters is a huge pain if you have large trees surrounding your home. Entrepreneurs stepped in and solved this problem in an innovative why by creating gutters that need zero maintenance. I’m not surprised that new homes utilize their solution or that homeowners upgrade frequently.
3) Find the Shortest Path to the Ultimate Customer Action
So let’s say an entrepreneur identified a “migraine” problem and think their solution is the answer. While the entrepreneur may be tempted to put their foot on the pedal and spend tons of money developing, marketing, branding, and promoting their product or service, it’s not the best approach.
Instead of fully developing a product before pitching it to customers, entrepreneurs should find the shortest path to the ultimate customer action. If the goal of your business is to get a user to order a custom widget, you don’t need to create the widget before trying to land the customer sale. Ideally you could get the customer to commit to the order before creating the widget.
This is actually advice I first heard from a marketing professor in college. This professor was the CEO of a number of startups throughout Europe and successfully launched a number of his own startups. Tim Ferriss focuses on the idea of gauging customer interest in The 4 Hour Work Week. Clearly this advice has worked for many entrepreneurs, and following this advice could save someone a lot of time and money.
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I honestly can’t say enough good things about All In Startup and continue to think about the lessons it teaches weeks after finishing the book. My wife can attest to the fact that I stayed up ridiculously late reading this book and literally could not put the book down.
Don’t take my word for it, though: it has almost 100% 5-star reviews on Amazon:
Check out All In Startup – you won’t regret it!
What do you think about using “evidence-based” strategies to minimize the chance of business failure? Have you heard of All In Startup before? Is it something you’d consider reading?
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Awesome. I’ve never really thought about “migrane problems”, but this is clearly the key to success in the majority of businesses. If you can solve a problem that a lot of people have, and they causes a lot of people sleepless nights, you’ll do well.
In my prior business, we tried to focus on the client’s pain points and determine what was making them sweat. The same is true, and probably even more critical, in a start up. Thanks for reminding me of this!! :)
Sounds like good advice to me. Filling an existing need is certainly easier than trying to create a need, convince people they need to fill it, and providing a product. Gutters and migraines are both great examples–you don’t need to convince anyone that those are problems requiring a solution.
moneystepper No problem! Yeah it seems like such a simple concept, but I think in startups people tend to get so focused on an idea that they end up forgetting that what they REALLY should be doing is solving someone’s problem.
Mrs. Frugalwoods Yes, and in the book Diana did talk about how some companies – like Apple – have the luxury of having lots of money to bet on customers wanting their products compared to a startup where you may only have “one shot” to succeed. The big companies can afford a few complete failures, but entrepreneurs really can’t if they go “all in” on their idea.
Never heard of it but it sounds like good advice to me. I like the idea of starting a business based on solving a huge problem for people.
I’ve never heard of the book, but it sounds like a good read. I think it’s a solid approach and one that would breed a certain level of success. As a business owner if you’re solving problems for people they’re not only going to remember and recommend you to those they know with the same issue, but you’re going to stand out amongst the the crowd which are all good things.
I think this would be a great book to get Jay. He would definitely be interested!
I love the gutter analogy. My mom still has the old style, won’t change them, and Jay about wants to gag cleaning them out!
Thanks DC. I’ve never heard of this book. Based on your review, it definitely sounds worth it! :)
I have never heard of this book, but I love the concept of solving migraine problems, it part of the reason why I started my own company. I saw enough people struggling with money issues that weren’t addressed by the larger financial services community. So rather than sit back and watch others suffer from migraines, I created a solution for them.
Holly at ClubThrifty I highly recommend it! I literally stumbled upon it at the library. Prior to that I had never heard of it. I’m glad I did because it has really changed the way I view entrepreneurship.
I’m always adding to my Kindle book wish list, so this will go right on there (and it sounds like it really had an impact on you, so I’m looking forward to it). The points you laid out make complete sense. While they’re not super scientific or a magic formula, they are easily forgotten through the zealousness of a new venture.
FrugalRules I’m really excited about evidence-based entrepreneurship and the potential it has for people who are looking to go “all in” on an idea. And you’re right, there could be significant word-of-mouth exposure gained if you solve a big problem for someone.
kay ~ lifestylevoices.com I still have old-style gutters as well and it’s a HUGE pain! I look forward to getting the newer models or just buying a house that has the upgraded ones.
I’d highly recommend getting the book for Jay. I seriously am passionate about this book!
Interesting! That sounds quite similar to some of the things that I’m learning in the Monthly1K course by Noah Kagan. It’s all about proving you have a market and figuring out the minimum viable product. The first rule is “No coding.”
blonde_finance That’s definitely something I’ve noticed about your business – it solves a problem. The results you’ve been sharing have definitely been impressive and you and your business is clearly having a big impact on people’s lives.
moneypropeller Oh that sounds like an interesting course! The “no coding” rule is something I should look into – it always seems to be the first thing I do!
theFinancegirl I hope you enjoy the book! I really liked it and enjoyed the takeaways it offered. I thinks sometimes the simple things are easiest to forget, like the fact that a company needs to solve a business need.
This sounds like a great read, I’m adding it to my list : ) I’ve been thinking a lot about how to avoid potential issues when I start up my tax prep business this spring.What kind of issues could arise? How do I avoid these issues?How do I make my clients happy? I always like to be prepared for the worst case scenario when possible!
You are so right that a huge mistake many people make is devoting all their energy to problems that are really not a big deal. Being able to determine where to put your energy is certainly half the battle. I learned years ago that I can’t do it all and it’s better to concentrate on what I can do best and train or hire someone else to take care of the small stuff.
Thankfully, it doesn’t take much for me to go all in. Not being married and having no kids to worry about makes taking career risks much easier. Before blogging and freelance writing, I failed at quite a few things. I like the trajectory I’m on now though.
I like the ‘migraine’ analogy. I think that’s why personal finance is such a tricky thing to sell. Most people don’t really have a migraine: things aren’t painful enough to deal with yet.
BudgetforMore I’m glad you are adding it to your list! Seems right up your alley, especially with your interest in establishing your own business. I think you are asking all the right questions.
Eyesonthedollar I think you’d have a wealth of information to share with people based on your years of experience as a business owner. I do think that solving problems that aren’t a big deal and that people aren’t willing to pay for is a big issue.
brokeandbeau I do think that people who are not married and do not have kids are at a natural advantage when it comes to going “all in” on an idea. I do think that can sometimes make them go all in on the wrong ideas, though, which is something that is highlighted in the book. I also think there can be situations where being married is a HUGE advantage because you could potentially live off one income while the other partner is fully invested in their business without any financial pressures.
DonebyForty Good point. I do think there is a reason frugality and side hustles are popular topics in the personal finance blogosphere, since those topics solve potentially “migraine” level problems for people.
I like the idea of solving a really painful problem for people, but then my question is
1) how do you identify these problems?
2) how do you become the expert to solve these problems?
My guess would be to become an expert in a field so you can identify and solve the pain problems for people.
What’s your guess?
Sounds like a great read, DC. And I agree solving “migraines” is key to business success. People lead such busy their lives today and if you can help solve a problem or make their life easier in some way, than you have something they want. I think it’s important to have your hook, but you also have to know how to get it in front of clients. When I coached advisors that was an area many of them struggled with. They could help solve a problem, but they had no clue how to really market themselves. And as terrible as it may seem, sometimes the most successful businesses aren’t even the one with the best solution, they just did the best job marketing it. So the two really go hand-in-hand. Have a product/service that solves a problem, then market smartly.
I’ve been eavesdropping in on some venture capital networking meetings at the side hustles I sometimes do, and everything I always here is come up with something to solve a problem. Seems that is the best underlying theme if you decide to do a startup.
I’ve already put this book on my reading list after you suggested it on my library post, and now I’m quite excited to read it.
I really like the idea of doing the smallest thing possible to test your product, being as effective as you can without wasting huge resources. I’ve also worked through some of the $1k course that moneypropellor mentioned below, which was great for highlighting this (although I’ve taken a rather lengthy pause on that course for the moment!)
Sounds like an awesome book DC! Thanks for the thorough review – and I am with you on migraines – they are horrible!
Nice DC, loving that you are embracing the entrepreneurship bug and also the affliate links, if I do check out this book I’ll have to make sure I purchase it through here :)
The one really big point I like here is having the customer commit before you build it, I haven’t read it yet but the lean startup by eric ries goes into a similar concept called the MVP, minimum viable product
pfjenna I don’t think you have to guess : ) The books primary focus is how to figure out what a “migraine” problem is and how to also figure out if they are willing to pay for your solution to the problem.
ShannonRyan Great point, Shannon. I think there are a lot of “could be” entrepreneurs out there who simply do not know how to market their service/product/solution. Which is probably why there are a lot of business coaches nowadays.
Beachbudget Thanks for sharing! It’s cool that you’ve been able to actually listen in on some of these conversations and it sounds like it definitely confirms what this book is teaching wannabe entrepreneurs to do.
Jason@Islands of Investing Yeah that course does sound pretty valuable. I hadn’t heard of it until Anne mentioned it. I’m glad the book is on your reading list and I think you’ll really enjoy it. I stayed up WAY too late reading it but I just couldn’t stop reading.
Laurie TheFrugalFarmer Thank you for stopping by and commenting. I’m glad you enjoyed the review! Yes, I think migraines is a perfect analogy.
mycareercrusade Haha thanks for noticing the links ;) Amazon actually dropped their program from Minnesota for over a year because of a tax law that was passed here. They quietly re-entered in October (though you have to set up a new account and can’t “re-activate” an old Associates account).
Oh I’ve heard of the Lean Startup and definitely want to read it. I need to get it added to my list, thanks for sharing!
Have you found much benefit in the Amazon affliates account? That’s a shame that they did that but is an interesting development.. I get the impression that tax laws in the states vary from state to state and could become quite complex..
You’re welcome and there’s plenty of books I have lined up as well, are you on Good Reads? If so check out my list, there’s around 600 there :)
mycareercrusade Well I haven’t been able to use the program for the past year and a half so I’d say “TBD” as far as how much value I get out of it haha.
Yeah tax laws do vary state by state. You of course get hit with the Federal tax, then you have your Stat taxes, then if you freelance or are self-employed/small biz you get another tax on top of that (which is more than 10%) so it really just kind of sucks haha.
Woah I do not use Good Reads but wow 600 books? That’s a ton!