Late November and December is a great time to have a “real” job but also need to spend some quality research, analysis and planning time for a startup. Work efforts fall off a cliff after Thanksgiving thanks to either one’s own PTO or the PTO of others.
As I mentioned last week, I’ve been trying to build out our business plan. It’s coming along fairly well and I at least have a WAG on how much it’s going to cost to finish our product so we can go to market. In fact, I have a decent idea of the key market segments that should be interested in our product.
I have a lot of cognitive dissonance with completely made up numbers. They have to have some logic behind them other than wishful thinking. I’ve spent the last week? or so trying to find logic where almost none exists.
My initial numbers show a tidy $2mil in revenue by year five and a little profit. This model uses some logic based solely on estimates from Facebook and Google advertising. I have no way of estimating success of direct selling because, well, I’ve never pitched this product to anyone.
It’ll be damn good but who knows? Not me – at this point – that’s for sure.
I tried building out a model with aggressive SWAGS and that model was complete bullshit that I probably couldn’t wouldn’t defend in a pitch.
Hey there – these numbers look great – how’d you get them? Well, I knew you all needed to see exponential growth so I built my model using it.
Do you believe these numbers? I believe these numbers are possible, but I also think really mediocre numbers are possible and I also think the company tanking is also possible. The last part isn’t likely, though.
I’ve laid awake a few nights trying to figure out why I’m a) so worried b) struggling to pull any type of forecasts together … this is when it hit me that the reason I’m having trouble with any type of logical model is that the company is just too early in its development.
I need to get to users and show them the tool and get feedback. Their feedback will then tell me if this is a homerun, double, single or a strikeout.
*note – it’s about an hour later thanks to me going to do a little search for the next paragraph and then diving back into my planning*
A plan is coming together. We’re going to aim to crowdfund the first step of our development & in the process of fundraising I’m going to start pitching the future product to potential customers to get their feedback. I figure the feedback on the fundraising & pitches will help me better understand the market and my forecasts.