There is a Process to Building a Business; Especially When Raising Funds or Onboarding Customers

By Jason Criddle 

Process to Building a Business

I have people come to me all the time with app ideas or business ideas and they assume that since I run an investment firm, that I’m automatically going to invest in them. I cannot tell you how many times I’ve heard someone with unwarranted expectations tell me… “but you are an investor.” 

Yes, but I’m not your investor.

Or they get upset because they binge watch Shark Tank from mommy’s couch and think investors are going to fight each other to write them a check because they have what they think is a billion dollar idea. That’s not how reality works. Process to Building a Business Everyone thinks they have a billion dollar idea. When they have never built a business that has even made one dollar, it’s hard to fathom.

Plus, there is some weird expectation out there from new entrepreneurs these days who think someone owes them something. People will cuss you out and talk shit to you because they believe you are missing out on some big thing. Process to Building a Business They expect money with zero knowledge or infrastructure in place.

 

Execution is what matters. Not ideas.

Ideas are not generally what gets funded. Especially not on Shark Tank. Or in big kid land. What they aren’t paying attention to is the companies that do receive funding usually have a customer base, or at least established infrastructure, or they’ve raised money from friends and family, or may have some cash flow, or any combination of the above.

But mostly, they have exhausted all of their options. Second mortgaged their house. Maxed out their credit. That earns respect. That’s what I like to see. Effort. Execution. Process to Building a Business How far did you take it on your own before you asked for help?

I want to see skin in the game before I am even interested. If you aren’t invested, I’m sure as hell not going to be. And, I am a technology investor; so when someone comes to me with a franchise idea, mineral investments, a service business, I have no interest. 

Even with a decent tech model, I want to know what all they have invested into it and also, did they go to their friends and family first before asking for my money?

 

People who ask for help before getting started on their own will fail in business.

Have you ever seen an ad on Facebook from a company that has a product or a service with a button that links to get started or to make a purchase and the comment section is full of people asking for more info? I cringe. 

You can’t read? You didn’t click on the website? You cannot make an educated decision on your own?

Even our FAQ in all of our software has a statement that says we will not respond to inquiries that are already answered or discussed in our FAQ, Terms and Conditions, or educational material. #sorrynotsorry.

If you aren’t willing to figure out what is right in front of you on your own, I don’t want you as a customer. Or a business partner.

Selling yourself and your brand is the first step to starting a business. If you are afraid, you won’t make it.

When I started my first landscaping company as a 10-year old kid, I didn’t get investors. I saved up my hard earned allowance and bought a lawnmower and dragged it down my street, knocking on doors. Process to Building a Business By the time I was 12, I had 60 customers and a 16-year old teenager and a 20-year old adult working for me.

Any service business can pretty much be started cheap or free. And NOT starting it on your own while waiting for an investor shows you aren’t serious about business. Anything worth starting should be started with everything you’ve got, or why bother at all? You are just wasting your time and everyone else’s.

If someone is too afraid to go to their friends and family, or if someone cannot raise a few grand or 20k on their own… if they aren’t willing to see if the people closest to them believe in the idea, then why should I waste my time? If you can’t find a customer on your own, you definitely can’t build a brand around it.

My Carbon App Co-Founder is about to go through this lesson himself.

Let’s take Carbon as an example (download carbon.com) Shazaib Khan paid for the majority of development of the app on his own. That shows tenacity. And I am proud of him for it. But now comes the part where we form the company, investment documents, bring on anchor sponsors, and start funding the business side of things. Building the software and infrastructure is one thing. But it’s not running a business.

He may not know it yet, but I am going to force him to do a Friend’s and Family Round. He is generally a quiet, introverted young man, but it will be good practice for him to go raise a little bit of money from his internal network on his own before we reach out to any real investors. He needs to suck it up and learn how to do it. That way he won’t choke in a real investor meeting.

The good thing is, he has me as his business partner. So I provided my team, my knowledge, my infrastructure, filled in a ton of gaps, structured the entire brand, I’m helping him close sponsors already and teaching him the business side of things. And, I don’t launch MVPs like most people. At launch it will be a full launch with Smartr’s full infrastructure in place that will allow it to take on transactions, paying customers, and everything from day one. It’s the way I do business. 

 

If your customers can’t buy right now… they won’t. And they more than likely won’t come back.

When people do have an idea for a business and especially when seeking funding, they need to look at it from the investor, customer, Process to Building a Business and general business side first. So many people build passion projects before they ever think about how it will make money or how it can make investors a return worth enough value to invest. Which is why I prefer software. 

Once software is built, it can be forever scaled with little to no input. As opposed to a service business where someone won’t make any money if they aren’t doing their job. I’m not going to listen to someone’s excuses about why they didn’t make my money back because their tummy hurt that day. 

I want something that can take on customers and deliver a successful product without anyone’s involvement. That means everything a customer needs to know, buy, Process to Building a Business and be delivered or used needs to be readily available in real time so the only thing that needs to be done is customer acquisition.

Which also means; your passion project that you care about may not have a customer base. You need to find customers who are looking for your product. Not building a product you want and hoping to find customers. There are a lot of people who are building solutions to problems that don’t exist on a massive enough scale to make money.

Which is another great Carbon app example.

Yes, it was a passion project for Shaz and I to build a great tool to bring together the car community. The best tool. But that’s just it. Process to Building a Business The car and motorcycle enthusiast community is comprised of MILLIONS of customers who only have access to mediocre tools. And tools that don’t care about or empower them.

That means we don’t have to go find customers. Process to Building a Business Our customers are everywhere. We just market the product to them. And with Smartr’s referral technology, virality is built within the product. We are delivering the customer a better product than the competition that gives them incentive to get more customers on board for us. Everyone wins.

To Conclude My Rant…

Business isn’t easy. And although I encourage everyone to give it a shot, there are steps that cannot be missed

If you have a piss poor website with a contact us button, no place to make a purchase, no refund policy, Process to Building a Business no info in place, I’m not buying it. Let me give you a final example:

I had these two IT students come to my home office to help set up a server rack for me. Process to Building a Business They advertised online that they were willing to work for free because they needed experience. So I gave them a shot.

They came and “worked” for 5 hours. Not only did they spend a majority of their time looking up information on ChatGPT, they did a lot of stuff wrong. Process to Building a Business They didn’t listen to many of my suggestions. And they had no real plans from point A to point B. By the time they got hungry, they both started working like whiny teenagers with attitudes and no concentration skills. These weren’t 40-year old IT professionals. They were 19 and 20, trying to start their own brand.

But, me being the great guy I am, Process to Building a Business I paid them both $30 an hour for their time, and invited them to come back in a couple of days to finish the job. They made $300 bucks for a crappy job they offered to do for free. I figured it was a very generous day for two guys without enough experience to work at Taco Bell.

While in their absence, my non networking engineering teenage daughter helped me fix a lot of their mistakes and get things ready for their return after I ordered a few parts we still needed. 

Over the course of these few days, Process to Building a Business they came up with the bright idea that their next visit which would have taken them no more than 3 to 5 hours was suddenly worth $2,000 dollars, which they requested in an email, signed… see you tomorrow!

I laughed so hard. Everyone I showed the email to laughed. Process to Building a Business I even laughed a little more. All of a sudden, they decided they were $250 dollar an hour IT professionals. I charge $250 to $500 an hour for what I do, and I’ve made companies billions Process to Building a Business. The nerve to suddenly think they were worth so much showed more unprofessionalism than they realized.

Did they gain some kind of miraculous experience during this time I didn’t know of?

I responded to their email and told them why they no longer worked for me. You both showed up in dirty clothes. You acted like crybabies when you got hungry. You guys have no brand. No website. No business. No terms. No contracts. No way for your customers to be legally protected. No logo. No plans. No procedures. No legitimate business. Nothing. You made mistakes. Didn’t listen to me. Wasted the last hour you were there because of not listening to me… and I was still willing to offer them a chance because they were generally good kids.

I am pretty sure they responded with a list of justifications and a free half-assed Wix website they threw together to make themselves look better. With a Yahoo email address no doubt… and figured that would appease me. But I deleted it and moved on with my life. They went from kids I was giving a chance, to complete and utter jokes who I couldn’t take seriously. There was no value behind their ask. Other than they just decided they were worth more money. 

Then, guess what? I hired an IT pro with 20 years of experience who fixed everything in 2 hours at the rate of… $40 an hour. I gave her the $300 dollars I was going to pay them the second round for a job well done. A $220 dollar tip isn’t bad when you know what you’re doing. One knowledgeable woman replaced two boys who didn’t know who they were messing with.

If you don’t understand business, don’t go into business. And if you expect real customers or investors to give you money and take you seriously, you better have it all figured out before you go to a single customer. Or any investors. Money isn’t a joke. Neither is wasting someone’s time because of your ignorance.