Welcome to “Small Business, Big Mistake,” where entrepreneurs face up to their biggest mistakes and share advice to help your company avoid the same fate. Check back to On Small Business every other Monday for the latest entry.
Open almost any business publication and you’ll read about “focus.” At conferences, you’ll hear keynotes on why you have to maintain it, and dating professionals will advise you to work harder on it. But why?
I suspect it’s because we’ve all been hurt by a lack of focus at one point or another; a problem that’s exacerbated when you’re an entrepreneur. We can’t help but see problems, as well as beautiful, potentially lucrative opportunities to solve them.
The kicker about focus, though, is that its real value becomes clear in hindsight — a lesson I learned the hard way.
The lure of a “big” opportunity
Our company’s first product, EasyBib, found success by expediting the process of formatting citations. My business partners and I founded the venture in 2001 while we were in high school. In short, our service allowed users to enter all the bibliographic information for, say, a research paper, and it would create the citation.
Six years later, after building our own resumes in college, we thought, “Why not also develop a service that formats a resume when biographical information is entered?” We could then build a searchable database of talent for employers. With a few hundred thousand dollars in the bank from EasyBib, we decided to go for it.
Since EasyBib was our main priority, we decided to outsource the development for this second project, and we found a student developer at NYU. Several months later, though, we found the code was subpar and the product was still nowhere near where we wanted it.
We thought with the right guidance, this could be corrected. But after missed deadlines, seeing elements of a product that did not match our vision, and most importantly, 10 months of time and $25,000 vanish, we decided to scrap our relationship and trash what we had built.
Still, six months later, the idea lingered. We felt confident that, if it was done right, employers could pinpoint the perfect candidate, and we would be rewarded with a hefty referral fee. We had started working with a development team in Argentina to improve EasyBib, and we thought they could help build our resume product, too.
Two years and $80,000 later
In the words of Yogi Berra, it was déjà vu all over again. Our product development was painstakingly slow, and the product was not turning out as envisioned. Our main developer soon announced that he was leaving the contracting company. It was a blow to the gut.
By then, it had nearly been two years since we invested in EasyResu.me. We still felt that naive excitement for what it could be. On the other hand, we had spent over $80,000, which to us (doing only half a million in revenue) was a massive amount of money. We were again left wondering whether to weather the storm or cut our losses.
Meanwhile, EasyBib continued to grow, as did the amount of time required to keep it moving in the right direction. There was a clear path to revenue, so we were forced to ask ourselves whether it made sense to keep investing in a new product or use that money to accelerate the growth of our main business.
The answer was clear: There would be no EasyResu.me.
Why focus really matters
In retrospect, it seems crazy that we wanted to build a totally unrelated product at such an early stage in our company. From the experience, we learned two key things.
Choose your battles wisely, for one. Entrepreneurs must assemble a talented team, build and maintain a great product, and figure out how to sell it. It’s challenging. It takes years. It takes money. We were already busting our butts to sell and create a great product out of EasyBib, and I don’t know how we thought we had the bandwidth to do the same for a second product.
And second, validate your concept first. Our process was flawed. We outsourced development and we did no diligence to see if people or employers wanted our product. While we knew we wanted the product, we should have corroborated the opportunity by building a simple version of EasyResu.me first.
Since ditching EasyResu.me, we have focused our energy on building EasyBib to 40 million student users, more than 1,500 institutional customers and a team of 37 employees. And now, we are starting to build another new product, one that enables people to create online courses for training and marketing.
Our approach this time is different. We first focused on building a clean front-end user experience to guage desire for the product. Then, we assembled dedicated teams on the business and engineering sides to focus on building and selling this new product, GetCourse, and we recruited strong leaders on our sales, marketing, and product teams on EasyBib to maintain that product’s growth.
All of this has allowed my business partner and me to step back, and ironically, balance our focus between EasyBib and GetCourse. We’re optimistic that this time we’ll get it right.
Neal Taparia is the co-founder of Imagine Easy Solutions, whose product GetCourse enables simple online course creation. He is also a member of the Young Entrepreneur Council (YEC), an organization comprised of promising young entrepreneurs.
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