Is this enough validation?
I think that I "fell into" a business idea...and I have one paying customer who has been paying me each month since August. Is this enough validation to pursue the idea? I haven't been doing anything due to university studies and paralysis due to hesitation on whether or not this is a good idea.
Maybe I'm being an idiot, but I'm truly stuck as to what to do. I don't know whether or not I should build my infrastructure now, or can the whole thing and do something else.
I’ll echo the other comments of your next step is finding a 2nd customer.
I’d also suggest you find a 3rd and 4th customer too, and keep going. You can learn a lot by thinking of yourself as the service you’re providing and then building the tools that help you optimize your time as you grow to serve more and more customers. Obviously a great outcome is building a self-serve tool, but that need not be where you start.
All the best on your adventure! 🤗
Well said, that man!
Having one paying customer is awesome! More than can be said for my latest project :)
One question to ask yourself is "what other companies also have this problem?". It may be competitors, or their customers, or every business? Your customer may even suggest you to other companies they know?
Either way, I personally wouldn't build infrastructure yet, but focus on finding a second customer.
Don't worry about scaling to 100/1000 users, just start with things that don't scale http://paulgraham.com/ds.html
That Paul Graham article is a great, read Joseph. Thanks for sharing!
If you like that, you'll love YCombinator startup school :) https://www.startupschool.org/
Having even one paying customer is strong validation, and a lot more than most people achieve (there's the startup adage that if one person will pay for it, many other will as well).
Unfortunately that's not enough to tell you if it's a reasonably scaleable business model, particularly if it's quite a niche offering.
I agree you should try to lock in your 2nd to 5th customers.
You should also do some basic assessment of cost to acquire those customers (eg. did you physically spend a lot of time or money to get them, can you scale that somehow cheaply), and your market size (eg. is this a niche tool only a handful of people in your city need or does it have mass market appeal).
If you can explain the tool better we may be able to help provide feedback on whether we'd expect it to scale.
So really, all I'm doing is spooling up VPSs via a script, running a script on them to set them up for the LAMP stack, setting up SFTP, and giving a customer a way to upload files. So they basically get the ease-of-use that they do from shared hosting, but now on a VPS that is managed by someone who is profecient with linux and system administration (me).
To me, this seems like a better deal than paying for shared hosting, as your website is now ready to scale with your growing business, and you get more value for your money. Why should you have to share resources with thousands of other websites as you do with shared hosting? Shared hosting, to me, is like living in a can of sardines and it makes your business look unprofessional but I may be the only one who thinks this way.
The funny thing is, my only customer is someone who I built their website, and then set up their hosting for them manually -- so this tool didn't exist at all. Basically, I took them away from Wix by making them a simple website and hosting it for them so now I save this guy about $40/month. In my head, I think that there must be people like him or businesses wishing to move away from shared hosting but are not technically savvy enough to do so, but I keep unconvincing myself.
I see. You're describing automating provisioning of services on VPS? I believe many hosting companies will do this for you for free, or like DIgital Ocean offer various services pre-templated.
Having previously run and sold a hosting company I probably wouldn't advise getting into anything hosting or server related, it's a relatively 'old' industry and extremely saturated.
If you could roll this up as a simple one click SaaS service that does a bit more, automating various provisioning functions then I think there could be more to it.
If your experience is in servers then I think there are still some interesting opportunities in DevOps services and niche monitoring software.
That was exactly the idea -- bringing the average person the benefits of a VPS through a one-click web-based SaaS. Right now, it seems like a VPS is for the technical folks only, and everyone else is being forced to use shared hosting. I've found one competitor in this market (cloudways.com) doing basically what I plan to do with success. They are the only competitor I have found, however, so that's kind of discouraging.
My company was researching this angle for a while. Basically the market looks something like this:
Pure VPS customers - reasonably technical, may need some support configuring servers for their specific website. This market is getting eroded by the likes of Digital Ocean and AWS. Digital Ocean makes it super simple to spin up an app (and deploy templates for popular CMS's like Wordpress). The most technical users that want most control or have big apps go to AWS.
Customers that kind of just want it to work - They have a pre-set CMS and don't really care about hosting - there are many platforms like WPEngine that just do managed WP hosting (which like 80% of normal websites run on). There are also managed hosting providers that do other CMSs.
Customers don't really care about the CMS - They just want a website - They will generally now go to Wix, Weebly or Shopify - out of the box website.
There are a few providers kind of doing an in between model - Maestrano does one click hosted apps, CMSs, Heroku does pre-templated hosting, and Digital Ocean has pre-built templates like I mentioned.
You'll find a lot of hosting providers do offer '1 Click App installs' as well - generally they will be releasing a VPS with CPanel configured to install Wordpress or Drupal etc on boot.
I think there's still space to create more One Click App marketplaces like Maestrano, or maybe niche automated functions for VPS, but yeah I personally wouldn't get into the VPS space at this stage.
Ah, well, shit. That's too bad. I guess I'll keep my current guy on-board and just keep grinding at something else :) Thank you so much for the heads-up. I'm glad I didn't waste my time.
I fell into this "trap". I followed all the steps one would to validate an idea, I "Mom Tested" my way to a couple of credit cards, I created a high fidelity MVP (that does nothing just purely UI). So I felt very validated and started building the whole thing out as a SaaS business, targetting accountants and bookkeepers. In the end, I got 1 very loyal, paying customer but for a good half a year, I have never been able to get the second customer.
I am rather convinced that the solution I built is TOO specific to my one and only customer that it has become a custom solution for them. My advice to you is: like the rest of the advice here, get the second, third and so on.
That's really interesting, actually. I never thought of something being too specific. Luckily for me, I don't think my idea is too specific, but it's a good thing to keep in mind.
Did you talk to accountants irl? Have they just not been interested n your product? I'm interested to hear more!
I talked to several accountants and they all acknowledge that this is a problem that they throw people at (assistants), for some reason however and this could be because of my lack of experience in sales, I was not able to close any sales. Talking to my fellow co-founders, it is possible that either the pain is not painful enough or I have the wrong solution for the right problem.
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What do you mean by that? Do you mean that if I am profiting then it's worth it?
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Thank you this was incredible :)
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At least 200% per subscription.
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Sorry for the late reply here!
Also I think the 200% markup is unsustainable and will have to drop it to about 80%.