May 4, 2019

Sounds cool. Probably will make no money.

Harry Dry @harrydry

I made a dating site back in the day. The launch couldn't have gone any better. It went completely viral, got featured all over American TV, I had 4000 users overnight.

And... I made just $40! Why? Dating sounds cool. But it's an incredibly hard market to make any money in. Especially as a bootstrapper.

Let me give you another example. @dantelex (sharp guy) launched a site called Barttar last year. A site where you could trade (or barter) your skills with other people. It sounds cool. It did well on Product Hunt. Fun to talk about at the pub. But it's just not the type of business that will make money.

Why? Just like dating, it requires a minimum threshold of users before it can provide any value. Facebook are in a position to launch an exchange platform. A bootstrapper isn't.

A lot of people are ploughing on with styles of business which are incredibly hard to make work. Below I've tried to think of a few styles of business which are suited to Indie Hackers:

  • Teach people about a niche
  • Sell to business' for $100 / mo
  • Marginal Cost of Production is Zero
  • Can spread the word without reliance on ad spend
  • Doesn't require a minimum threshold of users
  • Can launch MVP < 1 month

Don't force yourself into this mould. There's more ways than the way to do it. Most importantly: play to your strengths

#fyi

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    Agreed. I think too often we come up with product ideas, which are not the same as business ideas. A product is just one part of a business. You also need to consider your target market, your distribution strategy, your pricing model, and how all four of these things fit together.

    If you're an indie hacker working with limited resources (time, money, manpower), you've gotta make some tradeoffs. Some product ideas etc. won't work well for you, because they require far too much investment to get to ramen profitability.

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      funnily enough you told me this about a year ago and I didn't listen. A great distinction between "business idea" and "product idea" is https://framedtweets.com/ vs https://140canvas.com

      Both very similar products, but framed tweets sold 300k, and 140Canvas sold $150.

      Framed tweets has higher prices, lower cost of production, scalability and virility build in. Subtle tweaks which turn a product into a business.

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    Very well articulated. Thanks for sharing. What is your take on "Sell to businesses' for $100/mo " vs "sell to consumers for $5-$10/mo" do you think later could still be a good model for an IH?

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      Depends on the value your product provides & how you pitch it.

      If you want to make $100k/mo, you need only 1000 businesses.

      But to make the same amount of money, you need 10k customers at $10/mo or 20k customers at $5/mo.

      I feel like the latter is easy.

      Also, depends on how much you want to make.

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        Yes, make sense.

        Why, according to you, later is easier?

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          Oops, I meant to say former is easy. Selling to businesses is much easier because they can pay huge sums. Consumers are a hard sell. They are used to free software by big companies so they think all software should be free. Business have a budget that they have to spend & if your product provides enough value they don't mind paying hefty sums.

          A current example that comes to my mind is Key Values by @lynnetye. Listen to her podcast on IH.

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            But don't also forget that selling to (bigger) enterprises means getting the buying center right, longer sales cycle and possibly higher risk if you rely on a small amount of big fishes

            I would say, that this "equation" heavily depends on the product or business offering and also the question, whether you can address both ends of the customer segments...

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              Very true. That's why my first statement started with "Depends on the value your product provides & how you pitch it."

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      Of course. Hundreds of thousands of people have got rich selling to consumers for circa $5 — $20 / mo.

      Kapwing by @jjejje springs to mind

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        We're definitely not rich yet haha. On this topic, my cofounder and I really enjoyed this blog post when we were in the early days of building Kapwing. Entrepreneurs can go after consumers at $5-$10, but they have to sell to a lot of them to build a sustainable business. It only works if there's a big market and willingness to pay.

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          Great blog post! Thanks for sharing @jjejje.

          I understood the tradeoff of hunting Bees vs Elephants. It is easier for someone who knows some business well to build and sell to that niche. For most people isn't it easy to build a consumer product?

          Before building https://www.kapwing.com/ did you think about the tradeoffs? What led you to build for consumers instead of businesses?

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            We actually plan to sell to businesses long term! Hoping to go the bottoms-up SaaS route, mostly because that's where we think the larger business opportunity is. We want Kapwing to sell to companies who want to enable their employees to make video, images, graphics, animations, audio, etc with a simple, collaborative, accessible, and trustworthy platform.

            Even modern B2B companies have to have a product experience that feels simple and easy to learn for consumers. I heard a talk from Slack's Head of Digital Marketing, and she said Slack is a "B2C2B" company. I like that :)

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    How did you manage connect payment processing for the dating site? I've been struggling to connect any gateway for my dating MVP.

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      i used stripe

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        thanks

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      1. is a really great point. Something I'd never really considered before until i listened to the podcast.

      How did your own project go, I never heard too much about it.