Hello {{First name|Predictable Revenue community}},

Live event: Thursday February 26th, I’m hosting a live event where I’m going to be talking about the ideas in my Most Dangerous Moment in a Startups Life post with Alex Shartsis, author of the Seed to Sequoia newsletter and founder of Skyp. Register here.

Onto the newsletter…

I spent 18 months building voltageCRM.

During that time, I talked to roughly 150 sales leaders. And you know what I did for most of those conversations? I argued with them.

Not in a productive way. In a "no, you're wrong, you're not seeing this correctly" kind of way.

Turns out, I was the one who wasn't seeing things correctly.

Here's what I've figured out since then. When I started Voltage, I was about 40% correct and 60% wrong. And the real problem wasn't that I was partially wrong. The real problem was I didn't know which 40% was right and which 60% needed work.

I'd spent 10 years as a salesperson getting pulled into every CRM project at every company I worked for. I was the CRM kid. And I noticed something that felt like a real insight.

When CRM was on-prem, something you installed on your own computer, it was yours. It was a personal productivity tool. It replaced the cardboard Rolodex that sat on your desk. (I actually had one of those Rolodex-branded business card holders, though it was never really that full because I was pretty new in my career.)

Then CRM moved to the cloud.

And suddenly it wasn't about salesperson productivity anymore. It was about dashboards and reports for managers. Which was arguably extremely valuable, but as a salesperson, I felt ripped off. This tool used to be for me, and now it was for somebody else.

That insight was real. That was my 40%.

I took that insight and said, okay, the solution is I'm going to build my own CRM system.

And everybody hated that idea.

But instead of listening, I argued. I told prospects they were wrong. I told them they weren't seeing it correctly. Because I was the smartest person here, and I'd thought a lot about this, and I was right, and everybody else was wrong.

When you're building something new, you're looking for problems that other people have that align with an insight you have. It's a combination of your insight and their problems that sets the initial direction for a company.

It is not the other way around.

We all have this view of Steve Jobs as the guy who said, you know what, I really want to make a phone, so I'm gonna make it happen. But I don't think that's what Steve saw. Steve saw the phone experience, this awful thing where you're carrying a phone and a camera and an MP3 player, and said, I bet people would love a beautiful solution to this problem.

Steve saw a problem and found an elegant solution.

What I did was say, you know what, I want to build a CRM system. It's gonna look like this, it's gonna feel like that, it's gonna do X, Y, and Z. Because I'm the expert.

Yes, you need to be contrarian as an entrepreneur. You need to be a little bit wrong. It's okay that people think you're crazy. But it's not okay not to listen to prospects.

I was talking to another entrepreneur recently who's trying to find her first customers. She has this insight that's really valuable. And she was asking whether she should find a technical co-founder, or work with a consultant who offered to help close deals for commission.

My advice was neither.

Before you start looking for a CTO, before you start building anything, go sharpen your market hypothesis. Strengthen that 40% to a 60%. You don't have to get all the way there, but you certainly don't need a deal or a co-founder to get partway there.

You need to run extensive customer development interviews. Because starting a company is rarely just your idea coming out perfect the first time. It's usually this process of finding something that adds a little bit of value, then finding ways to make it better.

Even if you're solving your own problem, there are going to be so many different user types, so many more different users than you are. You still need to account for how everybody else thinks about the problem, how everybody else sees it.

There are two pieces here.

First, recognizing and admitting to ourselves that we're only 40% of the way there. And that's okay. In fact, that's normal. That's to be expected, especially when you're early and you don't have customers.

Second, by framing it this way in our minds, it helps us see the lines of where we're likely to be correct and where we're likely to be incorrect.

We have this whole formula. X plus Y equals Z. If 40% of that is correct, then our job is to find the 60% that's incorrect. And that's gonna be in different places for everybody.

Whether you're starting something new or you've got a startup in flight, how much of your market hypothesis is 100% correct? How much is incorrect? How much needs more information to be filled in?

That's the thing I'm thinking about.

Collin

PS - If you're in that early stage where you're trying to figure out your market hypothesis, I wrote about this exact process in "The Terrifying Art of Finding Customers." It's less about cold email tactics and more about how to actually figure out who wants what you're building. Grab it here.

PPS - We’re now up to 30 × 5 star reviews on Amazon (4 of those are from Audible),