Hey, what's up?
John Sonmez here from simpleprogrammer.com.
I have a question about how to analyze the cost of a project.
I don’t think I've really talked about this very much, especially when it comes to building
your own project.
This is from Ashish and he says here, "Hello, John.
How are you?
If I want to make any project based on Java technology and make marketing of that project,
how could I analyze the cost of the project and marketing based on that project?"
This is an interesting one.
I think that the reason why I'm answering this question even though it might seem like
kind of a silly question to some of you is because I think that a lot of people that
want to become entrepreneurs they don’t really think about this very much on how much
is it going to cost to build a product and how much to market that product, and that
can be really expensive.
Okay.
Also, you might not want to go down that road.
What if I said that the cost is zero?
What if I said that don't plan on just spending a bunch of money building a product and then
marketing that product?
Because for most entrepreneurs, for most people starting a business, that's not a good viable
option because what is it going to cost you?
I mean let's say that it costs you $100,000.
Let's say it cost you $50,000 to build the software and $50,000 to market that software.
Are you actually going to make any money?
Where are you going to get that?
You're going to make this big investment up ahead of time?
If you're a startup and you got VC money and you're getting funding, that's a totally different
story.
For most of us that are like building businesses that are bootstrapped entrepreneurs, I would
not recommend doing it that way.
I would not recommend planning out how much the software is going to cost to build and
how much it is going to cost to market it because you need to make sure that your idea
is viable first and then you can actually sell the software, and then you've got someone
to sell to.
I would highly recommend that you start off with what they call in the software development
industry, I'm sure that you've heard of this, MVP or minimal viable product.
Instead of trying to plan out and budget this whole thing, start with something small.
Go and find a community, find customers before you even build a product.
Go out.
You're not spending money on marketing, okay?
You're not putting out Facebook ads and all this.
What you're doing is you're knocking door to door.
I mean I'm saying that sarcastically, but what I mean is essentially you're picking
up the phone.
You're going to find—let's say you want to build some software for dentists, then
you're going to go to the dentist office and you actually are knocking door to door.
You're calling them up.
You're knocking on their doors and you're saying, "Hey, look.
I'm thinking about building the software for dentists.
Its' going to help you do this particular thing in your business.
Would you pay for this?"
Then if they say yes and say, "Okay.
Write me a check and I will build you the software.
If I don’t build it in 6 months, I'll give you a refund."
I'm serious about this like actually collect some money or give them a discount or collect
the deposit on it to show that that's the way that you're going to know that—then
if you do that then you can ask the question of how much will it cost me to build the software
and then you can ask the question of how much will it cost me to market it because you already
have an idea of what it costs you to acquire a customer and you'll know that the thing
is valuable.
I think the reason why I'm saying this way is because too many people put the cart before
the horse.
It doesn’t work that way, you know.
Believe me, I spent money on marketing.
Marketing is really expensive, especially to market on the Internet.
Unless you've got something that you know is going to sell, you're just going to burn
money.
If you think you're going to just like build some software and spend a bunch of money in
Google AdWords to sell it, you're just going to burn money.
Trust me.
It's just not going to work, plus software development projects always go over time and
over budget.
So you really want to make sure that you start off with the smallest possible thing.
Go out.
Get customers first.
If you can build an audience, again, this is one of the reasons.
If you haven't signed up for my blogging course, one of the best ways to become an entrepreneur,
sign up for that blogging course, by the way.
It's free.
One of the best ways to become an entrepreneur is to build an audience.
If you build a blog and you get an audience around an idea, you've got automatic customers.
I've got my Simple Programmer T-shirt on.
I couldn't just launch a T-shirt business and sell this shirt.
I mean how would that even work?
Think about that, but think about how easy it is for me to sell this Simple Programmer
shirt, which, by the way, if you want one, click on me and you can get on, but think
about how much easier it is for me to sell this shirt when I have 70,000 YouTube subscribers
or I have 500,000 people that visit my blog everyday—or not every day, every month.
That's a lot.
That's a lot of people that are visiting the blog or YouTube channel and that makes it
super easy.
I've got customers.
I don’t have to spend a bunch of money on marketing.
I could spend money on marketing, that's true, but that's what you want to really think about.
I would just want to shift your mindset from this whole idea of I'm going to spend a bunch
of money and build some software and then market that.
It doesn’t work that.
Instead, you've got to build the business from the ground up.
You got to find, first of all, a niche or customers that you're going to serve.
You got to make sure that they're going to pay you money and then you got to build the
smallest possible thing.
Start small, build that MVP, get that built out and sell that and make sure that you can
actually get money, and then scale up and then say, "Well, what would version 2 of the
software look like?
What if we actually increase this and added features?"
and we already even know that we have customers.
Or like I said, your other alternative is to build up an audience and then to sell something.
Through Simple Programmer, you can check out all the products that we sell at Simple Programmer
here, but we sell it to you, to our audience who trust us.
You trust me because you've been getting my advice.
You've been reading my blogpost.
You've been listening to these videos or podcasts.
So I've got the ability to build a business from that.
I'm not just going to spend a bunch of money on marketing trying to sell something.
None of my product would sell if I just spend money on marketing.
It wouldn’t make sense.
That's my advice for you.
I know that's probably not what you want to hear, but I want to save you a bunch of money
because I've seen it happen too many times.
I've seen entrepreneurs that want to get started and they have really good intentions, but
they spent a bunch of money building something and then they try to spend a bunch of money
marketing it and it doesn’t work.
Inbound marketing is the best kind of marketing if you can get that, but either way you've
got to have an idea that you've tested already and do that before you spend any kind of money.
All right, if you like this video, go ahead and click that Subscribe button below if you
haven’t already, and I'll talk to you next time.
Take care.