Breaking Free
How to Quit Your Job and Start Your Own Business
Stop trying to figure out how to get money from people!
In: Advice| Psychology By: Brian Armstrong
25 Oct 2008Instead, start asking how you can create value.
Most people get it backwards. They come up with a way to make money first, and then try to add the value in as an afterthought.
Do you see why this is putting the cart before the horse:
- I want to sell subscriptions to the “premium” content of my website. What do you think people would be willing to pay for?
- I’d like to write a book. What would be a marketable topic that people are interested in these days?
- We need to sell the next version of our operating system (*cough* vista *cough*). What features can we add in there so people will think it’s worth it?
When you think about making money first, it corrupts your ability to make the most valuable product because you’ve already decided your course of action. You never stop the ask, “is this even the best way to help people?”
One of the reasons I think Google is so successful is that, believe it or not, they don’t focus on making money. The most surprising thing I saw when I visited Google a few years back is that if you want to get approval to work on a new product there, you will NEVER be asked “how is this going to make money?” They really don’t care because they know if it actually does help people do something faster, easier, or in a less painful way then it will become popular. And there are numerous ways to monetize a popular product.
In fact, I was surprised that they even called them “products” because they had no plans to make money with them up front (“projects” probably would have been a better name).
Do you think that ever happens at traditional companies like GE, Ford, and Microsoft? Hell no. They are doing tons of market research, feasibility studies, price point analysis, and net present values to see if a product can make money.
The irony of it is that if you get the first part right and actually do create something that is valuable, the money part will take care of itself.
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Breaking Free is a blog for people who'd like to quit their 9-to-5, start their own business, and achieve financial freedom. It's written by web-entrepreneur Brian Armstrong. You can read more here »
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Caroline typing from home
October 27th, 2008 at 6:08 am
Can’t argue with that, every post I read they say get the traffic first then figure out how to monetize it. Also do something yuo are passionate about.
Brian Armstrong
October 27th, 2008 at 3:49 pm
Good point about the passionate part. Btw, Caroline what is your work at home job?
Dot Com Dud
October 30th, 2008 at 8:03 pm
Good advice but it’s still just a different approach to getting money from people. Even though Google didn’t monetise the actual products, they still made money from their ads etc. The value just becamse the ‘product’ that got people using Google services.
Brian Armstrong
October 31st, 2008 at 1:41 am
Yep, you definitely end up with a lot of money doing that. Ironically, by not focusing on it. Thanks for the comment, your first if I’m not mistaken?
Creer un site
November 2nd, 2008 at 6:57 pm
Sentences are also available in french from my experience :-)
People still see the web as a lazy eldorado with little required skills to make bug money… it is not… :-D
Brian Armstrong
November 3rd, 2008 at 3:50 pm
Yep, the get rich quick ideas never seem to work out…
caleb
November 14th, 2008 at 8:20 am
I’d be interested in hearing more about your visit to Google. Why did you go? How did you get in? What else did you see and learn from the experience?
Brian Armstrong
November 15th, 2008 at 9:04 pm
I thought about working there after college and they flew me there for an interview. I learned a lot even though I didn’t get the offer!
caleb
November 14th, 2008 at 8:33 am
Finding Value
Sorry for commenting so much, but you seem to have an uncannily clear perspective on a lot of things I’ve muddled over in the past.
Here’s another one I’d like to know your views on:
Finding Value. You spoke of creating value, but how do we FIND value? And conversely, helping others FIND your value? People are so good at search engine optimization these days, I can’t just Google “really good blog about becoming financially free” and actually get something that fits that description.
What you DO get is 733,000 results.
Google is great when you know exactly what you’re looking for.
But when you’re looking for “value”, you can’t just google “value”.
Do you have a technique you use to find “value” blogs and products? So far, I’ve used the “poke around” method.
I do have one theory that if a blogger recommends a hero blogger, and then THAT blogger recommends another hero blogger, you’ve found a value blog. I’ll call it the “3-degrees to value” theory.
Seth Godin was on to something with his “lens” theory, but I’ve yet to see “value” from it.
Brian Armstrong
November 15th, 2008 at 9:08 pm
No problem on the comments, comment away! Regarding finding value, I find Google to be quite good. Mostly because their algorithm does take into account how many other people are linking to you (which is a vote for you). They also take into account things like the # of rss subscribers I have here and things like that which give good indications of value. SEO can’t fake those.
But you’re right that it’s difficult to find real value in some other areas. You have to “poke around” forums, etc like you said. I think there will be some better solutions for that coming out next year which I’ll certainly post about.
caleb
November 14th, 2008 at 8:35 am
BTW,
I found your blog from a comment you made on Tim Ferriss’s blog…I think.
Brian Armstrong
November 15th, 2008 at 9:08 pm
Good to know, thanks!