It was one of those Shark Tank moments: I was in front of this startup, in a converted warehouse office. They were all younger than me, the Millennial type. I could see also there was one older gentleman who seemed to be the one that pulled the strings here. So far this was a typical sales meeting, the kind I attend at least three times a week.
A brand new aspiring apparel business with big aspirations, a limited budget, and oversized confidence, they seemed so sure that their product was the next sliced bread. They were convinced that they had come up with something so new, light years ahead of the competition.
They told me they just needed a simple website as a showcase for their product. Something quick and easy. Why come up with a more in-depth strategy when your product is so awesome that it can practically do the talking, and sell itself?
Character of Failure
I started with my usual discovery questions trying to get a pulse of the business. I needed to know whether their hypothesis was correct or not. How do they plan to measure whether or not the launch is successful? What happens if during the first week of launching, we get no organic traffic? Did they have any contingency plan to handle the profit margin when sales go below minimum monthly orders?
They quickly snapped at me, saying that they already figured out the strategy and just need a company that can implement. Once the website is done, the gazillion dollars of sales will surely start flowing into the company bank account.
All this conviction on their part came after asking only handful of their own friends and family feedback, while having no experience launching a product in a digital dominated world.
I politely flipped down my computer, and started to prepare to leave with the words, "You don't need me, this is not what I do." Always remember that when you detect that a client or the work is not a good fit, you must follow your instinct and have the courage to walk away. I know it is a difficult thing—maybe it has been a while since you have been invited into a sales meeting. But always remember you are not losing money by walking away, you are saving your time for the right customers. The right customer typically shows up after many dead-end meetings with the wrong customers.
Ten months later, I found out that the business was closing down—after burning hundreds of thousands of dollars of investor money.
I asked myself why I could predict this, and came up with two sets of two words:
High Expectation and Low Patience
Amazon has been the darling of many new upstarts to copy. What works for Amazon has been blueprinted and recreated, albeit on a smaller scale, by many new e-commerce companies. Everyone wants to be the next Amazon. Here is the secret: It is going to take hard work, and time, to see the results.
Amazon copycats might have forgotten (or never realized) that the behemoth of today did not turn a profit for six years, and has always focused on the long-term over the short. Yet in companies that want to be the next Amazon, instead of focusing on the long-term, what I see over and over again is a mindset of high expectation and low patience.
With the market is so noisy and full of copycats, the rush to e-commerce has been full of people looking to make quick bucks with hackery, growth lying, and zero persistence.
Here is how it typically goes: A small brand with a product they are super excited about spends most of their time on product creation, design, and production. Digital marketing is almost an afterthought. When they finalize their production and are ready for sale, they are both tired and close to broke. In their quest to make money, they become desperate. This desperation drives them to resort to using a growth hacking technique, such as clickbait videos, buying tons of ads, or buying someone else's email list and then using their remaining money bombarding customers with Facebook or Instagram ads. They don't care if this will make their potential customers unhappy.
This is quite different from Amazon's stated philosophy of, "focus on the customers and everything else will fall into place."
Low Expectation and High Patience
I have worked with many startups in e-commerce, and over time discovered that the best formula for success is the one that has low expectation, high patience to figure it out.
A sales meeting with a "Low Expectation, High Patience" company executive team goes more like this: The team, which has learned from some past failures of the early days, opens up about what they have learned. Because they are aware of what they don't know, they are more open to new ideas and are willing to take risks for long-term growth if trust has been established.
This kind of team has learned from experience in the market that success will take some time. They want to carefully map their way to their goal, and avoid treacherous get-rich-quick schemes. Typically a team like this listens more, but can quickly sniff out pretenders.
My goal is always to move from a vendor to a trusted partner as quickly as possible. I do this by being brutally honest and transparent. I am not afraid to be a know-it-all if I actually know something. If I don't know, I say so. Only by being vulnerable can we connect and start trusting. Real respect is given to people who have done the thing, not those who talk the loudest or who boast the biggest unproven promises.
When the conversation goes from "what you (the vendor) can do to my sales" to "what we can do together to achieve common goals," that is a sign that we can really make something happen and achieve success. It is more "we" as a team, than "you" as the vendor.
Mindset Shift for Setting Long Term Goals
If, after reading this, you realized you are more in the High Expectation, Low Patience camp, work on flipping your perspective to the reverse: Low Expectation, High Patience. This mindset shift will serve you whether your goal is related to business success or to achieve a personal goal of your own.
Decide what you want, focus on it, experiment, and expect failure. Get beat up and rise up again and again. Be willing to take baby steps with endless patience to get there. You must have a humble heart and humility to say, "I am still figuring this one out."
Start today, start stupid, aim for one percent improvement. The results will add up in the long run.