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Peter Decaprio – Five Pieces of Advice for Entrepreneurs Starting Out Today

Peter DeCaprio

Today, anyone with a computer and internet connection can be an entrepreneur. With the right idea, people can turn their side project into a full-time job says Peter Decaprio. And many do: entrepreneurs and freelancers now make up one-third of the U.S. workforce.

However, while starting a business has never been easier, succeeding hasn’t gotten any easier. According to the U.S Census Bureau, around 75% of new businesses fail within five years — which means three out of four entrepreneurs are eventually back at square one

Of course, no two failures are the same; there are always unique reasons why start-ups do not thrive. But looking back on my own experiences founding two tech companies between 2012-2016, I have developed five pieces of advice that I now believe are critical to start-up success.

Let’s deep-dive into each one below.

1) Find your product-market fit

Simply put, your product will not succeed if it does not solve a problem, you can identify and deliver a solution for. This might not be the most insightful or fresh bit of advice, but it’s true nonetheless. You need to place an existing problem in the world today, and you have to prove people are willing to pay for solving this problem.

This means validating demand before building out features, which has become customary at tech companies these days with programs like Google Venture’s “Design Sprint.” Understanding who is willing to pay for your product is just as important as understanding how much they are willing to pay for it.

Peter Decaprio says many entrepreneurs get stuck designing the perfect solution instead of focusing on their customer and their problems. Once you have found your product-market fit, everything else becomes infinitely more manageable. If you can’t find a problem worth solving or don’t know who would pay for the solution, go back to the drawing board before building anything.

2) Think about your business model from day one…

One major mistake new entrepreneurs make is that they build applications without considering their monetization strategy says Peter Decaprio. This results in either an application that nobody will ever use once they realize it’s only free (or ad-supported) and not beneficial or a product that users are forced to pay for to get value.

Of course, there are exceptions to this rule. Some products might not be designed with a transparent business model in mind. But they solve their problem after gaining enough momentum and attention — think YouTube or Twitter. However, even in these cases, you can argue that the business model was still developing during the early days of growth. And even if it wasn’t planned from day one, someone eventually realized how much money could be made by running ads against the content produced on these platforms.

3) …but don’t plan your business model before you have built something users love

The most successful tech companies today have found alternative revenue streams once their initial applications were already well-established. Peter Decaprio says to think of how Facebook added advertisements to its news feed or the fact that Slack makes money without ever charging for access.

Start-up investors will always say you need to be thinking about your business model from day one. But they are one hundred percent incorrect. This is because it’s impossible to know what users want unless you first put something in front of them. See if they use it — a process known as “pivoting.”

While eventually figuring out a way to make money off your product is essential, do not worry about monetization before building something that people care about. You can constantly iterate on your approach after getting user feedback anyways. If done correctly, this process works seamlessly as you grow.

4) Never stop iterating – or letting others try to break your app

In the early days of any application, the best thing you can do is release it as soon as possible. Start getting feedback from real users. Iterate regularly based on their experiences and ask them what they love about your product and what could be improved. This process will help you identify bugs before they become a problem, make sure users know how to use your application, and allow you to find ways of increasing engagement.

Many entrepreneurs fail to realize this fact. They sit on an idea for months without putting something in front of potential customers. Because they are afraid that someone might steal their brilliant idea or because they are perfectionists ().

These entrepreneurs will say that it’s essential to make something users love before releasing an initial version, which is true. However, nobody will ever use it unless you launch it first, even if you build the perfect solution. If you wait too long, someone else might beat you to market. It does not matter how “polished” your product looks at the end of its development cycle. Nobody has time for applications that do nothing more than pop-up notifications — they want real value.

5) Hire people who know what they’re doing…

Every great business starts with great people — so if you can’t find them on your own, look elsewhere. I cannot stress this point enough because it is near impossible to be a successful entrepreneur. If your team does not have the right people on board. You need to hire talented engineers who can build your app. As fast as possible, marketers know how to grow a customer base. Designers who can make an application look appealing.

In addition, do not fall into the trap of thinking that you’re ” irreplaceable.” If you don’t take the initiative and show an interest in improving yourself (both professionally and personally), there’s no reason why someone else won’t eventually come along and replace you. The world is constantly changing, and only those willing to adapt will survive.