First Get Customers

First, Get Customers

Nate Peo

Devin Miller

The Inventive Journey

Podcast for Entrepreneurs

10/10/2020

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First, Get Customers

Get customers first. If you can find customers, you're going to find investment.

So many times, I talk with start-up founders, and they're like, "If could only get the money, if I could get 10 million dollars, I could build this thing and we could go get our customers."

In every pitch contest that you ever go to, if you ask any judge or anyone that does any judging, "Why did you pick the winner?" It's always "They had an existing customer base. They have already proven it was..."

So if you can go out and take your concept, and get customers around it, people willing to pay money for the idea that you have, you are far more likely to attract investment. You are far more likely to be able to grow your idea. You are far more likely to make it successful.


The Inventive Journey

Starting and growing a business is a journey. On The Inventive Journey, your host, Devin Miller walks with startups along their different journeys startups take to success (or failure). You also get to hear from featured guests, such as venture firms and angel investors, that provide insight on the paths to a successful inventive journey.

ai generated transcription

get customers first i think if you can find customers you're going to find investment and so many times um i talk with startup founders and they're like if i only can get the money if i can get 10 million dollars i can build this thing and we can go get our customers and every pitch contest you ever go to and if you ask any judge or you ask anybody that does why did you pick the winner it's always they had an existing customer base they had already proven it was so if you can go out and take your concept and get customers around it people willing to to pay money for the idea you have you are far more likely to attract invested you're far more likely to be able to grow your idea and you're far more likely to make it successful [Music] hey everyone this is devin miller here with another episode of the inventive journey i'm your host devin miller the serial entrepreneur that's built several businesses to uh seven and eight figure businesses as well as the founder and ceo miller ip law where we focus on have or focus on startups and small businesses and helping them with their patents and trademarks um today we have another great guest on the podcast uh his name is nate um and nathan and his appeal pam so nathan payo or nate payo and i'll give this a quick introduction so he uh worked in residential construction i think for about 15 years um had some successes a lot of failures kind of a mixture of both and then started to but also had an entrepreneur itch that he wanted to scratch and so made the transition from doing this the industrial network spent quite a long time building your network building uh the people in your circle so to speak and that will lead you to where you're at today and what you're doing so with that welcome on to the podcast nate thank you thank you for having me so i gave just a maybe a brief introduction of kind of what you do where you're at and where you got to where you're at today but maybe if you want to help us start with your journey and give us a bit more detail yeah no problem so i'm one of those people that um had an entrepreneur it not entrepreneurship itch for a lot of my life i think it started probably with reading the rich dad poor dad books and early in my career and i always had this like idea of creating a business um and doing something big with my life and throughout my journey i you know worked a nine-to-five job for many many years and i also tried some businesses and they've all had limited success um and ended up shutting them down but every time i know i'm jumping right into you sir but before you do so walking you're diving just a bit deeper into each of those so what was the nine to five and then what were some of the businesses that you started either successful and or failed but maybe dive in just a little bit deeper there okay yeah so i had i've been in real estate development construction related career most of my life um so my first business i started was a landscape business and and i had i guess visions of grandeur um that i could go out and create a business because i knew construction i knew how to do things um i knew how to build and i could just you know build this big business that would be very successful and what i think i've i learned early in that one is i created a job for myself and not really a business that was my first lesson is like hey you know sometimes a business makes sense and sometimes it doesn't this one it didn't because it just became a real time consuming effort just to kind of keep things afloat and somebody said earlier in on my businesses hey you can either be really really small in the construction trade or you can be really really big and really really small means you personally are doing the work and that's it that's as big as you are and then really big means you got you know hundreds of employees working for you and if you're kind of like anywhere in between you're not gonna do so good and that's where i was is right in between and a lot of it had to do with i didn't know how to run a business i didn't know how to put systems in place and i didn't really know how to sell have an idea have a differentiator it's just kind of this you know business it had nothing really to it nothing that stood apart from anybody else so i ended up shutting that down after about three years and then i went to back to work in the construction industry building houses and then me and my wife decided we were gonna start a business and we had this idea uh this would have been about 2010 but if you remember like there's an app called red laser and you could scan uh barcodes at the stores it would tell you like prices like if you're a target like a box of diapers might be 10 cents cheaper on amazon or tell you where to go to buy a little bit cheaper we had this idea of scan and wine labels um it would tell you like stuff about the wine like how do you know if this wine's any good if you'd like it what the ratings are what the reviews would be like so like hey let's let's create this business around that and at the time we didn't know anything about tech and we didn't know anything about how to build an app but we knew some people that knew how to build websites and after chatting with them and kind of going to them this path of nobody knowing what we were doing we realized like we didn't know how to build an app so we just kind of pivoted and created an online wine shop and again we ended up creating a business that was a job but it wasn't really anything um compelling or anything exciting or anything different about it that would be like hey we're really doing something cool in the space which is kind of like this me uh business that that competed on price and it wasn't really successful so that one because i think that's an interesting distinguishing is between a job versus the business right so how do you kind of separate my ma they're in your mind the difference and how did you kind of come to the realization that these are jobs on businesses and make that shift because i think that there's a lot of a lot of truth to that um to me a lot of the difference between a job and a business is can the business be systematized that it has a chance to scale and it can be um not as dependent on you operating within it every day like sure you're going to run a business you need to be the ceo of the business but if your whole business revolves around whether or not you are there and if you're not there for a day the business doesn't really perform then you have a job so i in this case there are always such a small scale operation that to to bring on the right amount of people to scale up to a business we didn't we didn't have the resources to bring them on so we could never make the leap and i think a lot of businesses get stuck in that idea of like you have this idea that you're just gonna go run around and constantly feed the machine and you'll just constantly get revenue coming in but then whatever comes out just goes right back into um paying your bills and and and and paying yourself a little bit of wages but you're never really able to grow your neighborhood really scale and you're never really able to put like systems in place it kind of does things to make it more efficient and and businesses can be small or they can't be big but jobs tend to always come you know to cap out of what you're personally capable of doing because you can't get any bigger than what you have time to do within a day so that would be my take on it no i think that's an interesting take so one i'm gonna ask a follow-up question on that so because it seems like you know hopefully a lot of times startups aren't they're typically attached to a founder or a set of founders right or founder and a co-founder and so that you know by that definition you almost start out as a job but then because you know it is dependent on you in the sense if you don't show up if you're the if you only have a few people on your team or a founder or co-founder you have to show up and if you don't then it you know goes under but if i were to put words in your mouth or so to speak it sounds like what you're saying is you need to have it as a business that you can grow scale and it goes into a place to where you're not no longer so dependent on you or to one individual but it's an actual business that runs and if you're not there as a day-to-day or if you're not always there doing everything it can go on without you or you can take you know the one that i always look or listen to and you know on business things is people say hey if you can take a month off of work and your business is still running without you then you built a business is that kind of what you're saying essentially like as as you are scaling a business your responsibilities maybe grow you're not doing the day-to-day work but you're still managing like the the strategy and the implementation and the growth and the the finances and stuff like that and i think you're looking at things in a bigger picture and i had a mentor and the way he he would describe it was similar to um what you described like take a month off and you say well a month off as a new business owner startup like that's probably not you know very likely going to happen but he had this thing it was it was like a thing of key performance indicators it basically gave you a temperature check of your business that if you were stranded on a deserted island and this was the only thing that was dropped to you by airmail every monday you could tell if your business was operating correctly or not and if it wasn't you'd have an idea of where to uh start you know pushing your focus so it might have things like your sales or might have things like your quotes going out or might have things like production rates whatever it was specific to your business but it would say like hey if if sales are down compared to where they're supposed to be they would give you an indication of like well maybe revenues would be down too because we're not getting enough quotes out or something like that we'll give you some ideas to go look at and to me that's signified what makes the difference between a business and a job is a job you probably don't have time to be tracking those things and do anything with them and a business you have them and you live and die by this system that tells you how your your your business is like a baby and it operates um independently of you but you're there to guide it and then the job is just like everything's like on fire and it's just you know just constantly putting out things you don't really know what's going on so it's hard for you to take a step back and look at are the systems in place whether or not it's just you in the sole proprietorship or sole founder role you still got systems you're tracking no i think that's a good distinguishing and nothing insightful so so as you did that now and you're saying okay so you've worked in residential construction for quite a period of time you did you know hot side hustles or startups and that alongside that successful failures and those type of things so how did you then because now you're in a different industry right you kind of you know i think when we talked a bit before the podcast you were you know you took i had the idea that hey i'm going to focus on my network build my network did that for a period of time so maybe if you can provide an insight how did you kind of say i'm going to shift or adjust where i'm at and how did you kind of land on that was the next very next phase of where you're going to go so it started off with this idea of like after you've you've done a business and shut a business down and done a business and shut a business down you start telling yourself i'm not i'm never doing that again like right i'm not gonna go down this path and do dumb dumb things again but if you're you know if you're entrepreneurial you do a lot of dumb things and you remember you forget those lessons and you go i want to try something else something bigger again so i was having this um itch coming up and i was like hmm i want to go start something but one i don't know what it is i don't have an idea and i didn't really want to go work for free to try to build something up and try to figure something out so i was like how else could i get involved in startup world without actually being a startup founder and i said well i could go into angel investing and i said okay how would you do that if if you wanted to get started and you'd never done that before and you didn't know a good company from a bad company so i said hey every time in my nine to five career if i didn't know how to do something i would always find people that did know how to do it and i would do that by networking i do that by going to the places that the people i needed to connect with were at so i could do the same for an angel investing i would go hey how do you get plugged in well there's startup founders probably hang out at incubators they probably hang out a pitch contest so i started finding out where those places were and i just you know called them up or sent emails to people i said hey i'm looking to be in a space i don't have a lot of experience in it but i do have knowledge and connections and can i uh donate my time to support the group and however way that might be and hopefully i'll learn some stuff along the way and so like yeah come on down you know and they start introducing you to different founders and different you know investors or different people within the space you're so you're basically leaving an industry you know and you're getting plugged into an ecosystem of of startups which is just another industry and if you don't know anybody you have to start networking and then the more you start showing up the more people you start meeting the more friends you start making and before you know it you're kind of plugged in and that's what i started doing and i guess the skills and the knowledge in the background i had around construction and the way uh the industry kind of uh functions clean tech made a lot of sense because a lot of the way that it's it's sold through the channels the people doing it it kind of has a related um industry because clean tech tends to go into construction but the way it's distributed kind of you know the same way the building materials get distributed so it just kind of started feeling like the right niche i started making more connections within that area and that's how i got started advising a few companies within the cleantech startup space so i'm going to ask one because i assume so take this hey i need to be where startups are i need to be where investors are i need to be where the where everybody's at that's where i need to figure out how to get to you in order to be successful but so the one question i guess two questions i have more than one um one is so did you go into that saying hey this is how i'm going to build my next business or might get my next idea or is it more of you know more of just hey i'm going to i need i know i need to be surrounded by these you know these people so when i have that next idea when i have that next business i have my network or kind of was it going in with the intention hey i'm going to build a business or i just want to expand my network so the next time i build a business now and i know it's hard to do a compound question man ask one more which is why you were doing that did you still keep the nine to five job did you take the period of time off or how did you make that transition um so the first part of your question it was more with the intention of like hey i want to be connected in the startup industry i don't have an idea i'm not there to to to build a business but i'm there to discover let's call it your voice it's just saying like hey where where can i fit in and you know you talk a lot of times we we bet on the founders not necessarily ideas sometimes right so sometimes you don't have to have the idea but if you want to get connected to the right people that you could brainstorm an idea or you could support in other ways or maybe you could you know leverage your expertise that they don't have or they could leverage your expertise their expertise that you don't have that's where it was i was just like hey i just need to go in this space and if i go there long enough i'm going to get connected to the right people so if you were expecting to like go get the next facebook to come knock on your door so if you want to invest in us that's not going to happen you have to go where those people are going to go they're maybe going to make you the introduction so i did it strictly to develop a network and um i did not quit my 9 to 5 job i did this purely on the side a lot of the stuff happens after hours or it's on weekends or you know whatever it could be somebody said hey you want to take a phone call i would take a phone call you want to meet somebody for lunch i'd go meet them for lunch you want to have a coffee and i was just very much whoever was offered as an introduction i was i was just like hey i'm i'm trying to learn and get plugged in and every bit regardless of the outcome of the of the meeting would be a bit of knowledge i would gain that i wouldn't have had otherwise so i just kind of just was very open-minded about trying to get as much connections as i could and just see where it took me no i think that that's interesting so then you did that and you said it for about a period of five years right over a period you kind of said you took about five years i think if i remember a conversation to build your network so then how did you leverage that or how did that transition to what you're doing now or how did that play out so you made you built that network you invested what would have been a lot a lot of time and effort over a long period of time and how did that you know how did that transition so it started off you know i was growing my network within the construction industry with more intention over the last five years like i had not i've kind of been casual about it prior to that i started building with more intention then when i started getting plugged into the startup space i was being very intentional about that but at the same time i didn't put two and two together so i was um you know thinking like okay i don't know um anything about coding but maybe i know how to do a business or maybe i know marketing or maybe i can fit this role in here or maybe i could help people with their pitches i was not quite sure where i would fit in but as i started getting connected to the the cleantech people i started realizing that the support they needed were hey did you know that your product would probably get sold in this fashion like it's not like a b2c type deal where you're gonna sell it on there that you're gonna sell through distributors and wholesalers and i know these people that represent products that are like yours they're compatible with yours so let me make some introductions here or hey do you know that there's codes being written right now that your product could influence how the codes are written and so let me introduce you to some people i know over here that know a lot of people in this code writing spot so what i started finding is my expertise was this network of people i had within the space of where they were trying to get their products into right so i was able to start bridging their introduce so they were getting me introduced to the startup side of the world and i was getting them introduced to the places where they were going to find their customers and i was kind of helping them to navigate and it didn't really dawn on me that those two things were going to be related when i went into it but i think that's why it's important to be open-minded to just kind of like see where the journey takes you because you might not know where you're going to make the biggest impact and that might not be apparent to you right away and then you're going to make connections along the way that are going to be beneficial to to both sides of it oh no that makes perfect sense so now fast forwarding to today you've done all that you started to make those connections you've invested that time and effort where did where did that where did i land your day what are you up to today and how did that transition go for you um right now i'm still um working with my nine-to-five job and i'm still working with the cleantech startups i'm still trying to um grow their businesses i'm trying to be more intentional about finding other startups to work with and along the same lines in a sense of like a casual conversation that might turn into a more uh formal relationship so a lot of times it starts off with hey let's grab a coffee let's talk about what you're up to let's see if there's a fit let's see if there's advice or see if there's help that we can each usually do for each other and if it starts making sense and we just start looking at like hey what might an agreement be for for working together in an advisor role and then from there we take it and try to get people connected where they need to and help you know turn people their founders into ceos get them ready you know wherever they're in for their funding rounds like maybe they don't have any uh they're looking to get some seeds or maybe they got some seed they're looking to get to the next level is try to get them you know polished up and cleaned up the best possible way so that they're putting their best foot forward okay no it makes sense so so now that you're doing that and what's the next you take you know six months to a year type of a time frame you're saying is the intent hey i'm going to continue to build this out i'm going to get a new startup idea and i'm going to spin out i'm going to keep the nine to five or where do you see where do you kind of see that going because i think that that's for a lot of you know people that are entrepreneur minded they get caught in a bit of the cash 22 in the sense the nine to five job is something that provides that income it provides that stability and yet they want to do the entrepreneur they want to do their startup they want to do their own business they want to grow something that's their own rather than working for someone else and yet are you know hesitant to make the jump because you know you don't want to lose that stability you don't want to have you know no or go out and fail or you know put everything on you know that you built on the line so to speak so where do you know how do you make that balance and where do you see things headed for you so for me i i'm looking to um continue to advise first step is is to take something have an exit that's successful and then see where that like might land which might leverage the ability to continue advising uh as a like a full-time role and and give back and educate i'm not so certain i'm going to be the one that's going to come up with this brilliant idea and be able to put in the 80 to 90 hours it takes to grow something but i think where i'm at in my life stage is i have a lot of knowledge to give back but i still have a lot of energy to grow something new so i see myself maybe moving more into a full-time angel investor role advisor role also creating some other maybe not necessarily start-up ideas but more coaching entrepreneurial stuff that could you know also fill in and support but be able to allow some freedom to to you know do the angel investing and the uh advisory full-time okay that makes sense so so now if you're the last question i always say last question i should really stop saying that i always have a whole bunch more questions but if you're to say take that and say now you have somebody that you know maybe wants to do the same thing they want to say hey i like my nine to five or i like the stability or want to keep going with that but i do want to be involved with startups or i want to be involved with small businesses i want to be whether it's an advisor or want to mentor want to be on the board or want to contribute maybe i'm not the guy that founds it but i want to be involved with them how do you what would be your advice to them or how would you start out making or setting yourself up to do that i would say it depends on what you want to accomplish right so if you said i want to i want to work my nine to five job but i want to be the startup founder or the ceo of the company there is going to come a point in your business where you can't do both right you're going to either have to um keep your nine to five and bring in some people to manage the business for you or you're going to have to leave your job and go manage the business so if if you want to be the ceo if you want to be the guy calling all the shots either going to have a side business a side hustle which is okay but if you want to grow a startup business it's going to take scale to grow and do you know big things and change the world you're going to have to uh transition that way but if you said hey look um i don't see myself uh going and working for a startup i don't see myself you know taking the risk but i want to support i think there's a good opportunity there to still advise through like mentorships advice through as an investor advice through like a syndicate you know those type of things to help people where they need help at and be able to get back and and lend a help because i think one of the things that i believe is the ecosystem surrounding a startup community is super super important right because you have people coming into your area where you live and they're trying to build businesses and if they build a successful business they're going to have um some influence in other you know they they build a business that says it's got like 200 300 450 people you know working there that's going to trigger other things in the economy people are going to want to live there there's going to be supports you know restaurants uh other services that support them but if there's not a good support of the ecosystem that business is going to leave and go with it so if you say hey i want to create this business but there's no investors here where are they going to go they're going to go someplace where the investors are they're going to go like you know the typical silicon valley but if they're the business is good then the investors will also come to that ecosystem and support it and so if you want to keep the ecosystem growing you have to have a mix of the the local community the governments and the stuff creating an ecosystem that's good and supportive for the to build businesses and attractive for investors to go into the the companies want to be there they need to have good businesses with good ideas or the investors aren't going to be there and if those good government policies are in place and the good businesses are there you need to be able to attract the investors to come into that area and and put money into them otherwise those things are going to leave without all three happening you're just going to have it's going to fizzle out and i think that's one thing that a lot a lot of towns and cities are trying to to build these ecosystems they're lacking one of the three um and they're all kind of interrelated to me no i think that makes perfect sense so now as we transition towards the end of the podcast unfortunately never have enough time to talk about all the topics that would be fun to talk about but i always have two questions i ask at the end of the podcast so the first question i always ask is so what was the worst business decision you ever made the worst business decision i ever made was probably taking our online wine shop into a brick and mortar location and we did not think through the location very well and that basically ate up all the cash very quickly and cash is king when it comes to the business and that's usually the reason why most businesses fail is you run out of cash and we just had a bad location and a a monthly rent payment that was due every month and it just you know it was a slow bleed dry no i think that's one that it's easy to it's easy to get excited over hey we got a new location and we gotta hey it's something tangible if we build it they will come type of a thing and yet you often you know you don't account for hey now when we build this we are now as you may we have a set burn we have to pay the rent we have to pay for the assets or for the stock and for everything else and sometimes if you don't do all that homework ahead of time you can set yourself up to where you burn through all the cash much more quickly and don't give yourself that runway in order to be successful so i think that's certainly a good lesson to learn so second question i always ask is so if now you're talking to a star or someone that's just getting into a startup or a small business what would be the one piece of advice you'd give them get customers first i think if you can find customers you're going to find investment and so many times i talk with startup founders and they're like if i only can get the money if i can get 10 million dollars i can build this thing and we can go get our customers and every pitch contest you ever go to and if you ask any judge or you ask anybody that does why did you pick the winner it's always they had an existing customer base they had already proven it was so if you can go out and take your concept and get customers around it people willing to to pay money for the idea you have you are far more likely to attract invested you're far more likely to be able to grow your idea and you're far more likely to make it successful so too many people get caught up in the idea and the development of the idea and then they'll go get customers i say no do it the other way take your idea go find customers and then find a way to build it because usually the building of it is pretty easy if you already got the people willing to pay for it it was the other way around you've invested a lot of money trying to get an idea off the ground then go find customers then you're struck because if they don't like what you're selling then you got something you dumped a bunch of money in that you can't do anything with no and i i completely agree with that and it's one that i had to we i've run businesses both ways you know both of them have been successful they're thinking this but i think that you know the ones that have been easier the ones that have been growing quicker the ones that you're less cash strapped the ones that you're having a much easier go but are the ones let's get that customer pipeline loaded earlier and you also get the feedback earlier right you get to hear what you as you're now developing it you can hear what the customers want or don't want or what's important to them and you can and then the last thing i think that with that is that you also get there they're buying right if they're now part of the process earlier on and as you're building it you're actually getting feedback from them they're much more likely when the time comes to pay for it or to be an active customer they're going to watch the product because they've already invested a lot been involved with it and they're excited about the product launch so i think that that's great advice and one oftentimes that people first think i'll build it and then i'll figure out how to sell it and why not get the customer so that as you're getting ready to sell you already have the base there so i think that's great advice well if people want to reach out to you and i know you have a podcast and you do other things and you do advising and whatnot what is the best way for people to reach out to you find out more about you or get involved easiest place is to go to my website natepayoh.com from there you can connect to the website you can connect to the podcast you can connect to all my social media and you can see everything i got going on right there so about to be the central hub nate payoh.com and that's just enter n-a-t-e and then p-e-r-p-e-o dot com right correct n-a-t-e-p-e-o dot com all right perfect well i certainly invite everybody to go to your website check you out connect up with you become listener of your podcast as well and everything else in between well thank you nate for coming on it's been a pleasure for those of you that are have your own inventive journey to tell your journey to tell make sure to apply to be a guest on the podcast at inventivejourneyguest.com and certainly if you're a listener make sure to click subscribe so you get notifications when this episode and all the other great future episodes air and lastly if you ever need help with patents and trademarks feel free to reach out to us at miller ip law we love helping startups and small businesses nate thank you again for coming on it's been a pleasure look forward to seeing how your journey goes and wish you even a better next leg of your journey even better than the last thank you so much for having me on you English (auto-generated)

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