Time for a case study! To follow up on last week’s advice, Sell It Before You Build It, we’re turning to Chris Oltyan, founder and CEO of Rebric. After years of pivoting from building one product to another with no success, recently Chris found a client that needed a problem solved and secured a six-figure commitment — without building anything. Sorry for the spoiler, but I’ll let him fill in the details.
In 2016, there was a problem I thought needed to be solved. We wanted to make hiring easier, allowing companies to find a diverse and qualified pool of candidates without relying on resumes. So we came up with a tool, and spent the next two years, and $100,000, building it.
We thought we had something people wanted. In fact, we did have something people wanted. Unfortunately for us, those people had no ability or authority to pay for it. We had been talking to the wrong people, hiring managers, and the right people, HR departments, turned us down. They saw our tool as unnecessary at best, and, at worst, a threat to their jobs.
So, now what? While it would be easy to assume we were SOL (and sometimes, we certainly felt that way), one thing we did have was a highly-scalable, flexible system that could be useful for more than just hiring. We started exploring that, and after an AMA Day at Techstars with Western Union, we honed in on a problem altogether different — anti-money laundering compliance. Sexy, right?
It might sound sexier when I tell you that we now have seven signed LOIs, with plenty of cash up front and six-figure commitments when we deliver. And we didn’t build anything first.
While we had made many mistakes up to that point, we also had done a few things right. We had focused on sustainable development, and built a strong foundation that could easily shift to solve our new problems. While we had to take down a few walls, fundamentally, it’s the same technology.
Further, our new focus didn’t violate any of our company’s core beliefs and values, and in some ways added to and enhanced them. While we shifted the makeup of our employees, we were able to help them find a place, with us or elsewhere. Our investors saw our newfound traction, and traction cures all ills. And all of it was better than the alternative — packing up our bags and going home with nothing.
And, of course, there’s value in the lesson we learned. It’s not enough for a potential customer to show excitement or tell you they will buy your solution. We had plenty of those people. You have to take the next step and figure out how those people will pay for it. And then make them sign a contract that says so.
In many ways, selling a product is like selling a house. A person may want to buy it, say they will buy it, but if they’re not qualified for a mortgage, it will never become an actual sale.
And just like you would if you were building a house, you wait for the contract to be signed before you ever hammer a single nail.