Who are you serving?

“The aim of marketing is to know and understand the customer so well that the product or service fits him and sells itself.” – Peter Drucker

Imagine you are 10-years-old and you got the idea of starting a bagel delivery route. You have the insight that you can make a bulk purchasing agreement with the bagel bakery in town – if you sell at least 60 dozen bagels, they'll give you 10 cents off each dozen and you will make $72 – not a bad haul for a few hours of work.

But there are two problems: How are you going to find your customers? How will you know what they want? If you can't identify them, then you're going to be sitting in your house with sixty dozen bagels going stale while you're waiting to deliver them. Worse, your product strategy will be based on a guess.

“Who’s it for?” And “What’s it for?”

“Who’s it for?” and “What’s it for?” are the questions that help you gain that understanding of the customer.

Who’s it for? Who are the people you want to serve?

What’s it for? What needs are you addressing for the people you are serving? What causes them pain? What delights them? What are they trying to get done? What are they working towards?

Answer these questions well and your success will only be limited by your execution. Answer these questions poorly, or avoid them all together, and everything else will be difficult.

Unfortunately, most people can’t tell you directly what they want or need. You need to infer and intuit from the things they say, their actions, and the trails that they leave behind.

Be Specific

The best way to ensure you creating something that other people will want – and pay for – is to pick a distinct initial set of customers to serve and learn from them.

Start out with a real set of people that you can identify and name, and with whom you can interact. Talk to them, watch them, learn from them: What do they need and want? What is their pain? What are they trying to get done?

Only when you understand the people you are serving can build a product or service that exactly meets their needs.

1,000/100 True Fans

The model we all grew up with was that bigger is better. Aim for the middle, homogenize your product, use brand marketing on cereal boxes and Saturday morning commercials, and think of everyone as a potential customer.

This approach is too expensive for those bootstrapping their business – and out of step in todays world.

In 2008, Kevin Kelly, proposed that a creator only needs 1,000 true fans who will pay him or her $100 each year for their work. “A true fan”, Kelly says, “is defined as a fan that will buy anything you produce.

There are two criteria to making this work: The first is you have to produce enough each year that you can earn on average $100 from each fan. The second is that you have to have a direct relationship with your fans.

Don’t get stuck on the numbers. Just know the number of fans you need is derived from the amount the fans will pay you each year and the amount you need to earn. Kelly explains,

The number 1,000 is not absolute. Its significance is in its rough order of magnitude — three orders less than a million. The actual number has to be adjusted for each person. If you are able to only earn $50 per year per true fan, then you need 2,000. (Likewise if you can sell $200 per year, you need only 500 true fans.) Or you may need only $75K per year to live on, so you adjust downward. Or if you are a duet, or have a partner, then you need to multiply by 2 to get 2,000 fans.

Early this year, Li Jin a partner at Andreessen Horowitz updated the idea and noted that all you really need now is 100 true fans.

Today, that idea is as salient as ever—but I propose taking it a step further. As the Passion Economy grows, more people are monetizing what they love. The global adoption of social platforms like Facebook and YouTube, the mainstreaming of the influencer model, and the rise of new creator tools has shifted the threshold for success. I believe that creators need to amass only 100 True Fans—not 1,000—paying them $1,000 a year, not $100. Today, creators can effectively make more money off fewer fans.

Sound unlikely? We’re already seeing this shift, according to creator platforms. On Patreon, the average initial pledge amount has increased 22 percent over the past two years. Since 2017, the share of new patrons paying more than $100 per month—or $1,200 per year—has grown 21 percent. On the online course platform Podia, the number of creators earning more than $1,000 in a month is growing 20 percent each month, while the average number of customers per creator is growing at a rate of 10 percent.

The Faberge Organic Shampoo commercial of the 80s parodied in Wayne’s World 2, describes perfectly the approach that works now (unless you have very, very deep pockets for research and development and brand marketing): Perfectly address the needs of your true fans, and they will tell others.

Rather than aiming for the middle, it makes much more sense now to aim for the edges. The people who love what you do and need what you offer. Niche down far enough that your ideas resonate with a particular set of people.

The rewards today go to those who choose.

Get out of your head

One of the things I love about rock climbing is that you are constantly working new “problems” – routes you haven’t successfully climbed before. When I am climbing frequently on problems at the upper edge of my ability level, I start working through those problems even in my dreams.

It is always easy in dreams. You have the strength. Your limbs stretch. You find the right movements.

In our minds, everything works and everything makes sense. We all think people will love our ideas and that things will work in the real world they way they do in our heads and on paper.

The success of your business depends on getting out of your head as soon as you can. Talk to other people about your idea. Seek peer review. State your assertion. Test your hypothesis.

You are not your customer.

You are not your customers” is one of the core organizing ideas of The Business Design Studio. It’s what makes the studio different.

Yes, there is instructional content. Yes, there are learning prompts and projects designed to help you design your business. But the key is the work you do with your cohort, the peer review you receive, and your reflections on the feedback and learning.

All of this is designed to help you get out of your head as quickly as possible. So that you can find your customers, understand their needs, and design solutions that meet their needs. Create value for yourself by creating value for the people you serve.

Learn by doing. Solicit and incorporate feedback. Repeat, repeat, repeat.

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Are you taking your ideas seriously?

The comedian Sarah Cooper has “suddenly” blown up. As recently as 2014 she was still “aspiring”, but now – six years later – she has published two popular books, has 148k subscribers to her YouTube Channel, has been name checked by Jerry Seinfeld, and been credited with being one of the few people who has figured out how to satirize President Trump.

She told her story on The Product Breakfast Club Podcast in 2018. The interview was rebroadcast recently on the Jake and Jonathan Podcast.

The first step of Sarah’s big break came in 2007. She was in a meeting at Yahoo when a manager got up and drew a Venn Diagram on a whiteboard that made no sense and had nothing to do with what they had been discussing. She wrote in her notebook, “how to look smart in a meeting, draw a Venn Diagram.”

Seven years later, “after leaving Yahoo, becoming an actress, going broke, and then joining Google (because she needed money)”, she came across the notebook. She decided to make a blog post out of her 2014 note called “10 tricks to appear smart during meetings” and put it online. It took off – within a week it had a million views. She was on her way.

During his interview, Jake asked whether Sarah thought it would have been better to write her post in 2007 instead of waiting seven years. Her response resonated deeply with me. Here’s what she had to say:

Looking back I had so many ideas, you know, I have so many notebooks with all these random ideas. (Finding the notebook) was kind of a moment of, wow, there's a lot of things that I think of and I create that I don't take seriously enough to share and I don't take seriously enough to do something with.

And I think that it was kind of a revelation for me and that there's probably lots of missed opportunities every day that we all have that we never really pursue.

Ideas are powerful. Innovation comes from the edges – when someone doing the work recognizes a better way. Change happens when we stand up and act.

We need your ideas. We need the changes you see. Are you ready to get started?

Decide what you are not going to do – for now

When you are starting a business, knowing what you are not going to do is as important as knowing what you will do.

You have a vision of a better future. If successful, you will impact others. Once you live in the possibility of your vision you are going to want to go big. It will be grand – it has to be grand to keep you going. 


It is crucial to keep your focus narrow at the beginning – on the smallest problem that you can solve that will bring value to the smallest set of people that will allow you to be successful. And then grow incrementally.

Being specific about what you are going to do now helps keep you grounded. Saying, “later” helps you preserve your focus and resources.

Announcing the Beta Session of The Business Design Studio

Have you ever said:
“I have a great idea for a business!” But thought, “I don’t know how to build it, launch it, or monetize it.” And then, stuck it in a drawer and forgot about it?

I would like to invite you to join the beta session of The Business Design Lab - a two month, online, small cohort, business design workshop to help new entrepreneurs launch their business. Because this is the first time I have taught the Business Design Studio online, I’m offering a limited “beta version” for a smaller audience at a significantly reduced fee.

You can find full details here.

Move half an inch in any direction and the world changes

Rock climbing is one of my favorite things to do, and one of the best ways I know of understanding what is required now. If you are pushing yourself hard enough, there comes a moment in every climb where you are stuck. You are standing on a nub of granite the size of an edge of a dime looking up at a big wall. The ground is far below. There is no obvious next move. You start to panic. Your leg starts to shake. You are going to fall.

But here’s the thing: if you can move half an inch in any direction the world changes.

We are all now standing on the edge. We can’t see anywhere to go. We are afraid.

Take a step.

You have an idea for how to make things better. You can see a connection that other’s haven’t yet made. You have the passion.

I know, the resistance is strong. You doubt your ability. You worry that others won’t value your contribution. You don’t know where to begin.

Here’s a suggestion: start by encapsulating your idea in a one-sentence problem statement with this form:

Create a [the form of the thing to be designed]

to enable [the people encountering the problem]

to achieve [their goal]

when [the situations they encounter the problem]

The one-sentence problem statement helps you focus on a very clearly defined goal. The goal might be wrong or might change, but it gives you a target. I recently used the one-sentence problem statement to solve a problem at home.

Every Saturday night my kids meet a group of other pre-adolescents at the local comic book store to play Magic: The Gathering. They get a taste of freedom. They get independence. They get camaraderie. They get to test themselves against their peers. They love this game.

The first Saturday night they couldn't go to the Magic draft they realized that the shut-in was going to be long and potentially painful. We had a problem to solve: how to play a physical card game with people in distant locations. We took it as a challenge and stated a one-sentence problem statement:

Create a [toolkit]

to enable [adolescents]

[to play in person card games]

[while confined to their own homes].

In this case, I added an additional sentence to define the constraints:

Using only the tools and parts that are already available in our house.

We solved the problem with an eight-year-old document camera I had for doing remote collaborative design, an old laptop, a few spring loaded clamps, and a zoom call. Their friends on the other end hung an iPad off the edge of their kitchen table and set their cards on the floor underneath. Success.

This one innovation has made the quarantine so much easier for them, and as a result, for us. The problem now is how to get them to BE QUIET while they are playing.

We are all adapting. There are new problems to solve and, as a result, many new opportunities.

Take a step. We are all counting on you. The world will change when you do.

You can have the business you’ve imagined

In the mid-1950’s my grandfather, Zit Levan, received a call from a friend inviting him to move from Brooklyn, New York to Miami, Florida to partner in a new pest control business. He answered the call, and moved – leaving behind my grandmother, father, and uncle. He started Vanguard Pest Control, and brought the rest of the family down a year later.

25 years later, my grandfather retired and my uncle took over the business. As the business was growing, they moved to a new building. At that time, phone numbers were associated with physical locations and the phone number didn’t change just because the business at that location did. As soon as they arrived, the phone started ringing for the travel agency that had been the prior tenants.

What to do? The phone is ringing for the prior business. It’s distracting, annoying, and persistent. My grandfather, recognizing an opportunity answered the call. He and my grandmother got licensed as travel agents and spent the next 30 years booking and leading tours around the world.

The phone is ringing, can you hear it?

It’s there in the back of your mind. In your gut. In the kernel of an idea that you have been nurturing for a while. In the “what if” you have been thinking about. In the little change you can see making to the industry that you are in. In the service you can see offering in your community. In the improvement you can see making in your world.

Now is the time.

“Now”, you ask? “When the whole world is shutting down? Why would you start a business now?”

It’s true. It seems like the whole world is on fire. Where everyone you know has been furloughed. Where half of the entire world is under a shelter in place order. Why would you start a business now?

Well, the fact is fires are incredibly transformative. Forest fires provide the heat necessary to clear away the dead underbrush and crack open the new seeds. Come back to a field where a forest fire has happened a year later and you will find tons of new growth and activity.

Answer the Call. Plant a seed now.

“But how,” you say? “I don’t know how to launch my business or I would have already done it.”

It has never been easier.

We have all the tools we need to go in days or weeks from idea to market validation to paying customers. The hard things are figuring out the right problems to solve for the right set of customers and finding the best possible solutions.

To find the answers, ask the right questions:

• What’s the problem you are solving?

• Who has the problem?

• In what situations do they encounter the problem?

• What are their goals in those situations?

• Who has already solved parts of the problem?

• What learnings can you extract from their solutions?

• How can you combine those learnings into a new solution?

• How can you test, validate, and improve your solution.

• How do you launch and spread your idea?

• How do you make your solution great?

• How do you create an achievable plan to get to launch?

You can make the change you imagine. You can have the business you want.

Start today.