When is a dumb idea a key ingredient in growing your business?
I had a great discussion Wednesday with Peter Rowan, formerly of Coinstar and Steve St. Clair of the Trouble Group. Peter related an awesome story about the power of seemingly dumb ideas.
When Jens Molbak was developing the idea for Coinstar in 1993 just about everyone thought it was a dumb idea.
Who would pay money to have their spare change turned back into cash – In other words, why would you pay to have your money turned back into your money?
But here is the key: Jens interviewed 1,500 people coming out of grocery stores over a period of weeks talking to them about their coin habits. He learned that just about everybody had a jar of change at home, and very few people ever did anything with it.
And they loved the idea of a machine in a very convenient place (like a grocery store) that would provide the service of easily turning that change back into cash.
From that dumb idea a company was formed that grew to over $1 billion in revenue in the space of 15 years.
Peter’s point: every idea pretty much starts out as a dumb idea. Taking the time to validate the idea with the market is what turns dumb into pure gold.
In addition to Dumb Ideas, we talked about two other key ingredients: Fear and Failure.
On Fear: “Play by your own rules. You decide what success looks like for you and if it doesn’t mean money, great. I think each of us as business owners have to define that for ourselves and even write it into your business plan. What does success look like for you? Measure yourself against that. Not the size of your house and car you drive.”
On Failure: “Most of the things people are afraid of are the unknown. It’s the darkness and that’s actually really easy to overcome. You just have to turn the light on and you have to shine a flashlight on it and have to just go and go and do something. The best way to deal with that is to actually just go do it.”
“When I ask the entrepreneurs that I work with what they’re most afraid of, the thing that comes up most of the time is they’re afraid to find out that their baby’s ugly. They have this beautiful idea for launching their business and they are perfecting it in their head or maybe in their computer or over coffee and, and what their biggest fear is finding out that nobody cares. The best way to deal with that is to actually just go do it, test it in the marketplace. Get feedback.”
On Dumb Ideas: “So you start with an idea, it’s a dumb idea unless you do something with it to turn it into a good idea. So you have to go out and talk to a hundred potential customers. Maybe they’ll say, “so why do I need that?” Think about the energy you’ve saved, finding out that way as opposed to finding out after you built the product or spent a bunch of money on some big marketing campaign.”
Find the replay here of the live video broadcast.
Or listen to the audio: