Kevin Maloney – You Don’t Have a Product Until You Get Paying Customers

Kevin Maloney is a serial entrepreneur with 20+ years of experience in business development, marketing, operations, and finance with early to the mid-stage consumer, media, technology, and real estate companies.He has led more than 1,000+ early mid-stage investor presentations, conducted 100+ corporate and institutional roadshows, and raised more than $90M+ in capital for a dozen early-stage companies. “It doesn’t matter what you or your science team think. Just innovate and iterate quickly based on customer feedback.”Kevin Maloney Worst investment everAt the age of 29, Kevin connected with some scientists working on a process to produce nanomaterials. These are very tiny metallic powders. Kevin saw the potential this technology had, so he raised $100,000 to support the development of this technology.Building one of a kind productKevin gathered the best of the best people in the industry to work on this product that would be a gamechanger. He also surrounded himself with the best mentors. The team went on to develop a high-class product.Kevin raised the first amount of capital, proved the concept, filed patents, and launched his product in 2003. Then he started engaging with a few large potential partners and potential early customers.Struggling to get paying customers for his incredible productKevin believed that if you build an incredible product, then customers will come. He was so wrong. It was an uphill task to get customers to buy his product. Kevin had wanted to start engaging customers while the product was still an idea, but his scientists insisted that he waits until they had a finished product.Kevin missed Energizer’s opportunity to engage and commit to his project because he waited to have a finished product.No money, no businessKevin’s product was not bringing in any substantial income, and he could barely raise enough capital to continue working on it. He was technically running an R&D company with great technology, looking for applications.Eventually, Kevin ran out of money. He had spent over $35 million on this project. He ended up selling the technology to a public company and got an offer for about $10 million in equity.Lessons learnedEngage customers as early as possibleEngage customers and get them to buy in as early as when your product is just a vision. Do not wait for a finished product to start engaging customers. The earlier you start doing it in your product development cycle, the better.It is easier to raise money on a passionate visionStart selling your product as soon as it is a vision; do not wait until you have a finished product. Selling a passionate vision that could change the world is less complicated than selling a ready product.When you have a ready product, people will only give you their money when they see you have paying customers. So sell your vision first to investors before you even come up with the product.You don’t have a business unless you start selling somethingServe your customer well with a great product or service, and they will pay you for it. If you want your business to be successful, make creating a sustainable customer base your focal focus.Andrew’s takeawaysGetting people to pay for your product is the hardest part of entrepreneurshipYou may have a perfect idea, employ the best team that develops the best product, but you cannot count yourself as a successful entrepreneur until you convince people to pay for your product.Actionable adviceWhen the opportunity to take your company public and raise money comes, take it.No. 1 goal for the next 12 monthsKevin’s number one goal for the next 12 months is to launch an indoor air quality, IoT sensor, and monitoring platform. He is also launching a program with his son to motivate kids, students, athletes, and entrepreneurs worldwide to hustle with grit.Parting words “Have fun, fail quickly and often. Engage your customer and get feedback from them.”Kevin Maloney [spp-transcript] Connect with Kevin MaloneyLinkedInAndrew’s booksHow to Start Building Your Wealth Investing in the Stock MarketMy Worst Investment Ever9 Valuation Mistakes and How to Avoid ThemTransform Your Business with Dr.Deming’s 14 PointsAndrew’s online programsValuation Master ClassHow to Start Building Your Wealth Investing in the Stock MarketFinance Made Ridiculously SimpleBecome a Great Presenter and Increase Your InfluenceTransform Your Business with Dr. Deming’s 14 PointsConnect with Andrew Stotz:astotz.comLinkedInFacebookInstagramTwitterYouTubeMy Worst Investment Ever Podcast