We’ve been working on an integrated approach to startup formation and growth that’s designed as a have your cake and eat it too answer for founders looking to launch and succeed with limited resources. We call it the Frictionless Startup and it builds on ideas of the lean startup movement, the ultralight philosophy, and the muse business construct.
We all know fail fast, start often, get incremental proof, nail it and scale it… START. But, what’s the best way to do it and how can founders minimize risk and upfront costs?
We take the approach that when you can prove rabid customer demand in a compelling niche market vertical before you launch; launch using pay-as-you-go subscription services that scale in cost as you scale in revenue (and thereby embed the infrastructure you need to grow seamlessly); and create good margins using realistic customer acquisition costs… you have a Frictionless Startup.
We talk about how in this blog.
Whether you think you can, or you think you can’t—you’re right.
We launched the Musemaka Idea Challenge at the end of 2011 and ran it as a pay to enter startup contest for three months. It didn’t do what we wanted to do, so we changed it to free to enter — Why? Principally because we were getting expressions of interest from all around the world, but entries from only a slice of the world… Seemed to us that cost was likely a barrier and we decided to remove that barrier because we’re invested in the idea of running a World is Flat startup contest.
That said, there’s also the matter of promoting a worldwide contest and the costs associated with that. There was never going to be any profit in charging for the contest, but we wanted to run it efficiently and at least break even and that was tough to do while running campaigns on four continents.
Our bet is that free will promote itself a little better and our costs will actually be less by making it free and ponying up the prize money versus paying per click for a global marketing effort…
Now put that in you pipe…