Mission Often Matters More Than Monetization In An Early Market

Written by Sean Murphy. Posted in Rules of Thumb, skmurphy

Q: I am a newly minted entrepreneur who has been developing a technology product for an emerging market (state-legalized marijuana) that is proving especially hard to crack. I am a long-standing business strategist who understands and appreciates the imperatives of customer development, however have been very unsuccessful in getting business owners and consumers to open up about their issues regarding this stigmatized product and market. Would love to talk to you all about a potential engagement.

I have to apologize but we don’t really have any expertise that would be relevant to the business  that you are contemplating. I would not even know who to recommend that you talk to. I am sorry I cannot be more of more assistance, I wish you the best of luck in your entrepreneurial endeavors.

Q:  Thanks so much for your quick reply, it means a lot to me. I will beg a simple answer to one question however:  Did you pass based on what you described above truly, or was it really just that it was marijuana related and therefore risky and controversial? The reason I ask is that I'm running into brick walls at this point in generating founder support from what I used to believe was a strong network and personal brand, and wonder if it's even feasible to imagine a technology service for this market given it's baggage and the resistance I'm encountering.

It’s a consumer product with some regulatory issues: my answer would be the same whether it was a new alcoholic drink, a new cigarette, a new porn site, a new OTC medication (all of which we have been approached for in the last decade).

The physics of consumer markets is very different from the B2B markets that we normally help firms introduce new products into. And the regulatory uncertainty adds an additional overlay of complications. It’s beyond my skill and experience to help you and we don’t have any partners that do the kind of consumer marketing you would need.

My free advice would be to focus on one or more verticals where there was strong medical evidence of benefit (e.g. help folks on chemotherapy maintain appetite and manage nausea, help folks with HIV maintain appetite, etc…) where you can recruit based on a mission to help people. That may be a much smaller market than the recreational use but if I were trying to enter the market (with all of my B2B niche market biases) that is how I would approach it.

If I am not reasonably confident of being able to help a startup (e.g. two to one odds or better of offering at least useful insights if not helping them to land early paying customers) I don’t like to take their money. I am sorry I cannot be more helpful but we really only have expertise in a few market types and I try and focus on where I am confident of providing a good outcome.

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