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How to build a business in 7 days for under $500 [Day#3: The Pitch]

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So, you want to start a business but have no time or money? That’s no excuse, according to Sebastien Eckersley-Maslin.

In early 2010, serial entrepreneur Sebastien Eckersley-Maslin set himself a grand entrepreneurial challenge. In seven days, he would create a new business from scratch — from concept and branding to product development and launch.

And, to make things just that bit more tricky, he would do all this with a budget of only $500. For seven days, he blogged about his adventures (and misadventures). This is what happened.

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Entrepreneurs’ Challenge: Day #3

I had limited time and very limited funds, so how was I going to market AutoCarLog?

This question provoked heated discussions on the forums I was participating in. The answer? I couldn’t. With my limited resources and time spent in development, I had to get other people to do it for me. And importantly, I had to get them to do it for free.

The Pitch

“If you can’t explain it simply, you don’t understand it well enough.” — Albert Einstein

I couldn’t do anything without the ‘Pitch’. The pitch is a one liner that wins, gloves down, in the ring at Pitch Club. It’s how you sell your product or service to someone in an elevator when you only have 20 seconds of their uncomfortable attention. A pitch must address the value proposition by answering, ‘What is it and what’s in it for me?’

Here’s what I came up with:

AutoCarLog is the easiest way to maximise your taxable claim for car expenses, by logging every trip by mobile phone and automatically calculating your claimable amount.

Not perfect, but I could deliver it with passion and conviction and it explained what the service was and how customers would benefit.

Bulk buying power

I have learnt from experience (sometimes the hard way) that it is far easier to sell to one person buying many than to many people buying one.

‘But AutoCarLog is for the individual,’ I hear you say. ‘Who would want to buy this it in bulk?’

How about tax accountants? Could I convince professional bean-counters to refer my service for me?

Armed with my newly penned pitch, I picked up the phone and began calling the major players. After just six phone calls, I managed to get a meeting with the Managing Director of one, and an invitation to email a proposal to another. I made sure I spoke with the decision makers and they were all supportive of the idea.

The deal I proposed  was  that they would encourage their clients struggling with their car expenses to use my product and, in return, I would sign over half the signup fee.

The outcome, should my cunning plan yield results, would be thousands of voices around Australia promoting AutoCarLog for me. Brilliant.

Word of mouth

Latrine, startup in 7 days, entrepreneurs, anthill
Never miss an opportunity. A blackboard in the men’s urinal at the local.

Word of mouth advertising is one of the strongest forms of marketing, and it’s free. But it is also the hardest to drive — the best you can do is influence it.

The best way to influence word of mouth is to have an remarkable product and target the bottom line. I decided to offer AutoCarLog completely free if people referred the service to their friends. Sign three people up and pay nothing. No catches, no gimmicks, just a simple referral system. It worked for Amway.

Price point

Sell for too much and few will buy. Sell for too little and it will take a lot of sales to recoup costs. Setting the right price was my next challenge. I conducted a snappy market research survey by asking friends, accountants, my bank manager and everyone I spoke to on the phone, asking them two questions: ‘How much?’ and ‘How often?’

I settled on $39 for six months, $69 for one year ($5.75 a month), which in the words of my web savvy accountant was “chicken sh*t cheap”.

Value adds?

Finally, I had (what I thought) was a great idea to send all AutoCarLog’s customers a small business card size sticker with a quick ‘how-to guide’ to stick in their car somewhere — a reminder to update their log and explain how.

To save costs, I could print the first few out myself for less than $10. When I was pitching this idea to my partner (in life), she reminded me of an old episode of the ‘The Apprentice USA’ (Season 3, Episode 15) where contestant Tana spent hours putting Dazzlers (little sparkly jewels) on her limited edition t-shirts. She believed they would bring in a higher price. The truth is she would have been better off spending that time better marketing her product (without the dazzlers) and might not have lost that round as a result.

So while I love the idea of a sticker, it’s not going to bring in more customers. I need to focus on the core service and spend the time marketing that. (For now at least. I can always print them later!)

Right, now it’s time for some some nitty gritty development. Bring on day four!

One of Anthill Magazine’s inaugural 30under30 Award winners, Sebastien Eckersley-Maslin thrives on creating smart solutions to every-day problems. For the past decade, he has spent his time balancing the demands of a full time Naval career, a Masters in Engineering and running personal businesses.

In 2009, Eckersley-Maslin returned from duty in Iraq with a drive to storm the ‘front line’ of Australian business. In 2010, he was the subject of an international documentary, where he aspired to create the world’s smallest multinational.

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