Chapter 3


Constraints lead to creativity. Stick to what is truly essential on the way to building a solution for your first customer.

Every big idea was small first. If you don’t start small, if you can’t help people one by one, you will struggle to build a business around your idea. Leave your ego at the door, set aside your concerns about funding and software, and focus on your first customers, using your time and your expertise to solve real problems for real people.

Now that people know you, trust you, and perhaps even turn to you for expertise, it is time to start helping them in a systematic, repeatable way that allows for continuous improvement and iteration. As you fulfill the first customer cycle, document each part of the process so that with every consecutive customer you have a playbook. This document will be the true MVP of your business. I’m not talking about the minimum viable product that we’re all trying to build and to launch. I’m talking about the manual valuable process that precedes it and will be the foundation for the business you’re trying to build.

Methodically creating this manual valuable process and recording the steps you take to complete it will help you figure out what’s working and what isn’t. It will also help you discover if you’re making something that people actually need or will buy. Unfortunately, the English language does not have a word for this activity, so I made one up:

verb processize
1. to turn into a process:
After they tested it on their friends, they processized their recommendation system.

It really should be a word in the dictionary, because it is so important on the path to building a business the right way. Unfortunately many people miss this step, falter, and ultimately fail because they go straight from problem to product before learning exactly what and how to build. But processizing is a cheap, quick discovery process that is essential. “Creating a product is a process of discovery, not mere implementation. Technology is applied science,” Naval Ravikant says.

Without processization, you may think you know what the customer actually wants, maybe even because the customer has told you what they want, and maybe even what they would pay for. But until you get through the entire process of solving the customer’s problem and (ultimately) receiving payment, you won’t know what the customer wants and is willing to pay for. You need to solve one customer’s problem reasonably well, if imperfectly, before you can scale. If it works, great. If it doesn’t, you may realize you want to scale up, but your customers couldn’t care less. If that’s the case, you may want to consider a different idea.

Diagram with steps titled Develop Process, Refine, Perfect, Automate

To this day, processizing is a concept we employ over and over again at Gumroad. Everything I do is listed on a piece of paper that everyone in the company can access. When I go on vacation, someone else can take over my job. And if I get hit by a bus, the company doesn’t go under. Once you have this magic piece of paper, you can turn your process into a product. We don’t have to make up a new word for this, because it already exists: “productizing.”

Productizing simply means developing a process into something you can sell. In the processizing stage, you created a manual valuable process for yourself and built a system for working efficiently and effectively as you helped each individual customer. Now you are ready to productize, which means that you automate each individual task so that people can sign up, use, and pay for your product without you being involved. If processizing is how you scale a manual process, then productizing is how you go fully automatic. 

Now that you’re productizing, focus on your product doing just one thing (at first) and control the temptation to try to do everything at once . . . or to try to do it perfectly.

I ask myself four questions every time I want to build something new:

  1. Can I ship it in a weekend? The first iteration of most solutions can and should be prototyped in two to three days.
  2. Is it making my customers lives a little better?
  3. Is a customer willing to pay me for it? It’s important for the business to be profitable from day one, so creating something valuable enough for people to pay for is key.
  4. Can I get feedback quickly? Make sure that you’re building a product for people who can let you know if you’re doing a good job or not. The faster you get feedback, the faster you’ll build something truly valuable and worth paying for.

Note that there are no constraints around how pretty the product is or how well written the code is. That’s another reason to do as little as you possibly can: to be honest with yourself about how useful your product actually is. A product that is beautiful or has great marketing behind it may feel more useful than it actually is. But if your product is incredibly minimal and useful, and people look past the lack of polish and use it, you will know you are on to something.

Key Takeaways

  1. Refine a manual valuable process before building a minimum viable product.
  2. The faster the feedback loop you have with your customers, the faster you’ll get to a solution they will pay for. The fastest feedback loop will be one you have with yourself.
  3. Before you build anything at all, see how little you can get away with charging for. Even later, build only the things you need to build. Outsource the rest.
  4. I define “product-market fit” as having repeat customers who sign up and use your product on their own so that you can start to focus on outbound sales.

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Chapter 3