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Comment by trapper | Hacker News Reader

There are some great companies built without a product. Often times you can fake sell before a product exists and give a refund to prove that a market exists before development. Otherwise all your product dev can be wasted.

I know successful (>10M revenue) companies who have mocked up a brochure and sold it this way. Their thought was "if they don't bring out a credit card right away you aren't solving a pain, you dont have a product".

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True, Microsoft is an example, Gates went out and bought what would become MS-DOS, AFTER he made the deal with IBM. However, this has to be looked at in context - he had the money to buy it from someone else.

Right, I remember reading something to that effect once . . . that event sort of proves both opposing opinions doesn't it? Yes, you can make money by selling vaporware, and yes, it is evil and abominable people/companies that do it (which is why I won't do it)

I wouldn't go as far as labeling it evil - as long as you have the resources and the "follow-through" to make vaporware into a real product. It took a significant amount of resourcefulness to land a deal with IBM, whether it was easy because of prior contacts, or hard-earned from the ground up, is notwithstanding. However, the final product was delivered, and the quality was good is most respects. But Gates' goal was not to build a product from the start, and Orian's goal was, which makes the situation quite different.

I think it is evil because it basically amounts to making a bet with other people's money . . . I realize that "what if" scenarios sound unrealistic at times, however . . . seriously, what if - in that particular case with Gates, for example - the product had turned out to have some major showstopping flaws?

Consumers/users ALWAYS get screwed in those type of scenarios. I don't believe in taking risks with other people's money.

When I said "fake sell" I was meaning using it to prove a market. The process is as follows:

1. Create mockup/demo/realistic brochure/non-functional physical prototype 2. Go to your target market. Count number of targets 3. Try to sell them the product at the target price 4. Once they hand over their credit card etc, just hand it back. 5. Tell them thanks very much for their support, but this was a test so you can make sure the market wants the product, if they want we can contact them when/if the product is ready. 6. Do your stats. What proportion of the target market you sampled bought the product. Extrapolate to the estimated population to get an idea of how many units you can sell. [rinse and repeat to make your product more attractive to the market]

It's the only way I have ever heard of turning a snake-oil, soothsayer business plan into one that can statistically show the uptake of your product in the market.

My, that's neat, wasting people's time with a marketing survey under the guise of an actual product offer.

Yeah. Your way wastes everyones time as the product isn't right from the start and it's harder to build a great business, as you don't know if you'll ever get paid. Everyone to their own though. I'd rather be sure.

Oh, "my way" involves solving the problem of "how to find out what users want" WITHOUT resorting to shady little tactics.

I refuse to believe that there is no other way of conducting a market study other than resorting to sneaky, dastardly little tactics. Why? because there ARE other ways.

Also, nice strawman, I obviously did not counter with "conduct NO market studies/surveys" - I came back with "that's dishonest and I don't believe in it".

Funny, how I have set up services (granted, not products) that made me money and I did not have to resort to cheap little deceptive tricks.

1. How can you be sure someone wants to pay for something unless they bring out their credit card? I would love to know a better way. 2. Is it unethical to sell a product that isn't right for the market, and promote half truths like most advertising does? Which is better in the long run?

I would rather have a product I can be statistically confident is going to sell because users have wanted to pay for it. There's no debating whether it's right for the market or not.

Thanks for the discussion by the way, this is fun :). If you do have a better way I'd love to know.

I keep trying to post a reply, and this app simply hangs and then displays a blank screen.

As I mentioned, finding out what the users want is a worthwhile problem in and of itself. There can be no one true formula, as not all scenarios are the same.

What has worked for me in the past (for the provision of services) has been a combination of becoming intimately acquainted with a process, and talking to people who carry out this process regularly, both with the intention of identifying where a need can be fulfilled. I am not talking about a bullet list of features to checkmark or cross out, that's junk, users don't LIE about a feature that they say they need and then don't, no, users simply do not know what they truly need a lot of the time, I don't focus on getting them to tell me a feature per se or a highly detailed aspect of the service I aim to provide them with (because what the hell do they know about the work I am doing, they know about the work they do, which is why I go to them) I focus on obtaining information and insight from them. I aim to give people what they need, as opposed to what they want . . . why? because if you just give them what they need, they will thank you for it later when they realize that this is what they needed, if you give them what they want, they will later realize that is not what they needed, but will not blame themselves for it, they will blame you.

Market surveys and market studies in many ways shapes and forms have been, are, and will continue to be used to great success, the problem with your variation is that it involves deception. You don't bs people and trick them into taking your marketing survey under the guise of a product offer.

I am seriously curious to know how many times you have seen that work. I would think that many people would resent the tactic and retaliate by not purchasing your product, or they would lose their trust in you (and rightly so, you done suckered them once) and therefore respect. It's interesting to note how many thousands of products have been researched, developed, and taken to market to great success, without deception tactics.

As for success, it was introduced to me by a very successful serial technology entrepreneur, investor & advisor with at least one personal 200M exit, and multiple smaller or similar size.

I guess we will agree to disagree on the ethics. I personally don't find it any different than deceptive advertising that is used in the majority of sales channels worldwide, the many deceptive claims of products overstating the benefits, understating negatives etc.

I see what you are saying about the widespread consumer deception, it is true, and yes - we can agree to disagree.

I simply refuse to do it because others are, and believe that successful market studies can be carried out without deceptive tactics.

This general attitude and outlook on my behalf actually mostly derives more from sheer pride than from any sort of assumed moral superiority - I simply can't sleep at night if I think that I applied or relied on anything other than my own merit to achieve something, and deceptive/slick tactics make me feel as though I cheated because I was unable to do it the hard way . . . that kind of thing.

I will close by conceding that I may be wrong about this, however, I might also just end up identifying more user needs in a highly accurate manner with my approach, which is conducive to even greater profits.

I had to break up my reply into several posts in order for this app to be able to handle it.

How dissapointing. I have seen PHP do better than this. This is depressing.

Well, I don't disagree that things can be done that way, but I do not think it is the right thing to do, for several reasons. Why learn to design/program just to pull a total suit move and sell vaporware/vaporproducts? If that is what you want to do, then just fake sell as you said, and then hire a few coders from India who can put whatever together for peanuts and then call that good (I would not be able to sleep at night ever after however). Also, those kinds of maneuvers are best left to suits - who are good at those kinds of things - instead of tech people, who are normally better at building things as opposed to pulling marketing maneuvers.

Even if you're a top-notch developer, it still takes an order of magnitude more time to develop an actual product than to put up a product description and a few mockups, and you can still expect 90% of your products to fail. You can easily spend years of development time on products that nobody wants. Why waste all that talent?

I had/have the same aversion to selling things that don't exist that you have. But honestly, I think that the next time I do a startup, I'm going to do it that way. I get really sick of speculatively building things that nobody wants. Why not make sure they want it first and then build it?

Plus, two of my favorite startups - DropBox and RescueTime - both used this approach (though perhaps with a little less dishonesty - they clearly marked it "demo"), and their products are better for it.

It will be worth your time. Its kind of like Stephen Key's approach, but more for technology/products.

Often times first thing I want to do is jump into code, and it's the last thing you should be doing. Proving the market is critical, and the only way you can prove it exists (for most companies) is to fake sell.

When people tell you, I would buy it if it had this feature, they are often lying. Unless they are willing to pony up their credit card, you haven't solved the problem imho.

I do see your point.

I think that the objective is a market study, for which I believe there are some tried and tested methods, although it occurs to me that in this field those may not apply as so many other things, however if that is the case, then I believe "how to find out what the users want without selling vaporware/other questionable tactics" is a worthwhile problem to tackle in and of itself.

Selling vaporware is to me similar to using users as unwitting beta testers, I don't believe in it, I think we should be upfront like the examples you cited: if it is a beta let people know, if it is vaporware, let people know, if it is a demo, let people know.

When I say fake sell I mean do the transaction then provide a refund.

In my opinion it's the ethical thing to do, not just for you but for your users. Why bother creating a product if it's never going to get traction in the market? You won't be able to afford to support it well, and it won't develop into a great business unless you get significant revenue. This is more unethical for the users, as you'll have to fold or let is stagnate. Why risk it?

Time is a valuable resource. Wasting people's time with a marketing survey under the guise of a product offer is not my idea of ethical. I would fly off the frickin' handle if someone wasted my time for me like that, using a deceptive little trick like that.

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