The best business I ever ran, started from a toy

Imagine two dudes in a shop, bored out of their minds, flying a little quadcopter into the garage door at about thirty miles an hour. That was Peter and I in 2013. All four propellers snapped, so we went looking for replacements. We couldn't find any, so we figured that was the end of the quadcopter.

Well, it wasn't. We went looking on Alibaba and found a supplier for cheap. We ordered five hundred sets for five hundred bucks, 'cause why not. We bagged them up, one at a time with a label printer, and shipped them off to Amazon. That box turned into a thousand dollars and sold through in a month. So we ordered another box. Then another.

Nobody got rich, but it did pay for beer and nachos after work, and eventually a kegerator for the office. It was also the only thing the two of us ever picked that worked on the first try.

Everything we chose on purpose went nowhere. We researched categories, ran the margins, made a plan, and bought inventory that sat, indefinitely.

One of those experiments left a ton of dildos in a garage. On paper it was the most sensible idea we had: a category that was selling, a product people were already buying, and a supplier on Alibaba. Then the shipment landed and every box was printed in Chinese, so the two of us unpacked them by hand, cleaned them, and repackaged every one with a new insert. In the shop. We probably should have been wearing gloves.

We sold about six of them in a year.

Peter Coughlin, my partner in that business and the first guest on my podcast, moved the rest into a storage room at work. His mom found the box a while later, while she was helping him clear the space out. He told her it belonged to somebody else. She decided that somebody was into some really weird stuff, and the box went into a dumpster.

My research kept finding what was already there

Some of that is luck and I'm not going to pretend otherwise. But there's a difference I can describe, and it isn't luck.

With the propellers, I had the problem in my hands before I had the idea. I wasn't estimating whether the annoyance was real. I was already annoyed.

I'm making it smaller than it sounds. Nobody had to tell me the part was hard to find, and nobody had to guess how many people wanted one. I went looking for it myself and came up with nothing. Whatever a survey would call that, I'd already lived it.

With everything else, we were standing outside the market describing it. Demand looked fine on a spreadsheet. But the spreadsheet couldn't tell me how many other people were reading the same one, or that none of us actually cared about the product. That last part sounds soft and it isn't — we didn't care about it, so we never looked closely enough to find the thing that would have killed it.

My research would have never found propellers, and I don't think it could have. The part didn't exist as a product. Nobody was buying it, nobody was reviewing it, nobody was ranking for it.

Most research can only measure demand that's already there. Point it at a category and it gives you back the products already selling, the people already selling them, and the prices they've all settled on. That's exactly what mine kept giving me, in every category I pointed it at.

None of this proves that everyone with one of those toys needed propellers. It proves that enough of them did, which is all a five-hundred-dollar bet requires. I only knew to place the bet because I was the one holding the broken thing.

I get paid for research now

That's an awkward story for me to tell, because research is part of what I sell. A client hires me to look at their market, their customers and their goals, and to come back with something they can act on. I charge for it, on the strength of a decade in an agency and a couple of businesses of my own.

The strategy page on my own site says most strategy isn't strategy, it's regurgitated information. Somebody gathers the data, runs the workshops, sends the surveys, and hands the client back exactly what the client told them. I wrote that about other people. It describes a garage full of dildos just as well. We had the data. We had a plan. What we didn't have was one person in the room who had ever been annoyed by the product.

So the part worth paying for was never the collecting. It's whether anybody involved has felt the problem — and on a client's project, that person isn't me. It's them.

They live in the business every day. They hear the same complaint every week, they know which question makes a customer go quiet, and they can tell you what the thing costs to make without looking it up. They just don't think any of that counts as information, because it's ordinary to them.

My job is to pry it out of them and say what it means. The detail a client skips because they've already mentioned it once is usually where the whole thing turns.

None of that is a method I can sell you. You can't schedule being the customer, and telling someone to go get interested in something is useless advice.

What I have is a rule of thumb I trust more than I used to. When I catch myself annoyed by something I actually use, that's worth more of my attention than a category I picked because the numbers looked reasonable.

The numbers have been reasonable plenty of times. It's the broken propellers that paid for the kegerator.

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