An SOP for Testing a Startup Idea (ITS top 1%)

Interactive Transcript

spk_0 I'm Brian Squardato and this is the Idea to Startup Podcast brought to you by Tacklebox.

spk_0 We accelerate ideas into real companies through the Tacklebox membership and we think through

spk_0 Startup Strategy every Wednesday on the Idea to Startup Podcast.

spk_0 You're here because you're thinking about an idea, or you're ready to launch something,

spk_0 or you already launched something and you're running full steam ahead.

spk_0 We're here to help with the counterintuitive stuff.

spk_0 Onto it!

spk_0 Today, we have no time to waste.

spk_0 We're going to talk through a Startup idea while weaving in three things pros do.

spk_0 An amateur's don't.

spk_0 And despite one of my favorite things in life being biting off more than I can chew,

spk_0 this episode is a lot.

spk_0 It's maybe even more ambitious than my dog Ruby, who last week while we were hiking,

spk_0 tried to pick up and drag a full-size tree that fallen across the path.

spk_0 The thing was easily 8 inches in diameter and like 40 feet long.

spk_0 She obviously couldn't budge it, but she just stood there,

spk_0 tree in her mouth, refusing to move, looking at me with eyes saying,

spk_0 little help dad.

spk_0 I finally convinced her to leave, but about 100 yards down the path she turned,

spk_0 sprinted back to the tree with the urgency of someone in an 80's movie trying to tell

spk_0 their crush they were in love with them the whole time, right before they board a plane

spk_0 to Paris to start a new life.

spk_0 After starting the episode by saying we have no time to waste,

spk_0 I sure did waste the last 30 seconds of both of our lives,

spk_0 but I stand by it because the Paris joke made me laugh.

spk_0 Anyway, we've got pro things to get through today.

spk_0 Things are best entrepreneurs do that the others don't.

spk_0 The gap between pro and amateur is something I don't think people pay enough attention to.

spk_0 We approach lots of things like amateurs and then are surprised when we don't get pro results.

spk_0 This is especially true in the startup world mostly because it's unlikely you've ever seen

spk_0 a pro entrepreneur, so you don't know what that entails.

spk_0 Today, we'll show you what a pro looks like and we'll apply the pro tactics to a startup idea

spk_0 as we go. Ruby couldn't move that tree, but maybe we can.

spk_0 The idea we'll use today is controversial, maybe? I'm not sure, but we're all friends here.

spk_0 We'll get through it.

spk_0 Here's the email that spurred the pod with the writers okay, of course.

spk_0 Hey, love the show. Editors know I always feel like Mike Frances on the sports talk show

spk_0 when we get emails that start like this. I expect them to continue with something like

spk_0 Sal from Maronconcuma first time long time. Another very specific reference. Sorry, back to the email.

spk_0 I want to start a business next year, but I'm not totally set on an idea.

spk_0 There are two things converging that I think are interesting and I'd like to explore them.

spk_0 First, a big trend is that school in the US is broken. Colleges broken, pre-school is broken,

spk_0 it's all broken. Teachers are unhappy and underpaid and there aren't enough of them.

spk_0 I should know. I was one. College prices are exploding, despite tech making everything else in

spk_0 the world cheaper and we're lagging other countries in basically every educational metric.

spk_0 You say that when you start a business, you should look for people who have already changed

spk_0 their behavior rather than trying to convince people to change their behavior to start.

spk_0 So after a bunch of exploring, I've landed on a space within education, home schooling.

spk_0 It predictably ballooned during COVID, up 61% in 2020, but the number hasn't regressed as it's

spk_0 still up 51% over 2017. The uptick is driven by people who describe themselves as quote,

spk_0 very religious, but just 26% of people report having a great deal or a lot of trust in the state

spk_0 to educate their kids and are quote, open to alternatives. This is the lowest rate in 50 years,

spk_0 and it's not necessarily one or the other. Lots of people are homeschooling until kindergarten or

spk_0 middle school or creating pre-K groups that meet at one parent's house each week. As a next teacher,

spk_0 this is terrifying because teaching kids is hard and you should definitely be trained to do it,

spk_0 but I also think there's opportunity here. Creating a viable alternative might push policy and

spk_0 urgency with schools. As an ex-educator, I have ideas. And as you say, businesses should ride a wave,

spk_0 not try to create one. The other trend is obviously AI, chat GPT and all that. My thinking is an

spk_0 app that helps people homeschool their kids and subjects they aren't experts in. Dual-lingo is

spk_0 taught millions of people languages, so it's possible, right? I know this is an all babies or

spk_0 cute sort of thing, but I think it might be worth digging in on any thoughts. I do have thoughts,

spk_0 and right off the bat, I'll say my knee jerk reaction was to ignore the email. I am a product of

spk_0 public schools. I love public schools. And my initial bias is that homeschooling your kids is as

spk_0 much of a mistake as home doctoring them would be. But I've learned that whenever you have that sort

spk_0 of immediate reaction towards something, especially something you aren't really that familiar with,

spk_0 I've never met anyone homeschooled nor seen what that might look like. It's probably worth

spk_0 resisting the initial urge and exploring. If you have an immediate uncomfortable response,

spk_0 that means lots of people like you will have that same response, which means the idea might go

spk_0 under explored, which means opportunity, maybe. If that hadn't been enough, the final thought of

spk_0 the email roped me in. It said, quote, my goal is to get a promising idea by the end of next year.

spk_0 I've had ideas for years, but none ever seemed strong enough to pursue, but I think I'm just

spk_0 going to start. I'm sick of waiting. I like the homeschooling AI space, but I'm not married to it.

spk_0 My question is, if we fast forward to the end of the year, and I've been successful,

spk_0 I'm working on something worthwhile, and we work backwards from that point. What's the

spk_0 likeliest path to get there? What are the repeated activities I can do each week and month that

spk_0 will end up spinning out a good idea as a byproduct? And as you probably assumed, I have a full-time job.

spk_0 I'd like to leave it as soon as I can, but I'll be testing this before I quit.

spk_0 Now that is an awesome question. This person employed one of my favorite tactics,

spk_0 to tell the story of future you, then work backwards and find daily, weekly, monthly actions that

spk_0 are most likely to result in that story. Actions that can't help but result in that story.

spk_0 I want to learn Italian this year is way different from any year if I'm able to speak

spk_0 conversational Italian. What did my weeks probably have to look like to get there?

spk_0 And that is sneaky entrepreneur, Protactic Number One. To constantly be telling your future

spk_0 story, describing the state you want to reach, then working backwards from it. If I ask all of our best

spk_0 founders where they want to be in five years with their biggest dreams are, they can tell me.

spk_0 They've thought about it, and if I ask them to tie that vision back to the things they do on a

spk_0 daily, weekly, monthly basis, they can. They're doing the sorts of things that could lead to the outcome

spk_0 they want. But when you ask most people, probably 95% of people to tell you their big five-year dreams,

spk_0 they don't have an answer. And if they do, it's rare you can tie their current actions to that goal.

spk_0 The five-year goal will be ambitious. The daily actions would never lead to it. We float too much,

spk_0 and floating entrepreneurs aren't successful. I've spoken with a bunch of you over the past few

spk_0 months, and I know there are a lot of listeners in this exact place. You've got a loose idea,

spk_0 or a couple loose ideas. Nothing fully formed. Nothing you're totally married to. But you'd like to

spk_0 be fully working on an idea a year from now. And in five, you'd like to be running a successful

spk_0 business. This is the best time to start before you're ready, because the magic comes after you

spk_0 start out before. So, what do you do? Well, you build an SOP, of course, so that you can master

spk_0 the two things pros always master, repetition, and reflection. And we'll get to it. After a little

spk_0 smooth jazz. Idea to start up is brought to you by Tacklebox, an accelerator for people with

spk_0 ideas and full-time jobs. If you aren't sure what to do next, we've got a step-by-step process that's

spk_0 help people build tons of businesses worth lots of money. It's got 25 hours of content, examples,

spk_0 and templates all organized in the Type 7 block path. If you get stuck and need feedback,

spk_0 I meet with founders personally every other week to organize sprints and help with tactics and

spk_0 approach. If you get lonely, we've got a bunch of other founders building alongside you.

spk_0 They're talented and driven in all an absolute delight. I hand-picked each one.

spk_0 If that's interesting, apply at Get Tacklebox.com.

spk_0 SOPs

spk_0 There's a quote by molecular biologist Francis Crick, the DNA structure guy you've almost certainly

spk_0 heard of that I love. It goes quote, it is amateurs who have one big, bright, beautiful idea that

spk_0 they can never abandon. Professionals know that they have to produce theory after theory before

spk_0 they are likely to hit the jackpot. There's another quote I'll toss in here from our good friend

spk_0 Kunal Shah. Quote, practice without feedback only results in activity, not mastery. Both are true for

spk_0 startups. The way to end up with a great startup idea in a year is to test out lots of startup

spk_0 ideas during that year. It's not to make whatever idea you have now great. It's to search and

spk_0 recognize. So if our homeschooling friend tested out a new idea within the homeschooling space each

spk_0 month, in a year I'm confident he'd end up with a problem we're solving. Maybe that'd be the idea

spk_0 he tested out month four or month eleven, but most likely it'll be some combination. But if he puts

spk_0 in the type of effort he'd have the context necessary to make a decision. This is hard. Testing 10

spk_0 ideas in a year is a lot. You'd need a system that helps you close the feedback loop on those ideas

spk_0 or else you'd just wander around aimlessly like my son when he crawls into a room he hasn't seen

spk_0 before. You just found my claws at the other day and was blown away. He looked around like he was in

spk_0 Narnia. Unfortunately, this type of rigorous testing isn't in our homeschool friends or anyone's

spk_0 nature. No one has that type of perspective or patience. So when I thought about the skills

spk_0 this founder would need to end up with a good idea in a year, it came down to two. Repetition

spk_0 and reflection. Now let's talk about systems. A few weeks ago we talked about building systems to

spk_0 help you stay in the chaos world a little longer. And last week we talked about the systems and

spk_0 interior designer builds to automate her business. People freaked out particularly about the interior

spk_0 designer. They loved it. They emailed me lots of specific questions like should I get an air

spk_0 table yearly plan along with Zapier and Miro and Clavio or should I hire someone to help me build

spk_0 this or if I swap notion for air table is that still okay. This made me realize that I forgot

spk_0 step one of every system, the SOP. People hadn't learned how to scramble an egg and they were asking

spk_0 about models for sous vide. If you're in the corporate world you're probably familiar with SOPs or

spk_0 operating procedures. There are documents that tell you step by step how to do complex stuff.

spk_0 SOPs are painfully corporate. I know the squares who work at Deloitte just got very excited.

spk_0 Well you win this round squares because SOPs are magical. They allow you to offload process to

spk_0 someone new and have them operate as if they're seasoned. They create the conditions for consistent

spk_0 success. For entrepreneurs they're step one of your internal system. This might seem counterintuitive

spk_0 as a solo founder. Why create process when it's just you but this is the best time to do it. The

spk_0 return couldn't be higher repetition and reflection. I build SOPs for every process that anchors my

spk_0 business and my life. I build them for stuff in my home. HVAC making sounds better believe I've

spk_0 gotten SOP for it. Whenever I have to do anything more than twice I start building an SOP for it.

spk_0 This started with my old boss when I was doing venture stuff. On my first day he tossed me a

spk_0 pitch deck on my desk along with a printed out SOP that told me exactly how to read, evaluate,

spk_0 and write a one page summary for any new pitch deck. The top of the page had a goal listed.

spk_0 Determine if an in-person meeting is required. The SOP told me what numbers to pull out and how to

spk_0 calculate them if they weren't there. It gave me the location of reference material if I didn't

spk_0 understand a medical concept. I was given a list of all the companies we'd invested in in a

spk_0 description of what a conflict might look like. I was given a template for an email saying we'd like

spk_0 to schedule a meeting or that we were unfortunately passing and a template to send my results to my boss.

spk_0 These documents were ever evolving. If I ran into something the SOP didn't have an answer for,

spk_0 there was a line at the bottom teaching me how to add it. When someone knew was hired they were

spk_0 given a stack of SOPs which sounds constricting but it was actually freeing. I'd evaluate the deck

spk_0 through the lens of the firm's goals then give my opinion on it with that perspective in mind.

spk_0 I have an SOP for inbound emails from Tacklebox members that's linked to a database for all the

spk_0 questions I've answered for members since 2016. I find the relevant answer, make sure it's still my

spk_0 opinion, change or tweak the master if it isn't, and send. This helps me give the best possible

spk_0 answer in the fastest possible time. I've got a detailed SOP for writing a podcast and SOP for

spk_0 recording one in an SOP for dispensing it after it goes live. Once I feel good about the pieces of

spk_0 an SOP I automate them or I outsource them. Zapier, Fiverr, AirTable and EA they all come after

spk_0 the written SOP is executed manually a bunch. Once I'd edited the podcast a few times and I knew how I

spk_0 liked it I found a way to outsource that. That is what an SOP becomes, identification for the processes

spk_0 that need you to happen and clarity around the ones that can be taken off your plate. Back to SOPs

spk_0 for a friend trying to get an idea by the end of next year. But I would recommend for him and for

spk_0 anyone with similar ambitions is to start with an SOP for finding problems worth solving, to

spk_0 productize that process, to treat it like a professional. When I sent him this advice along with the SOP

spk_0 we're about to talk through he responded immediately pushing back on the problem piece. I get that

spk_0 problem is important he said but don't we have to be thinking in terms of solution to? I can't

spk_0 say the first step with our customers is understand their language, the terms they use to think about

spk_0 the problem, how they describe success after solving it the risks they see for changing behavior

spk_0 the influencers will be involved, a good problem drives everything. This is a big mistake our founders

spk_0 make, they think the language of their customer is solution based because it's just way more fun

spk_0 and easier that way entrepreneurs communicate that way. I build an app similar to do a lingo that

spk_0 will teach your kid fractions do you want it. But think about it in another context. If your car

spk_0 is sputtering and you drive by a billboard that says 50% off carburetors you'll keep on driving.

spk_0 But if the billboard says your car is sputtering and you aren't sure if it's serious you're going to

spk_0 pay attention. The more specific you are on problem description the more likely the conversion.

spk_0 Humans speak problem. Since everything is downstream of how well you can describe a problem someone

spk_0 wants to solve that is where we start. On to the specific SOP. Here's how you do it. Pull up a document,

spk_0 label it SOP for finding problems worth solving and create a goal. Maybe something like a one-month

spk_0 sprint to decide if the problem is worth a second month of testing. Next list your hypothesis.

spk_0 Something like I think X problem is and then one or a few of painful urgent expensive growing

spk_0 frequent and it's a problem that customers want a solution to. So for the math AI tool which

spk_0 she didn't have a name for but I'm calling fraction broncin because to the seven people who get

spk_0 that joke it's pretty good. The problem hypothesis might be quote parents can't help their kids with

spk_0 sixth grade and above math and they urgently need to find a way to do that. This problem language

spk_0 will obviously evolve as you speak with customers. Your honed problem language should eventually

spk_0 sound like a secret. Something like quote our customers can't teach seventh grade math because that

spk_0 introduces calculus in the series of books they use to help teach their kids K through sixth math

spk_0 ends at calculus or whatever. The more specific the language the more compelling but that'll come.

spk_0 I usually categorize my SOPs and the first chunk of this one is what I call speak the language.

spk_0 Step one for speak the language might be to speak to two dozen people that have a perspective on

spk_0 the problem. So for our friend people that are homeschooling their kids people building tools for

spk_0 people homeschooling their kids and probably some kids being homeschooled too. And this is where the

spk_0 magic of the SOP starts to kick in. Normally this would be an incredibly overwhelming moment but when

spk_0 you build the SOP you're thinking about building out the playbook something you can build process

spk_0 around and eventually get off your plate. So you might start with a list title do these five things

spk_0 on day one to get started with inbound. Here they are. Email to 25 friends who might be customers

spk_0 with an interview request with a link to a cold email template you've used in the past.

spk_0 LinkedIn message to 25 friends asking for an intro to their link to connection who might be a

spk_0 customer for a cold email with a template instructions on how to search friends friends on LinkedIn.

spk_0 A post on LinkedIn with a calendar link complete with template for posts on LinkedIn.

spk_0 Identify three niche channels and post in those with a link to a template and ways to find

spk_0 niche channels. Then finally maybe something like try one new creative thing specific to the idea

spk_0 and document it with a link to creative channels or inspiration for past attempts.

spk_0 As you detail the process you can see how it would be easy to start outsourcing chunks of this

spk_0 to fiber or how you could add an item specifically for fiber. Hire someone to send cold emails to

spk_0 250 customers say you could have a loom video showing the type of person you'd like to chat with

spk_0 and templates for the emails. You can also see how the customer will start to flesh itself out.

spk_0 Finding unique channels they'll be in is an exercise in customer acquisition. Speaking with people

spk_0 building tools for them helps you understand the competitive landscape. You can certainly add

spk_0 other tools early email tools to track open support from EA's whatever but even if you do all

spk_0 of this manually you'll still be off and running. The next section of the SOP might teach you what to

spk_0 do once someone schedules an interview. Could be a structure of questions a video on best practices

spk_0 or notes from the book the mom test or clips from idea to start up. Could be software used to record

spk_0 conversations a checklist to print out and keep handy while you run the interview that says

spk_0 something like quote you can't learn anything if you're talking at the top. A document to fill out

spk_0 right after the interview that asks a few questions how does the customer solve the problem now

spk_0 is it painful or an expensive frequent growing what's the solution now out of 10 when's the last time

spk_0 they change behavior who else is involved in decisions is this customer accessible do they have

spk_0 budget how would they describe success finally you might have a section on stakes given all the above

spk_0 for this customer what are the stakes what happens if the problem is solved and what happens if it

spk_0 isn't the stakes piece is an interesting one that gets overlooked but it's really the whole thing

spk_0 since the founder mentioned duo lingo I actually think it's a great example of stakes if you think

spk_0 about the business you might think the stakes are low it's a bunch of people trying to learn second

spk_0 third languages but duo lingo didn't start with that customer they started by teaching English to

spk_0 people who didn't live in the US the stakes for those people were huge if they learned English and

spk_0 were in the service industry this allowed them to work at a hotel which increased their salary

spk_0 overnight by 40 percent the founder of duo lingo said early on he considered teaching other skills

spk_0 math science coding but there wasn't a single bigger guaranteed step up for customers than learning

spk_0 English so they launched with language what are your stakes the final piece of the document might be

spk_0 picking one person you'd interviewed who best represented the problem at the top of the page

spk_0 the question might be about the stakes of the problem is an important urgent painful growing

spk_0 expensive with a customer overpay for a solution do you speak the problem language the great thing

spk_0 about SOPs is that the first iteration is going to stink and that's fine that's the point you've

spk_0 got to be bad before you're good but it helps create momentum and movement startups are like

spk_0 sharks and this type of reflective task creation is incredibly useful and easy to get feedback on

spk_0 if you send me an SOP I can easily give you feedback on it and if you want the SOP I just

spk_0 describe briefly fire an email to team at getaclebox.com I'll probably clean it up a bit and probably

spk_0 put it on our beehive to getaclebox.beehive.com reflection building the SOP repetition executing on it

spk_0 back to our friend we talked through this process and SOPs and he went off and built one for his

spk_0 problem search and right away he reached back out I spoke with 10 people he said and the hypothesis

spk_0 I had on my SOP to start makes absolutely zero sense I went in assuming they'd want to help

spk_0 their kids learn math but basically anyone I spoke with only cared about one of two things first

spk_0 interacting with other kids and second getting into college you think the college question would

spk_0 skew towards older homeschool kids but it actually didn't it seemed like parents that homeschooled

spk_0 their kids for logistical reasons were really worried about college if they kept homeschooling them

spk_0 what would that mean the other side were parents of younger kids trying to get them socialized

spk_0 finding teams for them to play on mostly these are two wildly different and both interesting

spk_0 avenues and neither was a stated reason on my SOP so what do I do well there we go we're thrashing

spk_0 around and finding stuff this is entrepreneurship step one is to reframe the problem and pop

spk_0 it into a new SOP step two is to go after the new problem or both of them if you'd like if you

spk_0 got the bandwidth the key was to reflect and adjust which brings us to our final pro tactic the startup

spk_0 journal I've mentioned this before on the pod maybe a year or so ago I've probably had more

spk_0 people reach out about it than anything else the startup journal is exactly what it sounds like

spk_0 a journal where you write about your startup but you should position it as if it were an informal

spk_0 letter to someone could be to your future self to an advisor to really anyone you want the point

spk_0 is to write out your decisions and the thinking behind them in real time how they made you feel

spk_0 things you got done and things you didn't why you didn't send the 25 emails your SOP told you

spk_0 just and yesterday people think procrastination is a work management problem but it's almost

spk_0 always an emotional one the startup journal will shake it all loose one of my favorite books is called

spk_0 journal of a novel by John Steinbeck he wrote it while he was writing east of Eden it was a daily

spk_0 letter to his editor composed after his main writing session that he never sent it discussed why he

spk_0 made certain decisions with the core book what made him nervous he'd scold himself in it for not

spk_0 taking more risks then praise himself the next day when he did the running journal of a hard thing

spk_0 is an extraordinary tool and you should do it reflection repetition tell your five-year story

spk_0 and connect it back to your daily weekly and monthly tasks and if you're curious the best ever

spk_0 run after someone in the airport scene that Ruby recreated running back to the tree she couldn't

spk_0 move is definitely from love actually when the kids sprints through the airport to say goodbye to

spk_0 the preposterously talented girl he has a crush on what a movie what a scene what a way to end the pod

spk_0 this was the idea to start podcast brought to you by tackle box if you have a startup idea in a

spk_0 full-time job head to get tacklebox.com and apply we'll get back to you in 72 hours you'll be

spk_0 working on your idea by the weekend have a great week

An SOP for Testing a Startup Idea (ITS top 1%)

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