Tech Mind vs. Business Mind

I heard a great quote from a client running events over the past 25 years which went like this:

“You tech guys come up with cool ideas and try to find a way to make it work for the market.  [Putting his hands in the air and staring up at the ceiling] I start with who’s got the money and how can I take it from them!

When I first heard this from this person, I laughed because it is so true.  And since I have heard this quote I have repeated this quote to clients, friends at Caffeine Spaces and at Gold Coast Capital Ventures and everywhere I network at least once a week for the past 6 months!

Finally, after six months, I am finally sitting down and writing about this quote in my blog, because it has so many implications for programmers and kid entrepreneurs I meet with who want to start a small tech internet company and want to succeed but just can’t seem to get a tech start-up right.  And though it is not a hard and fast rule used in making decisions on what business to go in, determining the market potential is still the make or break point of deciding what business to go into.  Most of us techies just have a cool idea, but have no clue of the potential value of the concept or project and really don’t know who is willing to pay for it or what they are willing to pay for it.  Among the successful, there are those who figure this out right away and there are those are just get lucky being in the right place at the right time.  The right timers are the ones to watch out for, since they think they know something and the second time around is not always the same.

A Miniscule Market Inside Of A Tiny Market

Getting together for lunch with one of the founders of JDate about 6 weeks ago, we found some common ground discussing the issue of being in a start-up with a small market, and how this just limits what you are doing and that can kill the potential for investors.  It is important to choose your market wisely, and often techies don’t understand the market.  They just want to start coding.  For instance, the dating industry is generally speaking not the greatest sized market over all.  I am referring to market size by measuring how much revenue a year markets can produce.  I believe the dating industry is like a $2 billion dollar market a year globally (and though I use the word billion… it is not a good word when it comes to markets, because you never get 100% or even 10%, we are often lucky to get 2% market share).  E-commerce sales is $4 trillion a year globally and that market is terrific!  And if you were to create a Jewish dating site within the dating business, that will pretty much leave you with a $30 million dollar potential market size and basically 95% of that is already going to JDate, so what is your Total Addressable Market (the possible chances of a market)?  It’s really crap for creating THE next Jewish dating site since you will not unseat the leader  It could be a $5 million market, of which maybe you can capture 5%.  That is looking like $250k a year in revenue as your max potential and with an employee and a 40% margin… Get a real job.  It will pay more! Really not a place you want to go!

So, Why Do People Jump Into Crappy Markets?

This is where the tech mind overcomes the business mind!  I know, I have done it several times.  Techies and rational people get caught up in not the revenue size but the finesse of the project, how cool would it be to do x, y or z and either we have no marketing skills at all or we ignore the exit signs on the highway.  I guess we like to hear ourselves talk in the mirror about a cool technology or like to tell people what cool problem we will solve.  And yes tons of cool problems can be solved with tons of cool technical solutions, but the facts are the facts, market size is market size.  I had an MBA finance professor at Farleigh Dickinson in Madison, NJ who looked around the room and asked us what industry we worked in.  I was in Telco, and he said “maybe”.  Some people were school teachers, he shook his head no.  Stock broker, he shook his head no.  As soon as somebody said they worked in the pharmaceutical business he simply said, “I don’t care if you are going to be the bottom secretary, stay in that industry and you will retire rich…”  Point is, choose your market wisely.  Yachts and golfing are terrific markets for instance!

A Product In Search Of A Market

This is where tech guys and gals like me start.  We start with a cool thing and try to apply it to markets.  Stop right there!  Now, sometimes a cool invention or technology accidentally finds a market, but 90% of the time it does not.  Me thinks I can take a piece of web code in this market and shove it into that market.  I implore you to start over when it comes to your product, not just switch the website around or change the coding framework.  I have done this as well.  You have to start with the money each time you have a new product and figure out the market size, what they are willing to pay for it, what it is worth to the customer if at all, what the asset value you are creating is worth or what intangibles you are creating.  You see there is also the consideration of what your asset you will be creating and what that will be worth to a buyer, but we are not talking about customers now, we are talking about competitors and buyers of software companies!  Creating a tool that needs to be acquired by a Google or another company is another form of measuring the market before creating the technology.  In fact asset selling, not revenue is the number one way techies make it big.

The Socratic Within ME

Now I am going to reverse directions a bit and give you the upside of being a techie and start with technology and how you can figure out a path to the market.  Like a recent blog article I did on “Why I Don’t Really Know Anything” in the article How To Respond To New Ideas proves that there could be something within the techie cool thing you have been building that can be re-purposed for something real and marketable.  But you have to start from scratch in terms of the final product.  You simply have to match a problem you are solving with different markets, and switch the problem to a different market until you keep increasing the size of the market.  Now you may have to stay in a niche.  I recently met the founder of Veggidate (yes for vegetarians) and its small but that is a good niche to hide in.  So, let’s start again with the dating site.  So you still have not given up on the Jewish dating market.  You are determined, you are a programmer and you don’t listen well. Well, let’s either introduce your product in a new and growing market (mobile) or a new avenue (events) or a new methodology (education) and re-enter the market.  Because if you were able to conquer one of these three areas of markets that JDate site does not have ownership of, you would be able to get maybe a smidgen of a market, but more importantly, your company would be on the target list of successful businesses they are looking to buy along with a bunch of other people obsessed with serving a small market just because you like to…  But leave your expectation for financial success at the door.

 

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Setting Up * Wildcard Domains On WHM/Cpanel

Are you looking to set up a wildcard domain like x.example.com and  y.example.com and have every other iteration land right at the same home directory in your web hosting account?  Or let me be more specific, are you trying to set up a new sub domain that will appear no matter what you put in.  For instance you have set up the whatever.example.com and now you want to always have any new “text” in front of the domain but have them all go to a single directory like test.example.com?  And finally do you use WHM/Cpanel?

If you have landed on my blog to figure this mystery out, I am going to reference some other discussion boards and blogs that give you specific instructions, but I will take you step by step what I did to set this up for myself and clarify some of the smaller items.

As far as WHM Cpanel is concerned, I believe you need to manage WHM directly.  So if you are using Cpanel, you are not going to be able to do this without the hosting company or administrator getting involved.  And then you have to use either a unix command line or ftp to make the final changes typically as root access.  That’s because there will be changes necessary to the apache configuration and the Cpanel user does not have this level of access.  While I say that, there still may be some way of using .htaccess to do this as a hack, because .htaccess is an extension of apache httpd.conf.  But, it would be a total hack, and I don’t believe it can be done because the wildcard implementation requires a Virtual Host entry change that you can’t do yourself.

Here are the steps:

1. Configuring Apache for the wildcard

This is the most difficult part of setting up a wildcard implementation on WHM/Panel.  It took me a few attempts to get this right and figure out what appears to be some confusing and not so helpful information.  Start by getting to the apache configuration and reviewing the current httpd.conf file.  It will be located at /usr/local/apache/conf/ directory.  I use the Linux command line or shell to move around, but you could ftp in as root and move over to this directory and view the httpd.conf file.

You may or may need to set up the basic domain name as full Cpanel account first.  This will create the directory and account you want the visitors to see as your root directory, plus WHM Cpanel configures things nicely. So if your domain name was example.com you would create a new account for this domain with a new user.  This will at least get you ready and get you a directory with files.

This instructional link gave me some insight into what you can and can not do in WHM/Cpanel.

Specifically he mentioned that you can not edit the httpd.conf file directly.  If you do, and rebuild the apache config file, you WILL LOSE your changes.  Below is from the apache documentation on setting up virtual hosts.  Notice this line:

<VirtualHost *:80>
    # This first-listed virtual host is also the default for *:80
    ServerName example.com
    ServerAlias *.example.com 
    DocumentRoot /www/domain
</VirtualHost>

# DO NOT EDIT. AUTOMATICALLY GENERATED.  IF YOU NEED TO MAKE A CHANGE PLEASE USE THE INCLUDE FILES.

I of course ignored the warning on writing to apache httpd.conf directly and did 
write it to test things out. So, if you are looking to add an additional alias 
like a *.example.com you can test things in the original file, but be aware you 
will lose your changes.  

There are 2 situations I ran into for wildcard domain setups. The first is setting 
up a wildcard for a domain that you have already configured.  For the situation where 
the wildcard is for an existing domain you have to write to 

/usr/local/apache/conf/userdata/std/2/userexample/example.com/*.conf

You can add 

ServerAlias *.example.com 

into a file.  They recommended calling the file extra.conf, but basically all files in this 
../user/example/example.com/ directory will get included when apache is restarted.

For the user name or "userexample" that becomes the "Account" user name.  example.com 
becomes the directory.  Yes, you have to create this domain tree and directories.  
Use mkdir to do this.  I believe only ../userdata/ existed. I had to create the rest 
of the directories manually.

The second situation is where you want to add a completely new wildcard domain and point it to
a specific directory.

Notice these lines at the bottom of the httpd.conf:

Include “/usr/local/apache/conf/includes/post_virtualhost_global.conf”
Include “/usr/local/apache/conf/includes/post_virtualhost_2.conf”

You can write lines in these files like (match the IP address of the hosting account you are point to):

<VirtualHost xx.yy.zz.aa:80>
    ServerName www.example.com
    ServerAlias example.com 
    DocumentRoot /www/domain
</VirtualHost>

Either way, you have to think a little to do this type of wildcard implementation, especially
on WHM/Cpanel.  Restart apache on Whm once you have pointed the proper A record on DNS.

2. The DNS entry
So let's talk about the DSN record set up.  Let's say you use Godaddy for your DNS.  I 
don't, but that's not important. You go under the A record under DNS and make sure there
is a wildcard or "*" placed as the domain name, instead of an example.com or www.example.com.  
In fact you can just remove thee www.example.com if you are going to use a star.  If it 
is already set up, you are good.  If you need to set it up, just drop in a star instead
of the domain name.

Restart apache under WHM and good luck.

 

 

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