Drew Houston is the founder and CEO of Dropbox, an online backup and storage service. Dropbox is valued at more than $10 billion (2015) and Drew has personal net worth of $1.3 billion. But everything was not so rosy back in 2007 when it was started.
Drew had the idea of creating a cloud based service for file sharing, when He repeatedly forgot his USB drive while travelling. As a first time entrepreneur He had very little knowledge of running business. He did not have any co-founder and was rejected by Y-combinator first time, due to being single founder.
He had to face many hardships over the period of time before Dropbox could become a success. From finding a co-founder to creating a minimum viable product (MVP) or to secure funds from venture capitalists, He overcame everything.
Almost every first time entrepreneur has to face similar challenges around the world.
So how to solve these problems when you are starting for the first time with little or no resources?
Simple, learn from the successful and do what they did and you will get same or similar results.
One of the most interesting thing which Drew Houston did to find his Co-founder and early adopters was to create a MVP product.
Drew knew from deep with in his heart that his idea had real need. There were many file sharing companies during that time. But almost all of them were doing a very bad job. They could not sync files across various devices seamlessly. There were issues with file transfers.
But without any funding or team, it was difficult to create good product. His idea required lot of technical effort. With no early traction, it was very difficult convincing VCs to fund him. He was rejected by almost every VC he met. He had to show them some real business value and market demand. Till that time, Dropbox was still in private beta and only 5000 people had signed up for the launch.
That’s when He did something, which no body had done before. He created a minimum viable product (MVP) which was essentially a demo video of what He had done so far and what He intended to build.
He created a 3 minute quick video to show the basic details of Dropbox and how it can solve user’s file sharing problem(s).
This video became an instant hit on various sites like HackerNews, Reddit and Digg. With in 24 hours, his beta sign up list went upto 75,000. He got an email from YCombinator founder, Paul Graham. He showed interest in funding him but insisted getting a co-founder on board.
That’s when his video again came handy. His future Co-founder and fellow MITian, Arash Ferdowsi had seen the demo video and was interested. After couple of discussion, Arash dropped out from MIT and came on board. And rest is history. After 8 years, Dropbox is now worth more than $10 billion.
Many first time entrepreneurs, do the same mistake again and again. They feel that their product has to be perfect before they launch it to customers. They have fear of rejection on showing half cooked features to their users.
On the contrary successful founders do the opposite, they try to connect with their users as early as possible. They get early feedback to refine their product.
They repeat this cycle until they know what will work and what not. They don’t shy away in changing course if they feel that their original idea will not work.
So releasing a minimum viable product or MVP will come a long way in determining your success.
Check the original demo video created by Drew for users.
Here is a great presentation by Drew on startup lessons that He had learned over time.