Latest / Pitch to Product / The Product Development Lifecycle EXPLAINED
Transcript
- Peter & Bobby 7-1-26 Podcast: All right, welcome to another ⁓ edition of the Pitch the Product Podcast. And I'm Peter. I'm Bobby. We got some important cue cards in our hands because I want to set the tone of what we do differently so that we can maybe stop answering this question repeatedly. Repeatedly. ⁓ we are not in the invention help space, right? Not one bit. Bobby, that's where you come from. That's where I came from. Okay. So that's what I want to clarify. And what's the difference between the invention help space and the manufacturing of product space from your experience now doing both? All an invention help space can do is try to sketch your product out, maybe do one prototype and then try to pitch it to companies to see if they like your product enough for them to invest into it. Correct. Very little success. Very, very little success. I've listed a bunch of questions here or a a lot of statements, right? So we're gonna say here's what the industry is going to tell you to do, right? And this is traditional, the way things have been doing been done in the invention help space, which we are not in. Not one bit. So what the industry tells you to do is number one, you know, you wake up, you gotta go protect the idea. And how much money can you spend on protecting idea, Bobby? First thing they try to do is sell you a patent. Right off the bat, sell you a patent. You don't even know what product you're protecting yet. They just want to sell your patent. Please understand patents are still a business. Right. They're charging you for it. Well, and look at there's good patent attorneys. We have a great group, right? And and patenting is definitely part of this process. But what do you think? Like I've seen patents that cost just for a regular patent is somewhere like fifteen to eighteen grand. Easily. Okay. And then if you want to do all the international patents and you want to have multiple versions of your patent all the addendums all the acts and but what you understand with a patent, if you file early, you're gonna do a lot of revisions. Yeah and scale down. Right. So I'm gonna say roughly, let's put an estimate to that. That that can cost somewhere between fifteen to thirty thousand dollars. Easily. Easily from beginning. And and do you simplest product. And what do you have at the end of this? A piece of paper. So is can you go with if if you get the patent? Right. And can you go sell that piece of paper to someone else? Not one bit. Okay. So have to develop So once you've spent that money, the next thing that they tell you to do is, well, if you could only go sketch your idea so I can understand it better. And look at in today's world, I don't think that's that that's very expensive, right? You want to sketch to iterate quickly. And I think actually AI can probably do a pretty decent job of that, correct? If you don't even come to us with a sketch already, you're not being realistic. It's free. Exactly. Would you pay would you pay someone to do a sketch? No. Not nowadays. You can and used to. Well, so can I ask, is it really part of the process? I think it is, right? Well, you want to be able to explain what your product looks like. What's the difference? So a sketch does help. Right. So they're they're right in actually saying, okay, well, can you get me a sketch next so I can see what you're talking about? And then when you get them the sketch, here's the next like trap. Okay, can you design something in a CAD model to give me a design so I can go show someone in a 3D like rendering, right? Understood. Yes. That's part of the sketching. And now it's detailing it. It now it's detailing the sketch. And look at a product designer that just that you can find on Upwork or some like free service, ⁓ or or some low cost service, that's fantastic. What are you getting in that design? The same thing you could probably do with ⁓ with CAD, same thing you could do with a ⁓ chat GPT. You you kind of get what you pay for. And but again, it is the next step. It is part of the process. So they're not no one's lying to you at this point, correct? No. What what could a design like what could a quick design cost you? Two, three thousand dollars, five thousand dollars? It could depends on ⁓ the inter intricacies of your product. Now detailing. Here's the thing that nobody tells you is that that design that you did is not designed for manufacturing. It's not fully designed for many not one bit. It actually might need might not even be designed for the next step, which someone now says, Okay, great, you you protected the idea, you showed me the idea in a sketch. You actually gave me some designs so now understand what you're trying to show me. Now they're gonna say, go get me a no yeah. Prototype. Right. Yeah, but no specifications on the artwork, nothing explaining the depth, nothing explaining what materials we're using. It doesn't give you details for a manufacturer who may be able to make it. I'm gonna ask you a question just off the top of your head. How many three D printers have you seen in the office? Here? Yeah. We have a thing six, seven. Right. Is that prototyping? Yes. Always going to. They're always going. Those things are twenty four seven. I seven I don't want to say I throw them out, but when they break down, I don't have time to fix them. I just get new ones, right? Like that's part of the process. I got a new one three days ago. Yeah, yeah. Thank you. You're absolutely right. ⁓ prototypes can cost you a ton of money if you're trying to replicate the exact idea you're doing. Yes. we had a young lady, and I could probably put the link in here, but she's got a very expensive prototype, and it's a very good step in the process, but Her challenge was now you spent a lot of money. I'm gonna say $15,000, $5,000 to $30,000. She spent $22,500. $22,500. $500. For a non-working prototype. So I hope somewhere along the way when this video gets edited, we can just keep a little cha-ching tally, cha-ching tally, cha-ching tally. Because I don't know what you're up to, but it sounds like you're over sixty thousand dollars at this point. On the low end. On the low end. Okay. So Now you get this amazing prototype in your hand, and what's the objection now that everyone tells you? Go sell it. And what do you go show it to an investor? Right. And what does that investor say? How many have you made? How much does it cost to make? Exactly. Right. So you you've you've missed the most important and critical aspects. I I swear to God, I I sometimes wonder most basic questions. When people watch Shark Tank, what are they watching? They don't understand the pre-steps to getting on the Shark Tank. Number one questions are what are your sales? How many have you sold? Right. And and so What's your cost of acquisition? What is your margins? Which means what did you spend for? So let's use margin calculation. What does the product cost you and what can you sell it for? Right? Because all the in between is you've got expenses that go along, but if you don't have margins. Margins the main word from the jump. Right. So the most important part of this process is ensuring that your product idea is has margins. If you can't make profit selling it, then you have nothing to sell. Yeah. And ⁓ here's not in business to give it away. If you actually don't have, let's say, let's say it costs you thirty dollars to sell and you can sell it for thirty dollars, and you have to spend thirty dollars to sell it, how much money are you losing per sale? You lost what it costs you to manufacture, plus you're just not even breaking even, you're losing money. So look at if anybody wants to take a quick stop and listen to this over and over and over, your margins is how you successfully launch products. If you don't have margin, you gotta go back to the drawing board and you gotta redo it so you have margins. your margins is how you successfully launch products. If you don't have margin, you gotta go back to the drawing board and you gotta redo it so you have margins. That is the only way you succeed. If you have a product that has margin from day one, you will succeed because day one, it's not one day. Day one, you will sell and be marginally profitable. That is the only way you succeed. If you have a product that has margin from day one, you will succeed because day one, it's not one day. Day one, you will sell and be marginally profitable. Then you got to go with the volume, and volume will increase that marginal profitability so you can do more. When you have volume margin, you have a successful business. It's the same with everything from being a roofer to having a kitchen. What you're paying for and what you're selling it for, those are your margins. That's what you have to make your so now when people hit the wall, right? They've spent ⁓ a prototype, you know, what do we say? Probably upwards of sixty, seventy thousand dollars at a minimum. Now the only course of action you can hope to do, because you're probably broke and you probably spent more money than your than your spouse and you guys thought about, or you borrowed money from a ⁓ now the only option you have is what they call is get you a license. Yes. And Bobby, you come from the licensing world. That was my world for twenty three years. And and You know, I'll let the industry speak for itself. If you want to ask the right question, act ask the question that is federally mandated. How many products have like when you go through the invention help process, what are the realistic expectations of success? And you will be shocked at the low, low, low, low number that you get. I love the fact that they have to by law give you the number. But when you look at the number, it is a low, low number of success. And I will people make money. And I will go one back ⁓ back one further. You're asking someone to invest. And bring that product, like pay to bring your idea. That's crazy to think about. So you're asking someone to pay to bring your idea to market. They either do or they don't. You that's a how long is that process? Two years, Bobby? One year easily, but it's also you're asking someone to invest into your dream. Your dream. Look at and and so this is this is where you know I'd say East Weets meets West. This is where Bobby meets meets 52 launch, and 52 launch meets the inventor process, right? The one thing that people came to us is that. After two years, they were so worn out, so not even frustrated because they understood now what they paid for. Yes. And they did not understand what they should have asked for. Exactly. That is a huge thing. Understanding what you paid for, not translating it to what you thought you asked for is what we're trying to prevent. 100%. We're trying we want to have a product. You need a product. You're not going to make profit without a product. Product is necessary. And look at so you have to have something to sell. Someone asked me earlier this to talk about a little origin story. The origin story is I didn't know this five years ago. People were calling us because they had failed on our Kickstarter campaign to deliver the product. They had failed at actually, or they got frustrated with going through the license process and they'd spent huge money, hundreds of thousands of dollars. And now I had to turn that process into, hey guys, let's not focus on the past. Let's take what you had. Let's adjust it for the future of making the product. And this is where people start to, this is where the record's gonna scratch the needle. And honestly, if you are in this conversation and you don't understand this, like this is what you need to go educate yourself on first before you talk to us. Because I can help you, Bobby can help you, this team can help you actually not waste money to validate your product idea and then go to market. And with product, right? Because here's the one thing that you have after the way the industry tells you, you still don't, you still can't answer the question: what are your margins? Exactly. But but also I will say this everything that has to be done from the sketch to the market stuff has to be done. Let's do it properly in a proper order so we could end up with a product with margins. Okay. With margins. So let's turn the page, right? Because we're gonna talk about what we do different, and this is what everyone needs to understand. So here, let's ⁓ let's throw that away because that's junk. Let's go. What we do, we're first of all, we're flat fee based. So all the services that you just asked, our shift is the same. That needs to get done, but we're focused on manufacturing your product. So the very first thing we do is in our accelerator contract, it's market research and strategic foundation. Why is that important? We have to know the market. We have to know where your product fits into the market. We have to know the benefits of your product towards the market. If we're going to sell the product, we have to be able to explain everything about your product. We also need to start understanding the next part, which is brand creation and visual identity. That's that's step two. How do ask for your product? How do I identify that this is a product that speaks to me? When you see the Apple or Nike logo, what do you feel, Bobby? You know it's know it's coming for quality, know where you're getting it from. You know what your expectation is, right? So if we're going to sell a product to an audience, you have to identify visually and with the brand. That's just the way it works. How do they ask for you? Can I ask you in all your conversations that you had in the invention help space, did you ever talk about the brand? Never, never visual identity. Never how would identify How important do you think that is? A hundred percent. ⁓ my god. Like that's that's step one. This listen, everybody a lot of companies make white t shirts, but it all depends on a brand name, what you're paying for. And now people will say, ⁓ I already got a name. Come on. You know, you know, everyone comes in with a name. Those are not trademarkable, they are not protectable, they are probably infringing on other people's rights. You probably can't get the dot com and you can't get all the handles that you need on social media. Where do people search today, Bobby? The internet. Yeah. And and specifically, are like how many times do you get introduced to something on TikTok? That's TikTok, Instagram, that's where most people advertise it on. Nobody's buying it. So imagine, imagine that you have one name on your website, one name on TikTok, one name on Instagram. All names are different. Does that sound like ⁓ what I what I would I say here? No colour. A strategic foundation? Not one bit. Does that sound like I can identify I can visually identify a brand? No, you think you're buying two different brands, two different names. Yes. So that's why the the brand consideration, that strategy has to be done from the front. And again, I will tell us tell you if you think you got your name, there has never been a name that's come into this that has succeeded in the test that we put it through to succeed. And the biggest test is I'm not spending $10,000 to buy a name. No. Right? Those dot coms are there. But why would I spend $10,000? It'll be there. It'll be there. Down the road. Let's start with a $14.99 name that we that fits, explains the product. There's all so many rules that go into that, but you can learn that on other podcasts. Number three, product design and product development. What does that mean? We have to prototype this product. We have to look at the materials. We have to look at the thickness. We have to look at does it pass UL standards if it's electronic? We have to look at everything else before we go to production, before we go to finishing. So product design and product development sounds like we do the sketching. Yes. Sounds like we do the prototyping. Sounds like we do the cat. Here's it's we do the CAD. You're a hundred percent right. But here's the biggest difference. It's a thing called DFM, design for manufacturing, because it's the and here. Product design includes the first three things to talk about. What no one likes to do is the product development, because that's where it gets hard. Because making your product into a development means you need to have the manufacturing resources that nobody has. It is really easy for them to say, I have 2,000 ⁓ manufacturers that I can introduce you to. Bobby, can you talk to a manufacturer? No, not without designing many. Any individual and I challenge you, if you think you you can talk manufacturing lingo, I've been doing this 10 years, I still struggle with it. Everybody comes in with a sketch just as ready to go. No, so not even close. So, what's the manufacturer's expectations? They want to understand where's your step file, they want to understand what you're making, they want to understand how does this pop out of a machine? Hey, we have these machines. Is this signed up or is this designed for the machine? It is a circular conversation. So when we say product design and product development, it is an and because the two of them have to work hand in hand to get a product designed, developed, and actually manufacturable. Because step four in our smoke. One more thing is yeah, most manufacturers are going to ask you for those things when you go to them. So they're going to send you somewhere else to go get it done where we're doing it in-house already. Which means on the old process, you can go back to someone that you haven't talked to three years ago that designed something that maybe not around, or is going to say, Well, I don't know what they're talking about. I gave you a design. Exactly. Design is not the way something is manufactured. It is just a design. It looks like your product could probably be 3D printed, but the way it pops out of a plastic injection molded tool. Or the way it comes off an assembly line or the way it goes through the manufacturing machines that make things, it it's just not designed for that. Not one bit. Right. So design and design for manufacturing, two different things. But here's where step step four comes in. Mark manufacturing preparation. Spoke four is the culmination of making sure that the the expertise that is needed is available to my brand creation team. Yes, sir. That's available to my product design team. And that we can actually the product development team. There's three people having this conversation on how do you not just three people, three teams. Three teams that are having this conversation about your product. Now, I always say the fifth spoke is the what I call the continuity spoke, which is marketing strategy and tactical implementation. Let's break that down. Why do we use the word tactical implementation? Strategic. It has to be strategic. It has to be tactical. There cannot be, ⁓ I don't know what I'm doing. I don't know how to move forward. I didn't know that that's how we want it designed. I don't think I didn't know that that was part of the brand conversation. Those are conversations we're having the whole time. That's a goal. I tell people all the time like we have 65 incredibly talented people, but there is five people I hold accountable to make sure that number five, that market strategy and the tactical implementation of a product go it succinctly and don't get out of hand. They get the end result, the objective at the end has to be we're launching this product that we started with. And if you don't have that all under one roof, man, I don't even know how you do it. Just delays and conversations and and you're dealing with someone in China, someone over here, d not talking to each other. So you you you've been in like look, you've you come in the office and I encourage everybody, the door is open. You want to come see chaos that is controlled and has valued purpose, it's fine. Come in and see it because we have an open we have an open concept, right? Yes. Every team is sitting aligned for the steps that they have to work together because it is not If marketing says something shouldn't be designed the way that it should be that we're thinking of designing, that's a pretty important thing to know right now. Right at the beginning. And and let's say we even went further and we we found it out through later process of discovery. We're gonna go back and change that. And we're right there next to each other. We don't have to go across town or go talk to someone else or to a different city. You know ⁓ I always say this, like some people I do give people PTSD. I yell Justin's name all the time, I yell Steve's name all the time because I need to react. When the market changes or where things need to be adjusted, or when we have to have a podcast to educate people, always change. Do we have time? No. Never. Take advantage of it now. You gotta do things quickly. You gotta pivot fast and you gotta measure twice to cut once. So that is the marketing strategic and tactical implementation. That that that is just the if you're not doing that, you it's like having it's like building a new house without a general contractor. You're letting and letting your 15 year old kid actually manage the process. Because you you don't know what you don't know. No, no. And look at there's times over where I don't know what we don't know, but that's why we have a team. That's why we have the people with us. So that's why we hire them for are you confident in our team, Bobby? You've been here. First of all, I wouldn't have left what I was doing to come here if I wasn't. Right. So I can assure, and I again, because I've hand selected most of this team, I know what we need to do. They were all probably third party contractors that in that process they weren't under my roof. So they kept take it was too long to get results. Now that they're all under one roof, like you said, we're not yelling across the room. ⁓ my God. It like, ⁓ stop the presses. Let's make changes. We just discovered something. And we can adjust quickly because it really is measure 10 times before you cut once into production. So it costs too much at the end and start all over again. Let's get let's catch these things early. All right. So the biggest question we have is spoke six. The bridge meeting and go to market strategy. How important is that? Before you go to production, you want to know your product. You want to know what it takes to deliver. You actually want to know how long it takes to get here if it's coming from China. You want to know what is going to be packaged in. You want to know how the box looks in. You want to know what your logo looks like. You want to know everything about this product before you go to production, not what half of this or half of that. Let's get it done right. So when we order, we're ready to go. So I'll I'll translate that too. I think that sounded very due diligence that like we're double checking everything before we take that big step forward into production. Because when you cut into a tool, Bobby, or when you let's say you made a tool, and just for those of you, you can look up what tooling means. It is a big chunk of steel that you cut out so you can plaque. plastic injection mold something or you invest in tooling for ⁓ mass production mass production so cut and sew you can make you can cut things out once with a big press. Those are things jig. They call it a jigging construction fixtures, exactly. All those things. But if you don't have the tight answers and are like if you don't know your what you're expecting, what would you get for the end result? Something not working. You're gonna have you have flaws. That sounds like extreme have returns. That sounds like extreme failure to to me. And that, you know, I can't guarantee success, but I can ensure failure's not enough. And I'd go back to the drawing board to make sure that that doesn't happen. And the bridge meeting isn't a like, okay, go or no go. It is just a revalidation of everything that we've decided on that point, just to double check one last time. If you're getting on an airplane, what's the first thing that what's the first thing a pilot does when they get in the cockpit? They assure you. Here's what we're doing. You the storage comes in. Here's the emergency. They do they have a pre-check list. They a they have a walk around. They have everything they have to do because do you want to discover a problem in the air? No. No, you do not. So I equate that to the same thing. We do not want to have a problem when the product arrives here and the consumer gets it in their hand and they go, It's a piece of crap. Right. This this doesn't fit in my hand. It doesn't, it's not the right color. It was too much money. Like those are all the things that that kill your sales. If you don't do the proper preparation, you will end up with improper product. Bridge meeting is so important. So important. And again, does that sound like a great value? That's part of the plan. It's it's what if you're not doing that, you're missing out. So look at I I would constantly tell you that your manufacture your product equals sell your product. If you don't manufacture right, you can't sell it. You didn't design it right, no one's gonna buy it. If you don't have your audience built and know where you're gonna target them, no one's buying it. You have no idea. It is so much harder to sell something than it is to make something. Yes, it is. And if you don't want to have a warehouse, something not selling. However, if you make it right, make it right. Meets the consumer's needs and wants, which is what we look for, unique value propositions. This is the way you succeed. Let's get it out there. It's got to get brand recognition. People have to be able to see it. And look at I'm going to add one last thing because there's one step before this. We have to do one thing. I don't want to move forward unless I know three things. Can I sell your product? Meaning 'cause the will is sell. Because if the market doesn't allow it to sell, then the second part is what do I need? Can I make this? Right. The second thing is can I make this? And the third thing is do you understand that you are like we're starting a business? Hundred percent. This is a business. So this is a business. This is your your dream job. I had my glasses on. What were you trying to tell me? Yeah, exactly. We couldn't see it. All right. So I I thought I covered that, but thank you, Steve. The one stop shop. Look at I have an incredible team to help make sure that we are the continuity of this conversation's happening. Look at when we are a one-stop shop, which is what our accelerator program does, which is what you absolutely need, except the industry has told you that there's another way. It's a shortcut. They're all trying to take nickels and dimes from you. I'd rather we get organized, structure, structure a campaign, do it all under one roof, all in one to get to the end result. To s launch a successful product. And before we do anything like that, the only question I have is will this sell? And that's what Bobby and I do every day. We are idea consultants because how many idea have you listened to in in your career? In my career? Yeah. At least twenty thousand. Yeah, I'm probably in the same boat, twenty to thirty thousand conversations. How many twenty week alone? Very few. Yeah. So because people aren't prepared. They don't look at the market as the market. I'm gonna say I think I think I'm surprised that like 10% are really good. And out of those 10%, so for me, 30,000 or 20,000, we've only launched 741 clients as of today, I think. It's a funnel. It's a funnel and the 10% are really good. The 1% that move forward have the ability to be confident, have no doubt, and find the resources and the capital to go through the process. We can have the capital conversation ⁓ when we get on a call. I highly recommend at this point. You're comparing us to everybody else. We are not like anybody else. Everybody else is going tell you the parts that they do. I do all the parts so I don't need them and I manufacture. And I don't take the arrogant statement that I'm going to introduce you to manufacturers. Not when I will put my name on your product and actually be your manufacturer. So if there's concerns or questions, we own it. The company's here. Our our process is very, very matter of fact. We're going to have a Google Meet. We're going to meet. We're going to have a very simple discussion. Go over your product where you're at. What we do. If it goes further from then, then we all come in together. Now let's start a plan. But you're gonna have everything in writing after the first meeting as to the points, as we're working, ⁓ at what at what point, what's happening for you. It's a plan. We're there's we're not doing anything we're not doing for the clients, guys. It's it everything has to be cohesive, has to move fully so we could have a pro proper product and launch a good product. Would what would Biggie say? And if you don't know, now you know.