Every day, startups are born and startups die. Thousands of them.
I spoke to 600+ early-stage founders while building Indiez, and only a few of them are successful now. This is really surprising to me because most of the founders weren’t incompetent. In fact, some of them were serial entrepreneurs and had incredible product thinking.
A simple google search for “Why startups fail?” led me to this:
‘No market need’, ‘running out of cash’, ‘lack of business model’ , ‘getting outcompeted’ and ‘poor marketing’ are all related to not being able to find enough customers.
Most of the time the cause of death is starvation. This happens for two reasons: No one wants your product and no one knows about your product.
We as founders really enjoy that orgasmic thought of having millions of users talking about our product. I’ve been there, and if you’re a founder, I know you’ve been there too.
But, what if I told you it’s really not about reaching a million users all at once?
It may appear that most startups nailed the perfect product on the first try, and it was so awesome that it went viral and reached a million users almost instantly.
But that’s really not the truth.
ALL successful startups started from a countable number of users and grew through repeatedly doing things that don’t scale.
There are no shortcuts. This is the ONLY way to grow.
According to Paul Graham (Founder, Y Combinator)- as a young startup, there are only three things you need to focus on —
- The product you’re going to build
- Building what your users want
- Unscalable things you do initially to get the company going
Believe it or not, that’s the ONLY way to reach a million users!
Simple? No, not at all actually.
I read extensively about what it really means to do things that don’t scale. A lot of blogs talk about the importance of doing things that don’t scale, but very few actually mention how to do these things. Here are some incredible insights I was able to find.
1. Recruit beta users
This has been talked about ad nauseam, sure, but how exactly do you do it? Let’s take an example. Stripe, now a $5 billion startup, had a very simple beta sign up page that looked like this:
Through this simple page, they recruited people to test their products. Once someone agreed to try Stripe, they’d say “Right then, give me your laptop,” and set them up on the spot. This method of ‘Collision Installation’ helped them to get their first few users.
A Quora answer by Daniel, one of the beta users, said, “Once I used their product, I was sold. Within weeks, I had probably told every friend who built stuff on the web about using Stripe. It was, and still is, a fantastic product.”
Daniel also talked about how he would get proactively contacted through email from the founder if he ever hit an error page — even at 2 AM. And the problem would be sorted within minutes.
Tip: Get the support of your users who will then tweet, tell people, etc . Without their support, it’s virtually impossible to create early traction.
2. Get your own hands dirty
In the initial stages of product development, you can’t sit back and wait for the final product. This is the perfect time to dive into the industry and learn as much as you can by getting your hands dirty.
- Talk to people to understand pain points
- Experience existing solutions to discover what can be improved
- Participate in the development process
During our initial days at Indiez we made it a point to attend all important developer conferences. We pitched the idea to every developer we could connect with. This is how we built an awesome community of some of the best developers from across the world and got deeper insights about the industry.
There is no other way could have done it so fast. We couldn’t have just created a job listing and waited for people to apply.
AirBnB founders Chesky and Gebbia went door to door with a rented DSLR to get their first few listings up.
Pinterest founder Ben Silbermann went to design conferences to recruit design bloggers to create awesome content for the platform.
The Topspot founder visited almost 60 families in the Bay Area to have a chat with them.
Tip: When you’re first starting out, you should use all the channels that the big guys can’t use because they are focused on scale. Focus on mailing lists, forums, online communities, offline gatherings, etc. Those are all great ways to reach people.
3. Build only what is REALLY needed
You don’t need the finished product to start testing the waters. The development process is almost never finished. There is always something you can improve.
But it’s easy to get started. For example, Buffer started asking for payments without even implementing a payment gateway!
Here’s an important learning from Buffers founder Joel Gascoigne:
“I not only launched the product with paid plans from day 1, but I also didn’t fully implement the payment system. When someone upgraded to a paid plan, I would email them personally as soon as I received the email from Paypal. I didn’t do this to avoid the work, I did it because I had no idea whether it would be 4 days or 4 months before the first payment for Buffer. It would be a waste of programming effort to implement a slick payment system without validation with a few paying customers.”
Tip: Your developer’s time is an important resource and the smartest way to build is to only build features that are really required.
For example, if you’re building a social platform and it’s currently being used by only 10 active daily users, a ‘messaging’ feature is not what you should be building. Instead, go and meet those 10 active users!
4. Establish a personal connection
Simple things like this matter in the early days. You can build amazing relationships with your users over email. When first starting out, you can actually reply to every single email and stay connected to them.
Welcome them, ask them questions, get them interested.
Your first 5,000 users will get you your 500,000 users. Give them an insanely good experience.
Tip: Talking personally to your users is one of the most powerful things you can do. If you call someone within 5 minutes of them signing up for your service, your reach rates will typically go up from 25% to 75%.
5. Give value to every single user
In the initial stages, it’s feasible to go out of the way to help every single user and deliver value to them. Offering one-to-one sessions where you understand their problems and solve them is an excellent way to build a connection with them.
For example, we at Indiez used Intercom to personally converse with every single person who landed on our website. We could have automated it but we probably wouldn’t have been able to give so much value to every single user through that.
Tip: Go out of your way to give more than what people expect, and they’re sure to remember you.
If you’re a SaaS startup, focus on service first. People love SaaS. But they also love to have their hands held. First and foremost, be a friend. Tell clients how they can do something better if they had your personal touch. It’s the personal service touch that gets the clients. You can focus on converting them to SaaS later.
6. Let the fire burn
This is one of the most contradictory things I can tell you. I know that I’m contradicting myself but sometimes you have to let the angry customers be angry because you are focusing somewhere else.
In one famous instance, the PayPal founders certainly let this happen.
“We let 10,000+ complaints continue until one day we were positioned to solve the problem all at once,” they noted. “The team flew to Omaha and set up a 200-person call center within two months.”
Remember that not every customer is important. You can let the fire burn!
Tip: When you know that one feature will resolve 98% of customer problems, it’s better to build that feature and then speak to the angry customers with a solution in hand.
These are just a few tips that will definitely help you scale as you build your product. Remember, if you want to solve a problem, there’s no reason you cant find a solution.
Now go out there. Take that plunge, take that leap of faith.
Your passion and belief to build your idea are central to everything that you’re doing. Learn from the data, and move on.