Growing a startup is in a nutshell a game of trial and error.
On the product side, you are essentially trying to find the perfect combination of audience,
pain point, and solution.
While marketing or sales are of course essential, you can hire the best marketing
team with all the money in the world, and they still wouldn’t be able to make
a flawed product succeed. We have over a 100 Forensics episodes to prove it.
A customer hypothesis could be ‘first-time startup founders’,
a problem hypothesis is that ‘they don’t know how to navigate fundraising’ - and a
solution hypothesis could be an intensive accelerator program,
or a Skillshare course, or a suite of SaaS tools that guide you through the steps.
A company’s lifetime is how many times they can iterate on these three ideas
on these three variables
to find product-market fit before they run out of money. That’s it!
So in this video, I want to focus on three key pillars of growing a startup:
1- Building a good product that people NEED
2- Learning how to sell it 3- Iterating fast
Let’s talk about Product first, with a disclaimer.
While I’m the company CEO, and of course need to be involved with
everything, my focus through all these years with Slidebean has been around growth.
I think you can find product-oriented, ops-oriented and growth-oriented CEOs,
and I’m the latter. From the get go, it’s been my co-founders who have led
most of our product development, with me, getting involved mostly on the metrics and numbers side.
That being said, here are 5 key thoughts on the product.
1- Startups succeed if someone lives and breathes their product.
Truly great products, products that transform customer behavior
are built with a combination of a great idea and incredible execution.
To build a remarkable product the CTO, or the Head of Product,
or the Product Manager needs to fully immerse themselves in the mind of the customer.
That is something that you are NOT getting from an agency or
a dev you hire by the hour. Look at every single unicorn tech company today, and look at who their CTO was
and when they came into the business, they were co-founders.
2- Products succeed if they are essential, not nice to have.
Ask your customers how upset they’d be if they lost access to your product.
I didn’t make this up-it's a pretty standard Product-Market fit survey.
If customers are not extremely disappointed, you haven’t reached product-market fit yet.
Keep changing your hypothesis: maybe a different kind of customer, maybe a different problem
(which translates into a different reason why they would use your product).
Which is a different messaging through marketing
This brings me to my third point which is,
3- Go Niche You can’t make a product for every single customer
in the world, not from the get-go, at least. Divide and conquer. Become the perfect product
for one specific group of customers, find product-market fit with the, and them move on.
This should be an audience so specific you know everything about them.
Our audience is startup founders, majority early stage, usually new to the startup world.
They discover our Forensics videos and then move on to more advanced videos about running
a business. We look into what other content they watch and why they watch it.
If you know them well, you can sell to them.
4- Fast, metrics-driven iteration is key Now, fast iteration as a company was one
of my key pillars, but for now I’m referring to the product at the moment.
Make sure you have a team that can iterate quickly. Simple details like a
confusing signup screen or a bad call to action button
can be super low-hanging fruit fixes that could significantly change the outcome of your product.
5- Measure everything Last but not least, the only way you
can make educated decisions is by measuring. Make sure you set up good tracking across your product.
The ability to go back and understand what your users are doing is truly, priceless.
This brings me to the next point which is, GOING NICHE
Only a handful of products out there
can do a great job at fulfilling the needs of every customer.
Companies usually try to be really good at one thing first, and then
slowly expand that audience for more uses. Let’s look at CRMs, for example. There
are dozens of competing CRM products out there, and more keep showing up every day.
But if you look deep, you can easily find the target audiences for each one of them.
Salesforce is an example of a ‘corporate’, large business type of product. It’s expensive,
it’s hard to adopt, and it’s built with very large sales teams in mind.
On the contrary tools like Bigin by Zoho CRM are focused on small businesses and
simplicity. Pricing is a question for startups, so they’ve made an effort to price the product low,
and to save companies money by integrating their phone system inside the product.
They essentially handpicked the very basics of a CRM: pipelines, customer and company profiles,
oversee activities and dashboard- and packaged
it into a tool that’s not an overkill for the type of customer they target.
But the sales for customers will probably find a limit
You can’t be great at everything or great for everyone. Pick. Not only
from the product, but from the marketing side:
selling to a team of 10 is completely different to selling to a team of 500.
That brings me to my cup of tea which is selling your product, ie,
GROWTH MARKETING
The persona, or the growth marketer stands at the crossroads of product and marketing/sales.
The traditional publicity/marketing agency model is disconnected from product,
so they are good at marketing but not at growth.
Growth means not only looking at the best cost per click,
or the best sign-up rate- it means looking at which campaign brings better customers,
customers that retain better or that love the product. That requires looking at data.
We published a video last week outlining every single marketing channel, and you should go
watch it.. but from that I believe you can qualify growth channels into 3 large groups.
1- Self-Service First, self-service:
where customers sign up on their own, and if there is a paid component to your platform,
customers can find it a convert without having to interact with them.
Self-service growth usually applies for B2C (end-user) focused products,
or for B2B products on a low price range, maybe $1-$200/mo.
If this is you, you want to be focusing on bringing high-converting clicks via paid ads,
or a lot of clicks via organic traffic (which connect to SEO, referrals, and recommendations out of those 19 marketing channels)
and find a way to track and project what’s going to happen next month (which is easier said than
done, since these are very ‘unpredictable’ channels before you reach a critical mass).
For example a PR article, on websites that rank well on SEO, you can absolute control how that page will perform
so you can predict how that page will perform over the next few months.
You also live by your landing page and screen conversion rate. You’ll
want to be focusing on covering holes in your funnel so that you don’t have a leaky bucket.
from discovering your platform to conversion.
2- Inbound Sales
Inbound sales growth consists of generating leads and having a sales team that converts them.
Leads could be generated via PR, Paid Marketing, Business Development,
webinars and even in-person events- but the point is that these leads are funneled
to a sales team that needs to close the deal.
Tech products that depend on Inbound sales are usually pricier, and almost always B2B.
The price doesn’t necessarily respond to the product being more expensive to run,
or the services being more expensive
it responds to the fact that the product is likely harder to adopt,
and that the company needs to over the (expensive) cost of closing the deal.
Products growing through this channel might not advertise their pricing on their website, because
the purpose of their landing pages is capturing leads and moving them to a funnel.
Each lead is expensive, dozens or hundreds of dollars, so the sales team needs to make
sure that they do everything they can to make the most of each one of them.
This is where CRMs become essential, which brings us back to today’s sponsor, Bigin.
Bigin was envisioned by the folks from Zoho
(which do a bunch of other things) and their most important selling point is simplicity.
On the other extreme you have things like Salesforce,
which are overkill for most startups: you need a course to learn how to use them.
A simpler tool like Bigin allows you to move much faster,
visually understand the stage of your deals, manage your funnel, oversee your activities
and dashboard, automate processes and even make phone calls straight from the platform.
It’s also startup-friendly, at just $7/mo for their Express plan. You can get 50% off up to $100
on Bigin by Zoho CRM by clicking the link in the description.
3- Outbound sales Last but not least we have outbound
sales. This encompasses business development, partnerships, and even outbound emails.
If you rely on outbound sales you’d be working with a demand-generation team whose job is,
often times, to cold-pitch people- or to use their network to get relevant intros.
to those decision-makers.
Products that are sold via outbound sales are usually the most expensive, not only to make
up for the expensive cost of acquisition but because in order to cover that cost,
they need to target large companies, that have more expensive problems and needs.
You also need a CRM for Outbound Sales- but this
is absolutely not my cup of tea. I’ve built B2C and B2B companies,
but always relied on self-service marketing, and more recently, a little bit on inbound
sales. Happy to bring an expert in outbound as a guest if you’d like us to cover more on that.
Hope this was a useful cover of the basics of product and startup building. See you next week!