Short Term vs Long Term

Startups today have a very fundamental problem. I noticed this when I was speaking to a founder who wanted to me to help them in growth. Given their type of business I suggested them to focus on growth through organic search. The conversation went something as follows:

Me: Growth through organic search results works well. It works brilliantly for the long term. It takes about 6–9 months for it to kick in. But I will suggest being patient with it.

Founder: My target for doing SEO (Search Engine Optimization) is 3 months. We need to get it done in that time.

Me: Do you realise that SEO is not completely in our hands. We need to excecute a set of steps correctly and then wait for Google to crawl through the site.

Founder: Yes. But I need immediate results. With advertisements I can get users quicker.

Do you see the problem with the above conversation? Sure, advertisements are great and give you immediate results but you are then dependent on them. Further the cost to get each additional customer is higher i.e the cost to acquire customer # 101 is more than the cost acquire customer # 100. This makes advertising not a scalable way to acquire users. SEO, on the other hand, takes time. But gives a lasting business advantage. Doing good SEO allowed us to scale BOOKstreet from 100 monthly users to 100,000.

Further, there is fundamental flaw in the founder’s thought process. The founder is extremely short sighted. He wanted quick results over long term business advantage. One of the biggest issues with the startup ecosystem is quick results. No one wants to build a company that can last decades. I guess that’s what separates the men from the boys. Are they building for the long term or not? Analyse every company with that lens and you will identify winners easily.

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