Don’t Use Ads to Get Your First Customers

Why ads are toxic to early stage startups

Mat Sherman
Oct 30, 2018 · 4 min read
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If you just started a company for the first time and you’re using ads to get your first paying customers, you’re doing it wrong. Unless you’re a repeat successful founder, you’ll be out of business in 2 years. I’m sure of it.

I often times post about my opinion on ads via Facebook or LinkedIn and get an emotional response, likely from people using ads themselves. I have a very aggressive stance against using ads to get your first customers because I think ads literally kill companies that could have been great. Here’s why:

You are pre product-market fit

It’s a process that takes companies years to do, but if you don’t have PMF, you will end up like Homejoy…dead. Homejoy raised $65,000,000 for their company, but failed. Why? Because they had a leaky bucket.

What’s a leaky bucket?

If you just started a company, you don’t have product-market fit yet, so much of the money you spend on ads will be wasted, because you also have a leaky bucket. All startups start out as leaky. The goal is to fill in the hole, then fill the bucket with water. Not fill it with water while figuring out how to fill the hole.

In short, ads are for scale, not for starting.

Resorting to ads shows a lack of resourcefulness

How about manually recruiting your first 20 paying customers? Work your network. Cold email. Go to free events. Show that you have the resourcefulness of a founder and get those customers on your time, not your dime.

PubLoft spends about $130/month on marketing software, and we’ve gotten over 40 customers who have paid us about $70,000 at the time of this writing. We don’t spend money on ads. We use our creativity and resourcefulness to find customers, not because we can’t use ads, but because we know we can do it without, and prefer to save that money.

If you default to using ads to get your first customers, it shows me that you may not be a purebred founder. You don’t have the resourcefulness to do it yourself. Earn your stripes, save your money, get out of the office and find your customers.

You are automating the only thing that matters

If you’re the business founder, you should be spending ALL OF YOUR TIME selling to, talking to, and learning from your potential customers. In the early days, you have no job other than finding PMF and the only way to do that is to talk to your customers.

With ads, you don’t even get to talk to them! They come to you and you don’t get any feedback from them, advice from them, data from them… it’s just… automated. Automation is not good when talking about your customers.

Do things that don’t scale, manually recruit your first customers, and learn as much as you can from them.

The bottom line

Call Me Mat

A collection of my thoughts on things

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