How to Start a Startup — W04

Product. Doing things that don’t scale. PR

Here are a few takeaways from Stanford/Y Combinator CS183b — How to Start a Startup — Week 4 lectures.

Lecture 7 How to Build Products Users Love, Part I Kevin Hale, Founder, Wufoo and Partner, Y Combinator

Lecture 8 How to get started | Doing things that don’t scale | PR

Stanley Tang, Founder, DoorDash | Walker Williams, Founder, Teespring|Justin Kan, Founder, Twitch and Partner, Y Combinator

Building Products Users Love

Growth is the interaction between two variables: conversion rate and churn. The gap between those two things indicates how fast you are going to grow.

Just as real-life dating deals with a lot of first impressions, in software there are many first moments : the first email a user gets, what happens when the users get their first login, the very first time user interacts with customer support all these are opportunities to seduce the user.

“Japanese Quality”

To get those first impressions right Wufoo embraced the Japanese concept of quality. The Japanese have two words to describe quality

• “Atarimae hinshitsu” — functional quality.
• “Miryokuteki hinshitsu” — enchanting quality.

Examples of quality

When assessing products always think “What is the emotion on the person’s face when they interact with this?”

• Wufoo’s login page has a dinosaur on it, with a the tool tip that just says “RARRR!”; it put a smile on people’s faces universally.
• Vimeo’s login page is beautiful and the way the site interacts with you is magical.
• Cork’d (a defunct social network for wine lovers) had a sign-up page that was like a poem to fill out.
• Flickr’s sign in page had one of the best call-to-actions “Get in there!”
• Heroku’s signup page with sliding interactivity for scaling up the server and backend services is fun and easy.
• Chocolat a code editor had a funny notification which said when the free trial has expired everything remains the same, except the font would be changed to Comic Sans.
• Hurl a website for checking HTTP requests had a Unicorn throwing up a rainbow for error pages.
• MailChimp redesigned all of their help guides to look like magazines covers.
• Stripe an API company has no UX. The UX is actually just documentation with wonderful examples.

Fix the feedback loop with ‘Engineering’ customer support

The SDD (Support Driven Development) is a way of creating high-quality software. But how ? — make everyone do customer support. The people who built the software should be the ones supporting it.

Paul English at Kayak installed a red customer support phone line on the middle of the engineering floor. Joe at Airnb in the early years had a phone headset stuck to his head doing phone support nonstop.

Wufoo’s 500,000 registered users and 5 million people using Wufoo forms and reports were supported by the same 10 people and there was just one person dedicated to support in a day for any shift.

Jared Spool, at User Interface Engineering says there’s a direct correlation between how much time developers spend directly with users and how good the software is.

According to Jared Spool the knowledge gap among users can be fixed by either getting the users to increase their knowledge or decrease the amount of knowledge that’s needed to use the application.

Most often engineers think of adding new features and new features only increase the knowledge gap.

Wufoo wanted to decrease the knowledge gap so they spent 30% of their engineering time on internal tools like FAQ’s, tooltips, specific help pages to help with customer support.

There is almost no difference between an increase in conversion rate, 1% increase, and 1% decrease in churn; they do the exact same thing to your growth; however, the latter is actually much easier and cheaper to do. Wufoo employees get together every Friday to write simple handwritten thank you cards to users.

An article in HBR by Michael Treacy and Fred Wiersema says there are only 3 ways to achieve market dominance and based on how you want to achieve it your company should be organized in a very specific way: best price, best product and best overall solution.

• Best price, you focus on logistics — Walmart and Amazon.
• Best product, you focus on R&D — Apple.
• Best overall solution is being customer intimate — Luxury brands and the hospitality industry.

The third path is the only one that everyone can do at any stage of their company. It requires almost no money to get started with it.

How To Get Started

Stanley Tang, Founder — DoorDash

3 Lessons from DoorDash

• Test your hypothesis — Treat your startup ideas like experiments.Before launching, DoorDash spoke to 150 to 200 small business owners and decided to test their idea with restaurant delivery.
• Launch fast — They spent an afternoon putting together a quick landing page with their personal phone numbers on it. They had no drivers, no algorithms, no backend and no dispatch system. All they wanted to do was figure out if there was demand for such a service.
• Do things that don’t scale — It is one of the biggest competitive advantages when you are starting out, you can figure out how to scale once you have demand. DoorDash used Square to charge customers, Google Docs to track their orders and Apple’s Find My Friends to track their drivers. The founders did delivery, customer support, and sent personalized emails to customers asking about their delivery experience.

Doing Things That Don’t Scale

Walker Williams, Founder — Teespring

Finding your First Users

• The first users are impossibly hard to get and it is the founders responsibility to bring in those initial users. Founders need to spend a lot of their personal time and effort to bring in those users.
• Don’t give away your product for free. You need to make sure that users value your product. Free products are treated differently than paid products.

Turning Users into Champions

A champion is a user who is an advocate for your product. The easiest way to turn a user into a champion is to the delight them with an experience worth remembering.

The best way to do this in a non-scalable way is to just talk to those users and do it early. Talk to those users as much as you can, every single day for as long as possible.

There are three ways to talk to your customers -

• Run customer service yourself.
• Reach out to current and churn customers.
• Know what people are talking about your brand in social media and communities.

Finding Product/Market Fit

• The product you launch will almost certainly not be the product that takes you to scale, so in the early days progress and iterate as fast as possible to reach a product market fit.
• Optimize for speed over scalability and clean code.
• A rule of thumb is to worry only about the next order of magnitude, so when you have your tenth user, don’t worry about serving your millionth user.
• Keep doing things that don’t scale for as long as humanly possible, it is one of your biggest competitive advantages as a company. Don’t give it up willingly; it should be ripped from you.

PR

Justin Kan, Founder — Kiko and Twitch

Goal and Target Audience

Before you seek Press for your startup think about your target audience (Investors, Customers, Industry etc) and the goal for each of them.

• Socialcam — a spinoff of Justin.tv, the goal was to be known as video Instagram. Target audience were Silicon Valley investors and influencers.
• Exec — a local cleaning service, the goal was to get customers. Target audience were SF locals.
• TwitchTV — the goal was to reach the gaming industry. Target audience were industry trades and game development blogs.

Story

The type of stories that you usually see in startups are —

• Product launches — launching a different version of your app.
• Fundraising — raising a million dollar seed round.
• Milestones/metrics — one million dollars a week in revenue.
• Business Overviews — already successful and getting covered by The New York Times.
• Stunts — when WePay left a block of ice with money frozen at PayPal developer’s conference.
• Hiring Announcements — hired someone really important.
• Contributed Articles — writing some sort of industry overview or some opinion piece.

Mechanics of a Story

• Think of a story — refer above
• Get introduced — go to entrepreneurs or friends who were just written about in the press and get them to introduce you to the reporter who wrote about them.
• Set a date (4–7 days in advance) — give yourself lead time.
• Reach out (Get a commitment to invest time) — get a face-to-face meeting or a phone call. Worst is email exchange because it’s easy to be forgotten or ignored.
• Pitch — write the ideal story in bullet points, and memorize it. When pitching, structure your conversation around the outline, so what you wrote will be translated into an actual story.
• Follow up — before your actual news goes out, with a reminder email with details you care about.
• Launch your news — launch your product and get press coverage.

PR is a relationship business so keep your contacts fresh and establish a good relationship with a couple reporters that you could go to for breaking news.

*Photo by: Fabiana