Most of a founder’s job is making hard decisions with incomplete information.
– Rob Walling
This week I’m trying something a little different and breaking the newsletter into 3 parts. 1) a story, 2) an update on my business progress, and 3) resources I’ve found helpful recently. First, the story.
I recently had a great conversation with Mike Wilner about how founders can go about de-risking their business decisions. Mike currently works on the Early Stage Startup team at AWS and spends much of his time talking to founders about how to best make progress on their business. He’s also the founder of several previous companies and the author of Oversubscribed.
Here’s a quick excerpt from our discussion where Mike talks about the concept of short loops.
"I see this a lot at Amazon. The startup team launches a lot of projects and experiments and so much of it is: Can you do something that works? Is it repeatable? Then you start repeating it, and next thing you know, you're building a team around it.
You have to be ruthless about killing things and understand when they don't work but I find a lot of founders undervalue that.
Finding anything that works really well repeatedly, gives customers a good experience, and that you can get value from, that is product-market fit at a small scale."
Mike told me it’s important to focus on creating these short repeatable loops to identify the biggest risks in your business and prevent spending time optimizing around false positives.
"You need to find the customer that is using your product and you are a part of their lives. It’s working really well when your customer would be really upset if you went out of business, and it would be painful for them to go back to the status quo."
The challenge is it's really hard in the very early stages. We often don't have enough data to answer the hard questions with any kind of statistical significance which is why it’s so important to shorten the loop and continuously ask: At this point, what is the biggest risk.
Mike shared an example of a company who went through this process of picking a small thing that would be a success and then testing and validating their ability to do it.
I talked to a company that just raised money basically with a little bit of traction, but not even impressive traction, because it's not about revenue. It's not about any of that. It's that they've shown that they can repeat this one thing and they actually know where they're gonna get their customers. They know how they're gonna go to market through going through this process.
For me, this was the biggest takeaway from our conversation. The difference between progress an growth.
Growth might mean more revenue, more subscribers, more leads but do you know how you got there? What did you learn? How much progress have you actually made? As a business are you able to answer the questions that hold the most risk?
- Can you find your ideal customers?
- Do they want your product?
- Are you able to deliver value to them?
"Progress to me is measured by how much you de-risk"
Being intentional about testing your riskiest assumptions and experimenting in short loops can help you make progress faster, increase your rate of learning, and ultimately drive sustainable growth.
This was just a short excerpt from our conversation but I'm curious to hear what you think. Are you proactively testing your riskiest assumptions? Do you buy into "progress" being more important than "growth" for early startups?
First off, thank you to everyone who reached out with words of support and encouragement as I started this new adventure. I’m now just over a month into running my independent business full-time. Here’s what I’ve been doing “on the business”.
- The productized Customer Discovery Sprints Service I launched has taken off faster than I ever expected and was oversubscribed by week 2. I discovered that offering a pre-packaged product to existing service providers such as UX designers was a shortcut to sales as it allowed them to position themselves as a more full-service offering and sell at a higher price point themselves. In the coming weeks, I’ll be sharing more about my process with updates to my free Customer Interviews course and details of how I plan to scale the service.
- The first section of my Customer Driven guide is coming together nicely and I’ve been busy scheduling and interviewing some awesome guests for the guide and an exciting new project. I’ve found recording audio to be a really effective way to share my thoughts and have started recording a transcribing more of my conversations so that I can pull out useful snippets for later use. Can you guess what that new project might be?
What I've Been Reading
How crafty marketers are buying triggers to outsmart their competition (12-minute read). Katelyn Bourgoin shares the story of how Casper stepped outside the traditional marketing playbook to drive down acquisition costs and scale faster by using deep customer research to understand what was triggering their customers to start looking for solutions.
Why successful SaaS startups fumble and fail to scale (7-minute read). Badass SaaS marketing duo Gia Laudi and Claire Suellentrop explain why following marketing “best practice” could kill your startup and outline the core principles you should follow instead. If you’re looking for some hands-on marketing support they’re also offering a new service to help founders develop repeatable high-impact growth strategies.
Managing risk like a navy seal (7-minute reading time). Ex-Seal Bob Schoultz describes the parallels between how Navy Seals operate in hostile environments with the chaos of business.
Was this valuable to you? How did you like the: story, business progress, and resources format? I'd love to hear what you think. Hit "reply" and let me know.
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