📰 PRASÓWKA #47

Ciągłe czytanie książek, szczególnie takich, jak się poprawić i ciągle słuchanie podcastów nic nam nie zmieni w życiu. To nas może zmotywować, ale w pewnym momencie trzeba się ruszyć i coś zrobić.

The most common unscalable thing founders have to do at the start is to recruit users manually. Nearly all startups have to. You can't wait for users to come to you. You have to go out and get them.

More diffident founders ask "Will you try our beta?" and if the answer is yes, they say "Great, we'll send you a link." But the Collison brothers weren't going to wait. When anyone agreed to try Stripe they'd say "Right then, give me your laptop" and set them up on the spot.

Airbnb is a classic example of this technique. Marketplaces are so hard to get rolling that you should expect to take heroic measures at first. In Airbnb's case, these consisted of going door to door in New York, recruiting new users and helping existing ones improve their listings. When I remember the Airbnbs during YC, I picture them with rolly bags, because when they showed up for tuesday dinners they'd always just flown back from somewhere.

The question to ask about an early stage startup is not "is this company taking over the world?" but "how big could this company get if the founders did the right things?" And the right things often seem both laborious and inconsequential at the time. (…) Brian Chesky and Joe Gebbia didn't feel like they were en route to the big time as they were taking "professional" photos of their first hosts' apartments. They were just trying to survive. But in retrospect that too was the optimal path to dominating a big market.

How do you find users to recruit manually? If you build something to solve your own problems, then you only have to find your peers, which is usually straightforward. Otherwise you'll have to make a more deliberate effort to locate the most promising vein of users. The usual way to do that is to get some initial set of users by doing a comparatively untargeted launch, and then to observe which kind seem most enthusiastic, and seek out more like them. For example, Ben Silbermann noticed that a lot of the earliest Pinterest users were interested in design, so he went to a conference of design bloggers to recruit users, and that worked well.

Your first users should feel that signing up with you was one of the best choices they ever made. And you in turn should be racking your brains to think of new ways to delight them.

The product is just one component of that. For a big company it's necessarily the dominant one. But you can and should give users an insanely great experience with an early, incomplete, buggy product, if you make up the difference with attentiveness.

It's not enough just to do something extraordinary initially. You have to make an extraordinary effort initially. (…) If you have to be aggressive about user acquisition when you're small, you'll probably still be aggressive when you're big. (…) And most importantly, if you have to work hard to delight users when you only have a handful of them, you'll keep doing it when you have a lot.

Imagine Company A and Company B, both selling the same product. Company A has a CAC of $100, while Company B’s CAC is a whopping $1,000. So, Company A must be crushing it with that lower CAC, right? Wrong!

What if I told you it takes Company A three years to recoup that $100 and there is no upside, but Company B only takes three months to recover their $1,000 acquisition cost and there is an additional $2,000 upside? In this scenario, Company A is faced with the dreaded loooong funnel and should stop spending immediately, regardless of how low their CAC is; while Company B is seeing a beautiful paid marketing loop and should keep pouring money into their acquisition strategy, even at 10x the CAC!

We all (should) know that optimizing CAC without context is bad. So, to determine how much a company can afford to spend on CAC, most marketers turn to LTV.

In B2B subscription businesses where a customer lifetime may be 10 years or more (which is more common than not), setting your target CAC based on 1:3 of the total value means that it could be 3 years until you recoup the costs of acquisition.

Using payback periods not only reduces your dependence on long-term fortunetelling, it also gets your whole organization aligned with the same goals: instead of just expecting your acquisition/marketing teams to keep lowering the CAC, product and growth and even finance can get involved. After all, improving activation, expansion, retention, and monetization all impact the payback period significantly.

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