Startup Essentials introduces 3 must-knows to check off before starting any company or personal project. Whether you’re becoming a social influencer or embarking on your 1st startup, Startup Essentials are simple but important concepts for making your entrepreneurial endeavor as successful as possible. If you missed the 2nd, find it here.
And you’re off: your unparelled, “purple cow” product is in development, you’re mindful of recruiting & thinking with a “culture 1st” mindset and you’re feeling ON FIRE.
But there’s one missing piece…something some would consider the most important ingredient: traction. Regardless of your product (whether it’s software as a service, a social network, or a consumer good) success will be defined by how consistently you can grow & acquire customers.
You’re probably wondering: what’s the danger if you don’t? Legendary Venture Capitalist and PayPal Mafia member, Peter Thiel, heeds the following: “Poor distribution, not product, is the number one cause of failure. If you can get even a single distribution channel to work, you have great business.”
So yes, it’s a big deal.
But I get it: the reason why you started this company in the first place was to develop this mic-dropping product that would solve a pressing problem of yours (and hopefully others), so it’s tempting to give it your full concentration.
Yet, that’s the mistake almost all entrepreneurs make.
Don’t follow suit. You could end up massively disappointed with no one in the audience when you open those rosy curtains & unveil your masterpiece.
Sure, an audience of two (you and your mom) is just fine, but you started this business for the millions who you KNOW would find unparalleled benefits from your product.
Which is another reason why the concept of traction is paramount for investors when they qualify any startup. Seattle-based Venture Capitalist, Greg Gottesman, once told me that if your product is a car, VCs (venture capital firms) don’t want to give you money for build; they want to give you money to fuel it.
Thus, show that this car can at least roll!
Traction is hard evidence that you’re on the right path and consumers want what you got.
So how do you avoid this situation? Gabriel Weinberg, Founder of private search engine DuckDuckGo, recommends to follow a 50/50 rule and figure out traction strategy in parallel with product development.
By spending 50% of your time (yes, 20 hours in a 40 hour work week) on traction, you have the dual benefit of 1) building excitement in advance (think of Robinhood’s cryptocurrency waitlist) and 2) receiving insight from early customers that you can incorporate and in-turn, reach PMF (product-market fit) sooner.
But how do you build a traction strategy? Where do you start?
Fortunately, our man, Gabe, wrote an entire book on the subject, Traction, and I’ll walk you through the 60-second version. To begin, all marketing strategies dwindle down to 19 traction channels:
- Targeting Niche Blogs
- Unconventional PR (i.e. stunts, going above & beyond for customers)
- Search Engine Marketing
- Social & Display Ads
- Offline Ads (Billboards, radio, TV)
- Content Marketing
- Email marketing
- Engineering As Marketing (ex. Moz Keyword Explorer)
- Viral Marketing
- Business Development (i.e. partnerships)
- Affiliate Programs (i.e. kickback programs)
- Existing Platforms (i.e. top “x app” in the iTunes App Store, plug-ins for Facebook)
- Offline Events (i.e. meetups, mini-conferences)
- Speaking Engagements
- Community Building
If you have any doubts about the these, the hard facts are that each have been used by unicorn tech companies (valued at $1B and more) like Dropbox, Mint, Facebook, Uber, and Slack, with mammoth success.
So best to lean in and soak this up.
That said, the way to figure out the best strategy for your company is to use something Gabe calls the Bullseye Framework, which can be visualized as a 3-ring bullseye:
- Your outer ring tells you what’s possible where you brainstorm an idea for each of the 19, with the simple rule that each idea must “move the needle” and have the potential to reach a lot of users (tens of thousands to hundreds of thousands)
- Following suit, your middle ring tells you of what’s probable. Promote your 3 best traction channel ideas from your outer ring and run cheap tests to see which is the most promising
- And your inner ring tells you what’s working. This is the time to focus solely on the core channel that moved the needle the most in your middle ring and squeeze everything you can out of that sucker (likely a 5-15 week period)
Some additional tips to help you: in your middle ring, running A/B tests will be like a NZT-48 pill for your startup: increasing your efficiency by 2-3 times and getting you to the inner ring that much quicker.
Second, feel free to run many tests at once in your middle ring (ex. 4 different Facebook Ads, 3 different ad groups for a Google Adword campaign) so to get enough data to make an objectively informed decision.
And third, stay focused on your inner ring strategy and diligently put all energy and resources towards just one for now (not two, and definitely not three).
So what are you waiting for? As they say in Traction, “Startups don’t fail because they can’t build a product…it’s because they can’t get traction.”
If you’re still unsure of where to start, feel free to reach out to me and I’ll gladly help you brainstorm ideas for your traction channels and build out your own Bullseye Framework.