The launch date is finally here. After all the long nights, endless meetings and lobbying, your product is finally ready for the market. And then you launch. And the signups stay low, really low. What happened?
For startups, there is no day that is as crucial as the launch date. What we hear is success stories of Instagram, Pinterest and AirBnB. But their path to success has been anything but similar. These are well documented stories.
Behind every successful startup story is the untold story of the magnitude of efforts put in growing customer base. Finding scalable channels of acquisition requires strategic efforts, and is time consuming especially when you have no funds.
Launching a startup is always a hit or miss venture. According to a research by Shikhar Ghosh from Harvard Business School, 75% of all startups fail. The biggest reason of failure: not having enough customers.
Innovative products are good, coverage by Mashable and TechCrunch is great, but without customers, you have no business. Brian Moran of Get 10000 Fans says he failed in multiple businesses because he did not have the “right” audience.
“It never matters if I think a product will sell; it only matters if my audience agrees it’s something worth making.” Brian Moran, Get 10000 Fans
The Startup Risk
There are many factors that can contribute to the failure of a startup; product positioning, lack of a viable scalable model, cash flow management, lack of talent, not defining your value proposition and so on. Building a product is treading on dangerous waters, and thus you need to keep your ear on the ground, watch the market trends and know what your customers want.
You probably have product development road maps. However, do you have a strategy to get customers?
Recently, startups have been focusing on a countervailing force that makes building a company less risky. This methodology is known as “lean start up”, initially practiced by Toyota in Japan and popularized in the startup world by Eric Ries.
In a nutshell, the lean startup method involves building your product in line with watch customers want. Instead of completely developing a product and putting it in the market, you develop a prototype based on what customers want, ship it and then improve on it as you go on.
The lean startup helps startups to concentrate on the real features that their users want, and in turn save hundreds of hours or coding or developing a product that may struggle to be adopted in the market.
The lean startup has two advantages:
- You build a product that your market wants.
- You build a product together with an audience that is ready to buy.
Just ask Joel Gascoigne of Buffer how the company was able to generate a large audience of eager buyers without press mentions or coverage by TC and Mashable. From the onset, Buffer started building an audience while developing their product. Their blog was the single source of lead generation mechanism they had.
The team worked with their target users from the start, finding out their problems and shaping the product to be a viable solution in the market.
“With my previous product, I did not reach out to enough people and say “is this a problem for you?” in order to validate whether the product was something people may want.” Joel Gascoigne, Buffer
And when the launch date finally arrived, TechCrunch wasn’t there to cover the company but the product still took off. This is a perfect example of a startup that launched quietly and made strides, thanks to the founders for concentrating on their audience. Buffer went from an idea to getting paying customers in just 7 weeks.
Success with Launching Big
Don’t get it wrong; launching big can also work for you if the stars align in your favor. Let’s say you have a great product, have the ad budget and have Mashable /TechCrunch ready cover your product; you can gain traction fast and if you have the right plan, take off.
Moreover, startup events and conferences can give your company the right footing to take off. Y Combinator, 500 Startups and other accelerator programs are great exposure avenues for startups to potential users, employees and VCs. Twitter. Foursquare, Phonebooth and Tim Ferris all found their success after exhibiting at SXSW Accelerator.
With over 14,000 attendants and 1,500 media teams, this is the perfect combination to ignite a startup. However, SXSW success cannot be bought by snazzy marketing and ad dollars. It has to be earned.
“As a marketer, I’m happy to call out other marketers who think that SXWX launch success can be engineered or bought – it has instead to be earned with so much elbow grease and good will.” Josh Jones-Dilworth, SXWX Advisory member.
While product innovation is key to the success of a startup, addressing the needs of your target audience is more crucial.
Moneyball Entrepreneur Lessons
Moneyball, the book, has lots of great lessons for entrepreneurs. To disrupt status quo, you do not need to launch big. Moreover, you do not need to court TC and Mashable. Sure, press coverage can help to get your name out quick, but eventually it is customers who will decide whether your startup will survive.
“It’s day one of the first week. You can’t judge just yet.” Moneyball
Startup success does not happen overnight. You have to put in hundreds of long hours coding, testing, nurturing customers or simply building your product. Often, the best people take time to shine. As a leader in your startup, do not judge too early. Perhaps someone isn’t shining yet because everyone is too busy to pay attention or show him the ropes.
However, do not wait too long. If your product isn’t showing some good signs after the first three months, it is likely that you need to focus on something else. Traction, however little, can help you validate what you have on the table. Follow the lean startup principles and ship often and quickly. This will help you to get feedback on your product and know what your market wants.
There are many entrepreneur lessons from Moneyball and I encourage every founder to read the book.
So, what is a startup supposed to do?
Build a great product. This is primary for any business. With the competition in the industry, you will only stand out and get noticed by having an innovative product. However, after building the product, what next? Where do you get users?
One thing I’ve realized that most successful companies do is build a product and an audience at the same time. As you build your product, you should start looking for users. Start collecting emails, be active on social media and blog often about your solution.
Taking a proactive approach towards finding users will help you gain traction fast from early adopters before you eventually launch or come out of beta. It’s a cut-throat startup environment out here and only by finding and nurturing leads from the onset is your launch likely to be a success.