Unlike his regular episodes, where he interviews people and personalities from the startup world, this time, Jason himself answers questions from his audience.
1. How to regain confidence from investors after a failure or major pivot?
You need data to proof that your pivot is working (growth + engagement). That’s the way to rebuild credibility. Make sure you have enough runway to gather data before going back to your investors.
2. How to get competitive intelligence (i.e. pricing)?
- Sounds obvious, but just sign up or call them as a potential client
- Interview people who worked at a competitor
- Track changes on a competitors website with website change detection software. http://www.site24x7.com/web-application-monitoring.html
Most entrepreneurs underprice their product. Try to raise your price. Talk to your customers and find out what their real budget is
3. How are your portfolio companies tackling growth?
- Maintain your existing customers. Don’t loose a customer. Study engagement. If they stop using the product, speak to them and find out why. When somebody leaves, send them an email and ask them.
Why did you leave? (multiple choice)
How will you solve x from now on.
- Get new customers. Growth person vs. growth culture. Both approaches work. Need to track your metrics. Collect emails, email list. tweet, facebook. Understand SEO, paid traffic, open rates, people haven’t done is before, they need to learn this skill. Everybody in the company needs to understand the fundamentals of growth. And you need to understand your customers first.
4. How long should it take to reach “ramen” profitability?
Ramen profitability = making just enough money to pay the founders’ living expenses.
You want to look for retention. Know your acquisition price. Usage per day, retention.
5. How does a startup raise money without MRR
For B2B enterprise products, you want to know early on that you can make money. You don’t need MRR but you need some level of performance: customers, engagement, growth, world class design, a great team, extraordinary execution.
You can also proof that you are able to grow a product based on your previous company.
6. How open are you to not tech startup ideas?
Any business that can scale to 100m in revenue. 100x return on my money. Everything is based on return on investment.
7. How to find a technical cofounder?
Go to linkedin and find a company that has been sold 2 years ago. Those guys want to start/ lead their own thing and are not sensitive to salary. Find somebody who’s looking for a great project.
Tell everyone you’re looking for a technical cofounder. Email your network. If you can’t convince anybody, you have failed. Email. Events, Linkedin. Network.
8. What to focus on in a seed pitch?
Depends who you’re talking to. A tech person wants to know about tech. A business person will want to know the total addressable market and business model. A sales person will want to know about the go-to-market strategy.
Showing the product is critical. Show the product, don’t tell. Show product, growth + traction. Why are you building it. Say it simply.
If you cannot finish your product and get some customers to use it, you are not ready to take money from professional investors.
Don’t sell the product, sell the problem.
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