Sometimes startups think of progress as rolling up a hill. You start off with almost nothing: a first iteration with no users and of maybe questionable value. But you believe that you’re able to roll up that hill to grow.
Sometimes, depending on what you are building, rolling up a hill cannot work. The hill, metaphorically speaking, is too steep and requires discrete steps to climb instead. Just as in the physical world, after each step you have a little place to rest and build. The steps may lead you to a less direct path but you’re getting closer to the goal and maybe with less exhaustion than if you had plodded ahead.
To show you what I mean, let’s look at examples from LinkedIn and Airbnb.
In 2003 LinkedIn’s founders sent the first iteration to 350 of their friends, followed up with anyone who didn’t create a profile and by the time a month passed they had grown to 4,500 users. With additional feature development and investment, things kept going from there until users reached the hundreds of millions. As they grew to scale, they were able to develop business models around premium accounts, advertising and recruiting.
Airbnb had a harder start but grew past its small 2008 early user base by improving rental conversions with free professionally photographed apartments and also grew users by spamming renters on Craigslist.
But these two companies are different in what is needed for them to provide value. For example, even if there is only one member of LinkedIn it’s still partially valuable because visitors can still view the user’s profile and learn about their career. In that way, early LinkedIn functioned like a professionally-focused version of About.me. And in the early days you couldn’t really do all that much with people in your LinkedIn network.
However, Airbnb had a steeper hill to climb. Their service always needed both sides of the network to work. Simply listing your apartment with professional photos is more of a hassle than a benefit if no renters ever book nights. While both LinkedIn and Airbnb achieved massive scale in the beginning, from the way they moved forward, I’d say that LinkedIn was able to “climb up steps” but Airbnb decided to (or had to) “roll up a hill.” If they had not had funding, they might not have lasted long enough — or they would have been forced to do things differently. I want to share how you can use the step climbing concept to survive long enough to make your way forward.
So instead of Airbnb’s progression of improved conversions (professional photography) and signups (Craigslist spam), what steps could they have used instead?
Here is a hypothetical example of a step. In the early days when there were few people renting the apartments, Airbnb could have tried to use “single player mode” — a tactic that Joel Gascoigne and Kevin DeWalt have described. Make something that has value even when there is just one person using it. For LinkedIn, this could have been the online career history. For Airbnb this could have been a competition to have the coolest apartment listed. Even if no one is renting yet, there’s value in pride, a contest or perhaps interior decorating awards. Activities like those could have gotten enough people on the network so that later on renting becomes an option.
I want to go a step further and propose No-Player Mode.
Can your startup be valuable to people even if no one uses it yet? And how can that help you climb up steps?
I think I can guess what you’re thinking: “what do you mean, ‘valuable before anyone uses it?'” Here’s what I mean, continuing with the LinkedIn and Airbnb examples.
If LinkedIn’s founders were not well connected and didn’t have hundreds of friends to spread the service they could have pulled data from existing career sites to compile a report on employment today. What jobs are growing, what are average salaries, what cities have the most opportunities for designers, etc. No one is using “LinkedIn” and yet they are able to provide value. Similarly for an “Airbnb” with no users they could have looked at data from AsiaXpat, Craigslist and other apartment listings and come up with advice on what rental prices will do.
You may have a sophisticated view of what your startup will do. You may have a grand vision. That’s great. But if your startup is unproven and no one knows you exist you need to consider your tactics.
For startups that require critical mass, how could you step your way to usefulness and an audience? Ride on top of existing groups to either collect input from them or fit right into their behavior, all without requiring them to actively join your startup or current experiment. Instead of trying to get enough people signed up to gain insight from their actions, can you go today to where people are already doing what you want in some other less elegant way, perhaps on some other network? They are not aware of it, but they may already be educated customers.
For example, here’s the Single-Player Mode play using a Q&A network (a difficult service to pull off well). In the beginning when no one has heard of the new Q&A service, go on existing large public networks, like Twitter, and search for questions being asked. You will find thousands of people asking their followers questions about all sorts of things. This is where your Q&A service starts to selectively answer the questions with good quality responses. You’re providing value for people who are not yet your (official) users. You can even provide VIP service to people once they join your service.
For the No-Player Mode twist on this, instead of actively answering existing questions, make the collection of data a first step to climb. What are the most asked types of questions about coffee? About dim sum? About investing? I bet that for any niche you think you’ll build for, there are already a ton of people already doing things together. This is a way to start to provide that value to them. That data can form the first part of your product.
I hope that these tools help you out as you build your startups. Let me know how it goes. If you like this, check out Startup Sacrilege for the Underdog Entrepreneur, a book written for startups outside of tech hubs.