Rival proves our goal is in the ballpark ... and we're not crazy
Diary of a startup
The construction of a Minimum Viable Product (MVP) is a core article of faith required of all startup adherents. This week, I'll outline our plan to build and launch an MVP in three months, this being the length of time that Silicon Valley dogma demands.
The observant amongst you will have noted that the weekly newsletter we publish (targeted at conference speakers) is in fact our MVP. This is true. It is a product that provides value to a market segment. The price is €0.00, as it is more valuable to us as a market research tool. We're now going to build our MVP version 2.0, which happens to be a website with some functionality that conference speakers and organisers might find useful.
Before we get into all that, let's do our weekly review of the newsletter performance.
If you're just joining us, this article is part of a weekly startup diary for metsitaba.com, my startup, where I've committed to discussing my business decisions and their consequences openly, using numbers where I can.
The newsletter now has 160 subscribers and an open rate of 30pc. Last week these numbers were 144 and 25pc respectively. Yes it's growing, but not fast enough to reach 500 subscribers by the end of the year, which was my original goal.
So far, I've used reddit.com ads, and a personal email campaign to promote the newsletter, neither of which has had much impact on the growth rate.
We seem to have settled into a comfortable growth rate of around 10pc per week. Perhaps this is just natural growth and my promotional actions so far have had no real effect? I fear so.
The next promotional tactic to try is direct LinkedIn messages. I'm not hopeful. The fundamental problem is that these strategies are limited in scale, and that I do not have sufficient skill, or indeed time, to execute them well.
I can write the newsletter and generate quality content (this is validated by reader feedback), but online promotional marketing is not my strong suit.
In a startup you are supposed to clean the toilets. You are supposed to do every job, so that you can understand your business.
But that doesn't mean you should keep doing it, especially if you're bad at it! I need help with this now if I'm to reach my goal.
The benefit of having worked on it myself will help with assessing proposed solutions - another reason you should be the first to clean the toilets.
You may question my obsession with this goal. At what point do you call it a day and allocate resources elsewhere?
As I discussed last week, you can never have perfect, or anywhere near complete, information.
But at this point I believe that the resource allocation can still be justified by some key data: we are getting and retaining subscribers; our open rate is stable; the vast majority of speakers do not know about us yet; we have not exhausted all reasonable actions.
I also discovered one encouraging little data point in the last week.
It turns out there is another tech speakers newsletter that's been going for about two years.
It's a personal project rather than business-sponsored.
The twitter account has over 3000 followers so we can use that as a proxy for subscribers. This is great! Our goal is in the ballpark, and we're not crazy.
The worst thing you can ever say to an investor is that you have no competitors - that just proves there's no market.
Let's return to the MVP. Des Traynor, a founder of Intercom (a hugely successful Irish startup), recently spoke on product development at the WebSummit in Lisbon.
It's a great talk and it's well worth watching the whole thing at blog.intercom.com.
Des is famous for writing many great product articles on the Intercom blog. It's been a fantastically successful content marketing strategy for Intercom, and my inspiration for starting with content rather than software.
Des talks about choosing a problem for your product to solve and asks whether the problem represents a market. Is the problem large or small? Does the problem occur rarely or frequently?
This gives you four combinations. A large frequent problem is the best place to be. Large rare problems and small frequent problems are also pretty good. A small rare problem is the one to avoid.
This is good advice so far as it goes, but I beg to differ on strategy.
In the spirit of this article series, here's an explicit decision: starting with a small rare problem is the best way to build a successful MVP. Why?
Let's be clear on the strategy. In the business-to-business market, which is where I am, of course you want to find large problems that occur frequently.
Such problems are expensive and painful, and you can charge good money to solve them. It's the finding that's the trick. This is where the MVP comes in.
If you build your MVP for the final enterprise market you hope to address, you will fail miserably.
You'll have fewer features and be worse than every other solution (including manual ones like just using a spreadsheet - always a competitor to any enterprise solution ever).
You'll have no differentiator. Unique new features are not differentiators. They don't create a defensible moat because they can easily be copied by big players with lots of resources (for an example in the consumer space, see Facebook vs. Snapchat).
A small but loyal user-base is defensible. If you already have users, they will incur switching costs to move somewhere else.
Thus your MVP should deliberately target a small rare problem that nobody else is bothering about. In my case, making life easier for tech conference speakers is a small rare problem.
The pain points it solves are not mission critical, but they are just painful enough to need some automation: finding good conferences to speak at; organising your submission and attendance calendar, sending your talk details, bio, and photos to the conference organisers, publishing your talk portfolio, and so on.
These hurt just enough to pay the price of registering with a (free!) website that can help you complete these tasks with less effort. That's our MVP!
Richard Rodger is the founder of Metsitaba. He is a former co-founder of Nearform, a technology consultancy firm based in Waterford