Originally published at Oradea Tech Hub on February 25th, 2020.
This is the second part in a series of articles around how to build and grow a startup. Read the first part here.
In 2010, two Stanford graduates set out to build a startup that would compete directly with Foursquare. It allowed users to check-in at locations, earn points for hanging out with friends, and post pictures of their meetings.Foursquare, at the time, had just popularised a new behaviour in the market — checking-in at a location.
This was not something normal people did back then. So, they had the difficult challenge of opening up a new frontier, so to speak. All this while they were also building and marketing their product.
This market had hundreds of other companies and startups that would continue to push it forward. It was yet another internet gold rush sparked by the iPhone's mass adoption and the increasingly vibrant App Store.
It's hard to overestimate the impact of the App Store as, back then, other phones had only the 'apps' preinstalled from the factory. Being able to expand what you could do with your phone, after you bought it, was game changing. As was the possibility for lone developers to easily build and launch phone apps to millions of people. Something that was almost impossible to do before.
Taking an even broader view for a second, it's important to understand that all startups ride on the back of previous waves of innovation. They do not exist in a vacuum. They are inevitably interlinked with broader market forces. This means founders need to understand the environment they are operating in. We'll get more in-depth in a future article about this. For now, here's a simple way to visualise markets, from a consumer behaviour perspective.
Newsworthy innovation happens at the start of the curve, in the innovators and early-adopter market. Here is where the majority of startup stories become folk legends and myths that perpetuate its culture. But, innovation happens across the whole spectrum. It's just different in approach.
While the first half focuses primarily on product-first growth, the second focuses on business model innovation. The more startups mature, the more they're forced to expand across the whole spectrum.
Take a look at Amazon or Apple. They have successfully integrated their business in all those different stages, beating back competitors in well-established late-majority markets.
So, what does all this have to do with building products people love? Well, your first question should be: which people? Who do you want to love your products?
Now, let's go back to 2010 and to our two Stanford graduates.
The first one was Kevin Systrom. While working on Burbn's prototype, he attended a party for a different startup where he met Andreessen Horowitz and people from Baseline Ventures. Later, after meeting them for a coffee, he quit his job and in two weeks secured a $500K seed investment. This allowed him to start hiring, so his old colleague from Stanford, Mike Krieger, joined the newly created startup. This was March of that year.
They pushed out as many features as they could, to get users to use their app. They were committed and moved fast.After a few months of hard work, the numbers weren't too great, though. Almost nobody used the check-in feature. But, looking at the usage analytics, they saw that photo sharing was used like crazy. They had worked a lot on developing everything. Now they faced a tough decision.Should they scrap months of work and double down on that one feature that was most used?They decided to trust the data.
Here's what they did, in the words of Keith Sawyer's book 'Zig Zag: The Surprising Path to Greater Creativity.'
They began by studying all of the popular photography apps, and they quickly homed in on two main competitors. Hipstamatic was cool and had great filters, but it was hard to share your photos. Facebook was the king of social networking, but its iPhone app didn’t have a great photo-sharing feature. Mike and Kevin saw an opportunity to slip in between Hipstamatic and Facebook, by developing an easy-to-use app that made social photo-sharing simple. They chopped everything out of Burbn except the photo, comment, and like features.
It was October, 2010, and Instagram was born.
It turned out that Burbn's alternative features, centred around Foursquare's check-in, were not what people wanted.
In fact, Foursquare, at the time, had trouble reaching high user adoption. In 2010, the likes of Facebook, Microsoft and Yahoo were trying to acquire them, even though they barely had a million users. It took them years of challenges to reach high adoption and ultimately expand into location data as a service for the likes of Uber, Airbnb, and Apple.
Finding out what people love is not a straight line from idea to growth.
This should lift off some pressure from your shoulders if you're thinking about building something. Everyone struggles to reach a point where they have loyal users who love their product.So what are some things that help, along the way?
This sounds easy enough but there are some things to be careful about. They shouldn't be your long-time friends because they probably are not the target demographic you're after. If they are, they probably are going to discourage you (in which case, get better friends) or overly encourage you. Both cases lead to a distorted view of how the product is doing.
You should aim to find the best people that fit your product's target market, then ask them to help you. Early on, having around 10 to 100 such people (depending on what you are building) is what will allow you to have a tight feedback loop.
Having some users who want to help you is pointless unless you have a consistent feedback loop. This means that, at the very least, your process should look like this: Build > Measure > Learn > Repeat. Keeping a schedule for how long each step should take helps you both structure your effort and keep users close. They should be used with you getting their feedback on a regular basis.
Within your startup, there can be many other smaller feedback loops. Another important one is information transfer between your colleagues. They should be on the same page at all times. How do you manage that, is up to you, but not having a continuous process will result in internal struggles and misinformation.
In terms of the actual product, the fewer steps your users have to take to reach some sort of value for them, the better.
This is one side of a two-sided challenge. Getting people to go through your product and get value from it involves thinking deeply about:
People usually just think about the second. They build products that try to present all the ways their users can reach goals, with some of them being highlighted. This is usually the underlying reason why building more and more features becomes the automatic response when users don't use your product enough.While lack of features can easily be the case for that, having too many steps from start to 'wow' is usually an ignored problem.
What is the 'wow' moment that your product should deliver to a user? When and where precisely should that happen? Once you answer these questions, you'll more easily see that a sign-up process with three screens is bad user experience, and seven features to choose from when opening the application might be too much.
Once you got the 'time-to-wow' as short as reasonably possible, you can freely think about how to incentivise behaviours.And, of course, the process should repeat for any new feature you launch. Making it easier and faster (not necessarily simpler) allows your startup to grow without overflowing customer support questions.
When starting out, your mantra should be 'move fast and break things' but that can only apply to your own internal process.It can't apply to the user experience.
Especially early on, what users think and feel about your product matters a lot. A fan of your product is your best marketing asset. Word of mouth is real and can make or break your startup in a matter of months.
Obsess over the details. A cute or cool animation while a screen is loading can make the difference between a user deciding to invest their time in using the app further, or simply force quitting, uninstalling, and using your competitor.
Sending three notifications within the first hour might make sense for you because they just signed-up but it might annoy a user enough to uninstall your app.
Having an icon that is pixelated, compared to other things they see on their laptop or phone, might trigger a user's search for a better competitor with better visuals.
These are just some of the details that can quickly add up and make it impossible for your product to be lovable.
Once you go over a certain number of users, it's almost impossible to get relevant feedback directly, that can also be generalisable to everyone else. Using analytics tools to understand how users behave becomes critical.
There are hundreds of great analytics tools you can use to do this, ranging from free to pay-as-you-go. Don't overthink it, anything that allows you to track how users flow from one screen to another and what actions they take is enough.
Learning how to interpret data might be an art form in enterprise settings but for startups it should be straightforward as long as you think about the basics of great user experience.
Very few people talk about healthy values in startups. But if you want to build something that people love, you can't do it on the back of dishonesty. It might seem weird to say it out loud but being honourable is valuable for your startup's long-term success.
This applies to how you treat your colleagues and customers, and it's critical in your relationship with investors and other stakeholders.
You should work with honourable stakeholders. Take the time to properly do your due diligence on whoever presents you an offer. This will protect you from toxic business relationships in the future.
Everything your startup does will be treated accordingly by your customers. Being a lovable startup requires a certain set of values you need to uphold. What those values should be, is up to you. Your company culture leads everything you do — from hiring to IPOs.At Qubiz we love helping our clients build products and solutions that solve real-world problems. If you are looking for a great team to help you develop your startup, we would love to talk.