# Lecture 4 - Building Product, Talking to Users, and Growing (Adora Cheung)

**Creator:** YC Root Access
**Platform:** youtube
**Duration:** 52m
**Source:** https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4

## Summary

The speaker discusses strategies for transitioning from having no users to acquiring a significant user base, drawing from personal experiences and mistakes made during previous startups. Key points emphasize the importance of understanding the problem being solved, engaging with users early, and iterating based on feedback to create a product that meets market needs.

- Focus on immersing yourself in your startup idea, dedicating concentrated time to develop solutions.
- Avoid the novice approach of building in isolation; seek user feedback early to refine your product.
- Clearly define the problem your product addresses and ensure it resonates with your own experiences and passions.
- Become an expert in your industry by engaging directly with it, understanding inefficiencies, and identifying opportunities.
- Identify specific customer segments to optimize your product for targeted users.
- Develop a storyboard of the ideal user experience before building your product.
- Create a minimum viable product (MVP) that addresses core user needs and communicate its value succinctly.
- Utilize various channels for user acquisition, focusing on one at a time for effective growth strategies.

## Transcript

[[0:04]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=4s)
>> Thanks for having me. So today I am going to be
talking about how to go from zero users to many
users. I'm just assuming that you
have many great ideas in your head at this moment and you're kind of thinking
about what the next step is. So I wrote this up early
this morning, and a lot of this is based
off of mistakes I've made in the past. So as Sam mentioned, I went
through YC in 2010 and spent a number, three years
basically, going back and forth pivoting a bunch of
times, starting over a bunch of
times.

[[0:42]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=42s)
And have learned a lot about
what not to do if I were to start another
startup after Homejoy if that should ever happen. And so a lot of it comes
from failure and just telling you about what
you shouldn't do and kind of making generalizations of
what you should do from that. So just a reminder that this
is, sort of, you know, all
advice you should take as directionally good guidance,
like if all, like it's, it's kind of in
the right direction.

[[1:10]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=70s)
But every business is
different, you are different, I'm not
you, and so just take everything with,
you know, that in mind. So since this is a college
course, you know, when you start a startup you
should basically have lots of time on your hands to
concentrate on the start up. And I'm not saying you
should you know, quit school or you should
quit work. What I'm saying is you
should have a lot of time, compressed time in a row.

[[1:37]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=97s)
Really dedicated to
immersing yourself in the idea and developing
problems, or developing the solutions to the problem
you're trying to solve. So for example if you're in
school, you know, it's better to have one or two days straight of per
week on working on your idea versus you know, spending
two hours here and there every single day during the
course of the week. It's sort of like, I think
this is an engineering class so it's sort of like coding.

[[2:02]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=122s)
Like there's a lot of
context switching and just being able to really
focus, really, really focus and immerse yourself is very
very important. So, like I said, I sort of
first, when I wrote this up was
thinking what are things that some people
do or most people do that is not the correct way to do a
startup and sort of the novice approach I think
is what you see up here. Which is, you know, I have
this really great idea.

[[2:32]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=152s)
I don't wanna tell anyone
about it. I'm gonna build, build,
build, build. I'm gonna be telling one or two people and then I'm
gonna launch it on, you know, I'm gonna launch
it on TechCrunch or some, somewhere like that, then
I'm gonna get lots of users. But what really happens is
because you did not get a lot of that feedback
and stuff like that, you know maybe you get a lot
of people to your site, but no one sticks around
because you didn't get that initial user feedback.

[[2:56]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=176s)
And then, you know, if you, you know, if lucky enough
you have some money in the bank you might go buy
some users but sort of, it just whittles out over
time and you just give up. This is sort of a vicious
cycle and you know, I actually did
this once, and I did this while I was in
YC, and that was you know like,
when I went through YC I didn't even launch a
product, like I didn't even launch in
TechCrunch which is a thing you should definitely do.

[[3:21]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=201s)
And so you don't want to
ever get into that cycle because you'll just
end up with nothing good. So, the next thing is you
know, you have an idea and you should really think
about what the idea is really solving. Like what is the actual
problem? And so their problem
statements you should be able to describe it in one
sentence. And then you should think, how does that problem relate
to me? Am I really passionate about
that problem?

[[3:49]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=229s)
And then you should think,
okay, it's a problem I have, is it a problem that other
people have? And sort of verify that by,
you know, just going out and talking to people. One of the biggest mistakes
I've made is you know, we started, my co-founder
and I, who is also my brother, he
and I started a company called
Pathjoy in 2009, 2010. And our goal was basically
to you know, we had two goals in mind one
is to create a company that made people really happy,
and create a company that was very, very impactful, so
a good proxy for that is to just create a
huge, big company.

[[4:26]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=266s)
And so we thought, okay, here's sort of what we're
gonna solve is you know, make people happier, and we
first went to the notion of who are the people that made
people happy? And you know, we came up with life coaches
and therapists. So it seemed kind of obvious
to just create a platform for
life coaches and therapists. And what happened as a
result though was that you know, when we started using
the product ourselves we, you know, we're not cynical
people by any means, but life coaches and
therapists are just not people we would use
ourselves.

[[4:59]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=299s)
It was sort of useless to
us. And so, it wasn't even a
problem we had, and certainly wasn't something
we were super passionate about
building out. Yet we spent, you know, almost a year trying to do
this. And so, if you just start,
you know, from tegel zero, just like
think about this before you even build any product. I think you can save
yourself a lot of headache down the road from doing something you
don't wanna do.

[[5:22]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=322s)
So, say you have a problem
and you're able to state it. Where do you start? Like, how do you think of
solutions? So the first thing you
should do is think of what the industry that you
are getting yourself into. Whether it's big, whether
it's huge, you should really immerse
yourself in that industry. There's a number of ways to
do this. One is, you know, to really
become a cog in that industry for a little
bit.

[[5:52]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=352s)
And so it might seem a
little counter-intuitive to do this, because most people
say, you know, if you really wanna disrupt
an industry, you should really not be this,
you know, player in it. You should, you know,
someone who spent 20 or 30 years in an industry
probably you know, is set in their ways and is just used
to the way things work and really can't think about
what the inefficiencies are or the things that you can,
quote, unquote, disrupt.

[[6:17]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=377s)
But, however as a noob like
coming into the industry, you really should take one
or two months just really
understanding what all the little bits and pieces
of the industry are, and how it works because it's when
you get into the details, that's when you start seeing
things you can exploit. Things you can really,
things that are really, really inefficient and
provide you know huge overhead costs that you can
cut down. And, so an example of this
is, you know, when we start Homejoy and
we, we decided to go, we started with the cleaning
industry and when we started, you know, we just
were cleaners ourselves.

[[6:54]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=414s)
And we started to clean
houses and we found out really quickly
was that we were very bad cleaners. And so as a result, you
know, we said, okay, we got to learn more about this
and we went to buy books. And we bought books about
how to clean, which helped maybe a little
bit, we learned a little bit more
about cleaning supplies. But it's sort of like
basketball you know, you can watch and you can
learn, or you can watch and you can
read about basketball, but you're not gonna get any
better at it if you don't actually you
know, train and you know, throw a basketball around
and throw it into the hoop.

[[7:30]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=450s)
And so we decided one of us
basically had to go and learn how to clean. And so we went or get trained by you know, a
professional, some sort of a professional training
programs that existed. And that meant, we actually
went to get a job at a cleaning company itself. And the cool thing was that
you know, I learned how to clean from you know,
training for the few weeks that I was there at the
cleaning company.

[[7:57]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=477s)
But the even better thing
was that I learned a lot about how a local cleaning
company worked. And in that sense you know,
I learned why a local cleaning company could not
become huge like Homejoy is today and that's because
they have, you know, they're pretty old school
and they have a lot of things,
just from anywhere from booking the customer to
optimizing the cleaner schedules was just done very
inefficiently. And so there is, so, if you
are in a situation like mine where you know, there's a
service element to it, you should go and do that
service yourself.

[[8:38]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=518s)
You know, if your thing is
related to restaurants you should become a waiter it's
really to you know, if it's painting you know
become a painter kind of get in the shoes of your
customers from all angles of what you're trying to build. The other thing is there's
also levels of obsessiveness that you should have with it
too as well. You should be so obsessed to
know what everybody in the space is doing. And it's things like, you
know, running a list of all the
potential competitors or similar types of companies,
Google searching it, and clicking on every single
link and reading every single article
from like, search result 1 to 1,000.

[[9:17]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=557s)
You know, I found all
potential competitors, big and small, and if they're public, I would
go read their S1's, I would go read all their
quarterly financials, I would, you know, sit on
the earnings calls. There's, you know, most of
these you don't get much out of it, but there's just
these golden nuggets that you'll find once in a while
and you can't, you won't be able to find
that unless you actually go through the work
of, you know, getting all that
information in your head.

[[9:45]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=585s)
So yeah, you should become
an expert in the industry. There should be no doubt
when you're building this that you are the expert so
that people will trust you when you're building this
product. The second thing is identifying customer
segments. So you know, ideally at the
end of the day, in the end game, you built a
product or a business that everybody in
the world is using. But realistically in the
beginning you kind of want to corner off a certain
part of the customer base so that you can really optimize
for them, and that's just you know, it's just about a
matter of focus and a matter of you know, just catering
towards whether it's teenage girls or whether
it's you know, soccer moms.

[[10:25]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=625s)
You would just be able to
you know, like I said focus a lot on
their needs. And, lastly before before
you even create the product, before you put code down,
you should really storyboard out the ideal user
experience of how you're, how you're gonna solve the
problem. And that, and that's not
just meaning, you know, the web site itself, it's
meaning, you know, how does the customer find
out about you. You know, whether it's, you
know, it could be through an ad or
through word of mouth or whatever, so they find out
about you.

[[10:58]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=658s)
They come to your site, they
learn more about you, what's all that text say, what are
you communicating to them. So the actual, when they
sign up for the product or they purchase the service, what are they actually
getting, to after they finish using
the product or after they finish using the
service. What's you know, there's
sort of like an evaluation period,
like they leave a review, or they leave comments or
whatnot, and just being able to go through that whole
flow and visualize in your head, like just envision
what the perfect user experience is and then put
it down on paper and then put it into code, and
then start from there.

[[11:35]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=695s)
So you have all these ideas
in your head now, you kind of know what the
core customer base you want to go after is. And you know like everything
about the industry, what do you do next? So you start building your
products. And you know, the common
phrase that most people use these days is you should
build a minimum viable, the MVP, minimum viable
product. And I know I'm viable
because I think a lot of people skip
that part, and they just go out with a
feature and then the whole user experience in the very
beginning like is flat.

[[12:09]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=729s)
So the minimum viable
product pretty much means you know, what is the smallest feature
set that you should build to solve the problem that
you're trying to solve. And I think if you go
through the whole storyboard experience, you can kind of
figure that very quickly. But again you have to be
talking to users right, potential users, you have to
be seeing what exists out there
already and what you should be building to solve
their immediate needs.

[[12:38]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=758s)
And the second thing is,
before you put in things in front of a user
you should really have your simple product positioning
down. And what I mean by that is
that you know, you should be able to go to
you know a person, and you should be able to say,
hey you know this does x, y, and z within a sentence. And so for example you know,
at Homejoy we started off with something actually
super complicated.

[[13:04]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=784s)
We're like we're an online
platform for home services. We started with cleaning and
you can choose you know, blah, and it just went off
for paragraphs and paragraphs. We were present and we want
to you know potential users to come
onto our platform. They just get kinda get
bored after that first few sentences. And so what we found out was
that we really need this one liner, the one liner is very
important an it kinda describes the functional
benefit of what you do, you know, in the future when
your trying to build a brand you should, you know, be
able to describe, you know, what are emotional benefits
and stuff like that.

[[13:40]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=820s)
But, you're starting with
new users, you really need to tell them what they're
gonna get out of it. So we simply, after we
changed our positioning to get your place clean for $20 an hour, then everyone
got it, and we're able to get you know users to, users
in the door that way. So you have a MVP going out
there now how do you get your first few
users to start trying it. So your first few users
should be you know, the obvious people, the people that you're
connected with.

[[14:13]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=853s)
You should use it obviously,
you and your co-founder should be
using it. Your mom and dad should be
using it. Your friends and co-workers
should be using it. Beyond that you wanna get
more user feedback, and so you, and I've listed here
kind of some of the obvious places to go to. And depending on what you're
selling, you know, you can take your pick of
the, pick of the draw here. So online communities
there's, you know, on Hacker News now, there's
the show HM.

[[14:42]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=882s)
That's a great place
especially if you're building tools for
developers and things like that. Local communities, so if you're building consumer
product, you know, there are a lot of
influential local community mailing lists, especially
those for you know, parents, so those are places you
might want to head up to. okay. So when you go to by the
way, home joy, we actually tried all of
these. So, we use it ourself, that
was fine, I mean we were on a cleaner,
so that was pretty easy.

[[15:14]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=914s)
And then our parents lived
in Milwaukee and so we were basically not
used to that in the work. Friends and coworkers are
kinda like in San Francisco and else
where, so we didn't have too many of
them use it. So we actually, if we ended
up in a dead end of, not being about to
convince many people to use this in the beginning. So what we did was because
we are in Mountain View, some of you might know on
Caster Street they have street fairs there during
the summer time.

[[15:40]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=940s)
And so we'd go out and basically chase down people
and try to get them to book a
cleaning. And almost everyone would
say no. Until one day, we just took
advantage. You know, it was a very hot
and humid day. And what we noticed was, you
know, and this was like any, at any
fair people you know, there might be arts and
crafts and things like that. And random people will you
know, gravitate towards that, but everybody gravitates towards
the food and drink area.

[[16:04]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=964s)
Especially on a hot day. So what we did was, okay, we
figured we need to get in the middle of that, and by
getting in the middle of that we just took water
bottles, froze them and then we started handing out
free bottles of water that were cold, and people just
came to us. I think we just basically
guilt tripped people into booking cleanings. But the proof in the pudding
was that I figured most of those people were guilt
tripped into doing it, but, when they went home
they didn't cancel on us.

[[16:34]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=994s)
Well, some of them did, but, a maj, majority of them
did not. And, so, we felt, like, I, I
thought, okay, that's good I gotta go clean
their houses, but, at least, you know, there's something
we're actually solving here. so, and, you know, I don't
suggest, I think showing up the
fares, or another start up in the last batch, I forgot
their name right now, but they, they, they, they
showed up, they, they were selling
shipping type products.

[[17:07]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1027s)
Or were trying to replace
shipping products or the content and mailing
stuff. And so they would show up to
the U.S. Postal Office and find people who were trying
to ship products. And just take them out of
line. Try to get them to use your
product. Have them ship it for you. So, you just have to go to
places where people are going to really show up,
and, you know, your conversion rate is
gonna be really, really low, but to go from zero to one
to three to four, these are the kind of things, you
might have to do.

[[17:35]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1055s)
Okay. So, you got some users using
you. Now what do you do with all
these users? Customer feedback. So, one, the first thing you
should do is make sure there's a way
for people to contact you. So, support@homejoy.com. Ideally there's a phone
number, and if you hook up a phone number, one really
good idea is to, make sure that, you have voice mail or
something like that, so you don't have to be picking
it up all the time.

[[18:12]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1092s)
But in any case, a way for
people to get inbound, to get inbound feedback is
good, but really what you should be doing is going out
to your users and talking with them, you know. Get away from your desk and just get out and do the
work. It seems like a slog and
it's going to be a slog, but this is where you're going
to get the best feedback ever for your product. And this is gonna teach you
on what features you need to completely change, get rid
of, or what features you need to
build.

[[18:40]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1120s)
And so, one way to do this
is to send out surveys, you know, to get reviews after
they've used the product. This is okay, but generally,
you know, people are only gonna respond if they really
love you or really hate you. And, you never get like the
in between, So kind of get in between not get all
the extremes is to go out an actually meet the person
that is using your product. And, it's not a good idea
to, you know, I've seen people
go out meet the user and they sit there and it's like
a laboratory and it's like an inquisition
almost?

[[19:18]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1158s)
And you're kind of just like
poking, and poking, and poking at them like why'd
you do that? Why'd you do that? That's not going to give you
the best results. What you should really do is
make it into a conversation. Get to know them, get them
to feel comfortable, because you want to get them
at a level where they are, they feel like, you know, they should be honest with
you to help you an, an, and improve, improve things
for you.

[[19:40]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1180s)
So I found that actually
taking people out for drinks and stuff like that
was a very good way to do that. I'm not sure if all of you
are old enough to do that, but you can take them for
coffee. So another way, another thing you should be
tracking is. How are you doing in
general, like from like the macro
perspective. And the best way to do that
is by tracking customer retention. That is, the number of
people that came in the door today, how many are coming
back tomorrow, the next day, and so on and so forth.

[[20:11]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1211s)
Usually over time you're
kinda looking at, you know, monthly retention
so. You know, people who came in
the door today are they still using it next month
and so and so forth. The problem with that
metri,c is that it's you know, it takes forever to
collect that data. And you don't have, sometimes you don't have a
month or two months or three months to, you know,
to figure that out. So good leading indicator is
actually collecting reviews and ratings like five star,
four star reviews.

[[20:37]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1237s)
Are collecting some notion
of NPS which is Net Promoter
Score. So you're basically asking
them from a rating from zero to
ten, how likely are they to
recommend you to a friend. And calculating the NPS. And so over time what you'll
see is, as you're building a new
feature, is you should be able to see that the reviews
or the retention is going up over time which means you're
doing a good job. If it's going down, you're doing a bad job, and
if it's kind of staying the same that means you
probably need to go out and figure out what new things
you should be building.

[[21:09]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1269s)
The other thing is, I'll get to the qualitative
thing later, but the one thing you should be
worried of is the honesty curve, which is some people
will just lie to you. So, I mean, this is like degrees of separation
from you, and this is like level of
honesty. Like so here it's, here this
is your mom.

[[21:40]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1300s)
This is like your friends of
friends and here's like random people. I don't know if you can all
see this but, so you're mom is going to be
you know. They, she should use your
product, but she's going to be proud of
you anyway, and so she'll maybe be honest like
this much. And your friends will, you
know, they'll be pretty honest
with you and give you feedback because
they care about you. By the way, this is assuming
it's a free product that you're
giving them.

[[22:10]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1330s)
>> And. Then over time, like as you
get more and more random, these people don't even know
who you are, it doesn't go like this really, but it
kind of goes like this. Where people don't care
about giving you feedback they just like okay
here's a survey, ta, ta, ta, tat and so you should take this into consideration when
getting user feedback. Now let's say you make, you
pay. It's a pay product, right? Well let's just do this in
green.

[[22:35]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1355s)
So, the paid, you know, your mom is gonna be like
down here. Like, she's just gonna lie
to you and say, you know, she's just gonna feel sorry
and say, this is a great product
of course. But then you, kind of goes
like this, right? Which is to say that your
friends are kinda gonna give you the right, they're,
they wanna support you and give you the right feedback. But it's actually these
random people up here that, you know, if they, if they really don't think
what they paid for was worth it, they're gonna
really tell you.

[[23:09]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1389s)
Because you know, it's money
out the door. And so, this is another way
of saying you're going to get the best feedback. Obviously, down here, you're
gonna get more feedback if you just make someone pay
for it. That's not to say you
should, you know, and the first time make out make
people pay for it. That it is to say that you
should, if you're going to build a product that you're
going to eventually need to, you know, they're going to
pay for the software or for the hardware, whatever,
you should do that.

[[23:40]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1420s)
Get to the point where you
can do that very, very fast. Because then that's when you
get the real meaty stuff to help
you in the future of how you can get more paying
users in the door. All right so, you're getting
a lot of feedback and, what do you do before you
laun, officially launch the
product? So what you want to do is, you always want to be
building fast, right? And you want to be
optimizing for this stage of growth.

[[24:11]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1451s)
That is you, you know, you might have ten
users at this point. Don't, theres no point in
trying to build features for the point when you have a
million users. You want to optimize for the
next stage of growth, which is gonna be ten to a
hundred users. What are features you really
need for that and just go with that. Some times. And basically on the slide
is just many ways of stating that notion. Manual before automation.

[[24:38]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1478s)
One of the things that I
found when building a market place is
that process is very, very important over time as
you scale. But you need not try to
automate everything and create software to just have
robots just run everything. What you should really do to
understand what you should really build, is to
manually do it yourself. And an example of this is
when we started taking on cleaning professionals
onto our platform.

[[25:08]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1508s)
We would have them,um, we would ask them a bunch of
questions. Over the phone and then in person we ask them a
bunch of questions too. And then they would go to a
test clean and then they would get on
boarded to our platform if they're good enough. And so this took a lot. During all this question
askings for that many candidates. You know, we had about a 3
to 5 % acceptance rate. And so you can imagine all
the people we were talking to at the
beginning of the funnel that never even made it onto
the platform.

[[25:41]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1541s)
But what happened over time
was that we learned certain
questions. That were asking, were, that
were indicators of whether
they're gonna be a good, or a bad, performer on the
platform. We, threw just like data
collection and just you know, looking at,
looking at everything, we could just ask on an
online forum. So that's when we put on,
put in online application. They could apply and then we
would ask them maybe several of the questions during the
inter, personal interview.

[[26:13]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1573s)
So it's, if you try to
automate things too fast, then you run into this
problem, potential problem of, you
know, not being able to move quickly on trying to iterate
you know with things like questions on an application
and stuff like that. And the third point here is
temporary brokenness is much better than permanent
paralysis. By that, what I mean is you
know perfection is irrelevant
during this stage. You should, when you get to
the next stage of growth, like what you're trying to
maybe perfect in this one stage, is probably going to
not matter anyway, and so do not worry about all
the edge cases when you're building something.

[[26:52]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1612s)
Just worry about the generic
case of who your core user is gonna be, and
then as you get bigger and bigger, bigger, the volume
of those edge cases will
increase over time. And you'll want to, you
know, build for that. And lastly, beware of the
frankenstein approach, which is great. You talk to all these users, they give you all these
ideas, you know, the first thing your gonna
wanna do is go build every single one of them, and go show them the next
day and, make them happier.

[[27:23]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1643s)
You should definitely listen
to user feedback but when someone tells you to
build a feature, you shouldn't go build that
right away. What you should really do
is, you know, get to the bottom of why
they are asking you to build the feature. It's usually. Usually what they're
suggesting is not the best idea. But what they're really
suggesting is, I have this other problem
that you either created for me while using the product. Or, you know, I really need
this problem solved before I'm ever going to pay to use
this product, and so, figure that out first, instead of
piling on a bunch of features, which then hides
the problem altogether.

[[27:56]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1676s)
So, you have, so you have a product, that
you're ready to show, and. Some people at this point
will continue building their product and not ship it at
all. And, I think the whole idea
of being stealth and perfecting the product to no
end is. Is the idea that, you know,
imitation is cheaper than innovation in terms of
time and money and capital.

[[28:37]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1717s)
And so, I think everyone
should just always assume in general like, there's gonna
be, if you have a really good
idea. No matter when you launch. Someone's gonna, someone's
gonna,be you know, someones gonna fast follow
you. Someone's gonna execute, as hard as they possible can
to catch up with you. And so, there's not point in
holding out on all the user feed back that you can get
by getting a lot of users. Because you feel like, you
know, you feel paranoid that someones' gonna do this to
you.

[[29:06]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1746s)
And I hate to keep harping
on it, but this is things that I
see today with founders, is something I went through
as well. And I think unless you're,
unless you're building something that requires
hundr, like tens of millions of
dollars just to start up, there, there's really no
point in, in waiting around to launch
your product. So say you have something
that you feel ready to get lots of users on. So what do you do at this
point?

[[29:34]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1774s)
So I'll look at my time, so. >> 20 minutes.
>> 20 minutes? Okay. So, I will go over, various types of growths in
the next slides. But the one thing to note
here, early on when you are trying
to get, when it's just you and your
co-founder and maybe, like, a couple other
people building, you're not gonna be a, you know, create
a team just for growth. It, it's gonna be one person
and one person only.

[[30:02]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1802s)
And so, you need to really
focus and you need to, you should only, you're
gonna be tempted to try like five different strategies at
one time. But really, what you should
do is take one channel and really execute on it for an
entire week, and, and just focus on that. And then if that works, continue executing on it
until it caps out. If it doesn't work, then
just move on. By doing this, you will feel
more certain that, that channel that you were
working on, that initial hypothesis is
wrong.

[[30:34]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1834s)
You'll be, then if you tried
only working a third of your time on it over the course
of, three or four weeks. So, learn one channel at a
time. Second is always be, when
you find channels that work, you find strategies that
work, always be iterating on it. You can potentially give it
to some, like create a playbook and give it to somebody else to
iterate on it. But these channels always
change. You know, anything from
Facebook ads to, even Google ads, to you
know?

[[31:05]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1865s)
But, the distribution
channels the environments that you don't control,
change all the time, and so you should be always iterating optimizing
for that. And lastly, in the beginning
you're probably, when you see a channel that
fails you, just get rid of it and go on
and move on. There's many other things to
try. But over time, go back to those channels
and look at it again. And so, what I mean by that
is an example is, in the beginning at Homejoy,
we had no money.

[[31:34]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1894s)
When we tried to do, we
tried to buy users from Merry Maid,
not from Merry Maids, that's just an example of a
competitor, but. We tried to buy Google ads
to get users in the door quickly. And what we found was that
Merry Maids, Molly Maids, all these other
national companies, they had more money than us. They were making out a lot more money on the job
than us. And so they were able to pay
for users at a much higher at a much higher, at a much
higher,they were able to acquire them at a much
higher cost than us.

[[32:09]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1929s)
And so, we couldn't afford
that, and we had to go to another
channel, which turned out to be
something else. But today we make more money
on the job. We're much better at certain
things, and so we should probably
revisit the idea of buying Google ads and buying, going
to the S.D.M. Channel. And so what that's what I
mean by that. And the key to all this is
creativity. Performance marketing or
marketing or growth in general can be
very technical.

[[32:37]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1957s)
But it's actually technical
and you have to be creative
because if it wasn't, if it was really easy and bland, like everyone would
be growing right now. And so, you always have to
find, like, that little thing that no
one else is doing and do that to the extreme. So, here are three types of
growth when yeah, three types of
growth, sticky, viral and paid
growth and hopefully, I'll get enough time to talk
about all of this.

[[33:11]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=1991s)
So really, briefly, sticky growth is trying to
get your existing users to come back and pay you more
or use you more. Second is viral growth. So that's when people talk
about you. So, you use a product, you
really like it, then you tell ten other
friends. They like it and that's
viral growth. And the third is paid
growth. So, if you happen to have
money in the bank, you are going to be able to
perhaps use part of that money to buy growth.

[[33:41]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2021s)
And the central theme I'm gonna go through is
sustainability. There's a lot of, by
sustainable growth I mean, you're basically not a leaky
bucket. Money you put in or time you put in, has a good
return on investment on it. So, sticky growth is like I
said, getting existing users to
keep buying stuff. So, the only thing that
really matters here is that you deliver a good
experience, right? If you deliver a good
experience, people are gonna keep
wanting to use you.

[[34:13]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2053s)
If you deliver an addictive
experience, people are gonna keep
wanting to use you. And the way to measure this
and to really look at this and how you're doing over time
of whether you are providing good sticky growth is to
look at the CLV's and retention cohort analysis. Now, does anyone not know
what cohort analysis is, or should I go over it? >> Yeah. >> Okay.
So I'll go over it. Okay. So CLV is some people call
it LTV.

[[34:43]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2083s)
It is called customer
lifetime, which is, basically the
amount of the net revenue that a customer
brings in the door for you over a certain amount of
period. So, a 12 month CLV is how
much net revenue does a customer give you
over 12 months. Sometimes people look at
three months, six months, and so on and so forth. So, when I say cohort,
basically, what you're looking at is,
this is time.

[[35:15]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2115s)
So, let's just call this,
yeah, time. So, and this is percent of
users coming back to you. So at time zero, right, a
period zero, we're at a hundred. I'm using 100%. So, cohort is another name
also for like customer segments and
stuff like that. So you can, like, you might look at the
female versus male cohort.

[[35:48]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2148s)
People in Atlanta Georgia
verses people in Sacramento California. But, the most common one is
by month. So, cohort equals month and
lets just say for this exercise, we are
looking at like March of, I don't know, 2012. So, March 2012, 100% of
people, you'll have like, that means n equals 100
people.

[[36:18]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2178s)
So, 100% of the people,
obviously, are using your product because, that's the
definition. Now, one month later, you
might have, this scale is not right, but 50% might come back and so,
you come here. Now, in the second month,
how many people that came in March, come back two months
later? And that might be down here. And, so, over time, you'll have a curve that
looks like this.

[[36:52]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2212s)
There's always some initial
drop off, you know. The reasons why people don't
stay after their first use is, it wasn't worth it, had
a bad experience, stuff like that. And then, over time what you
want is, you want this to flatten out over time, so
that your turn basically goes to 0% that means you
attrition out less, and less users over time. And these over here, kind of
become your core customers, these are the ones that are
like sort of staying with you for a long time.

[[37:27]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2247s)
And now, court analysis or using this as a way to show
if you have sticky growth or not is now, say you're, say
we're one year later and you've built a bunch of
stuff right? You graph out the same thing
and hopefully what you'll see is that you have a curve
like this. That is in the first period
even more people than 50% came back to you and
more and more people are sticking
with you.

[[38:02]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2282s)
A really bad, retention
curve looks like this, which is like, after the first use
they just hate you so much, no, like no one even
comes back. It's just like zero, right. And, I don't know what kind
of business that is. I mean it's obviously a
shitty business, but like I can't explain a good
business that has a retention curve like that. So anyway, so over time as
you are thinking of strategies to increase this
curve, like keep making it go up
and up and up, you want to basically
look at this analysis, over time to see if that
strategy is working for you.

[[38:41]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2321s)
Okay, does that make sense? Okay, cool. The second kind of growth is
viral growth and like sticky growth you need to also
deliver a good experience. But on top of that you need
to deliver a really, really good experience,
like, what's going to make these people shout out loud
on Twitter, on Facebook or whatever and tell all their
friends and email all their friends and
family members about you. You have to really deliver a
good experience.

[[39:10]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2350s)
Combined with that is, u
need to have really good mechanics for the referral
program itself, like, you have a hundred customers
who really wanna talk about you now, how are they
going to talk about you? So, in that sense a viral
growth, the viral growth strategy is
all really about one building good experience,
but if you have that, it's how do you build a good
referral program. And so I've listed the three
main parts of that.

[[39:34]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2374s)
One is the customer touch
points, which is, where are people, learning that they can refer
other people. So, that might be just,
after they book, or after they sign up there is
a, usually you see these like,
right after you sign up for, for whatever reason most,
for whatever reason most people just immediately tell
you to invite other friends, even though you've never
used the product before. And so, but that's a
customer touch point, is just right after you sign
up.

[[40:01]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2401s)
A better one is after they
use the product after a while, and you see that
they're highly engaged, then to show them that link
and get them to send it out to
everyone. Another one is if you're doing more of a
platform type play like, for Homejoy we actually go
inside their homes. So now, the customer touch
point is when the cleaning professional is inside the
home, they can have a leave
behind, and, we can show them
something there too as well.

[[40:24]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2424s)
so, you wanna basically put
the customer touch points and put the actual, link or
whatever it is, how they're gonna refer all their
friends at a point in time when they're highly engaged
and they're loving you. Second is program mechanics. And so that's where, like,
the most common thing that I've seen is $10 for $10,
that is, you get $10 if you invite your friend and they
use it and they get $10. And so, you should try
different types of mechanics in that sense and try to optimize for whatever
works for you.

[[40:57]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2457s)
You know, it could be 25 for
25, it could be ten for zero, it
could many of these things. And lastly it's when the,
when your friend clicks on the link, on your referral
link, when they come back to the site, it's very
important to really optimize that conversion flow of how
they're going to sign up. And so sometimes you need to
just sell them in a different manner, or
upsell that their friend has suggested they use this and
so on and so forth.

[[41:26]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2486s)
So, all these combined, you
need to really play around with these on
different dimensions and come up with a good referral
program. And, lastly, it's paid
growth, so, examples of paid growth is
this right here. And these are the most
obvious ones, but I'm sure you guys can think
of more. And paid growth is
basically, you happen to have money,
you can spend. You might have credit cards,
whatever, but you can spend something to
get users.

[[41:58]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2518s)
So, the correct way to think
about pay to growth is that, okay you're going to put
money. You're gonna risk putting
money out there, what are you gonna get in
return? The simple way to think
about it is, is your CLV, your customer lifetime, the
amount of money, the net revenue, the amount
of money that people, that your customer returns
back to you, is it more than your CAC? And your CAC is an
abbreviation for customer acquisition cost.

[[42:26]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2546s)
So, an example is, you pay,
actually the slide here has an example here, so
say you run a bunch of ads. These are four ads. Over 12 months, the customer's worth $300 to
you. Each one of these ads, when
you click on it, the CPC costs different
types of money. And then, when they click on
the ad, then they have to come to your site and sign
up or buy something, and the conversion rates are
different for all these ads.

[[43:00]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2580s)
And then, the CAC is
calculated simply by the CPC divided by the
conversion. And so, you see that there's different acquisition costs
for different types of ads. And to determine whether,
that is a good ad or a bad ad, all you have to do
is, CLV minus CAC. Is it more than zero? If it's at zero then you've,
that's fine, but hopefully it's actually more than zero until you actually
are earning a profit on it. So, we see that, despite the
sales remaining the same and the conversions being higher
and lower, there's sometimes, some ads
that might seem good, actually don't seem so good
at the end of the day.

[[43:42]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2622s)
Now, the advanced way of
looking at it is you can look at this for your whole
entire customer base for aggregating all your
customers together. But the better way of looking at it is to break it
down by customer segments. So, if you have for example,
if you're building a marketplace, I don't know,
for country music, the CLV's of someone in
Nashville Tennessee is going to be much larger than the
CLV's and latent value of someone in
Czechoslovakia.

[[44:13]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2653s)
So, or, I just assume that's
the case anyway. So, you'll need to, you want
to make sure that when you're buying ads for these
different types of cohorts, or these types of customer
segments, that you know what the
differences are. You don't wanna mix like,
everything together. So, the last one on payback
time is sustainability. I think a lot of businesses
get in trouble, and it turns into a bad business
when they start spending beyond their means.

[[44:50]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2690s)
And it has a lot to do with
risk tolerance, or how much risk you're willing
to take on. So, when you look at CLV's
of these. Let's just suppose you get a
customer a customer who's worth $300 after 12 months,
that is, in the first month they're
worth $100. If you wait til the end of
the 12 month period, then they give you the other
$200. But if, in the first period
you're actually paying $200 for them, then you're
in the whole for $100 until the end of the 12
month period.

[[45:30]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2730s)
And that's when you start
getting into potentially unsustainable
growth, which is something could happen where
at the end of the 12 months, you don't actually get the
$200 from the customer, and you end up in a very bad
situation and essentially just at the end
of the day, you could be running out of
money. And if you're doing this
with credit cards, you will definitely find
that you're gonna have to, you know, declare bankruptcy
very soon.

[[46:02]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2762s)
So again, payback time is
very important, a safe one to go with is 3 months if
you have very high risk, if you're very risk loving,
maybe 12 months is better. Beyond 12 months is very
much an unsafe territory. How much time do I have? A minute, okay. So, I'll just go into this,
the art of pivoting.

[[46:35]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2795s)
So a lot of people ask me,
Homejoy went through, Homejoy in its current
concept is literally the thirteenth
idea we fully built out and try and execute on and try
to get customers for. And so, a lot of the
questions I get is how did you even, like,
get to that thirteenth idea? And how'd you decide when to
move on. And so the best guidance I
can give on that is, to kind of look at these
three criteria, which is, once you realize you can't
grow, or once you realize, you are despite building out
all these great features and talking to all these users.

[[47:15]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2835s)
None of them stick, or you
don't have any good high retaining
users, or the economics of the business just doesn't
make sense, then once you make that realization, you
just need to move on. And I think the trickiest
one is probably the growth one, because there's so many
stories out there where the founder stuck with
the idea, and then, after three years, all of a
sudden it started growing. So, the trick here is
basically, what you really should do
is, you should have a growth
plan when you start out, which is you should ideally
just have, what is an optimistic but realistic
way to grow this business?

[[47:56]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2876s)
And so, it might look
something like this. And this is T and this is
number of users. So, in week one you want,
you just want one user. In week two you want maybe
two users and so and so forth. And you can keep doubling up
and up. So, in week one you should
basically do as much as possible, build whatever you have to
build to get that one user. And then in week two, so on,
so forth, you build whatever you need to get two users,
four users, eight users.

[[48:31]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2911s)
In the beginning it should
be fairly, if you have a product that people
actually wan,t you should be able to maintain this growth
curve pretty easily just by walking around and manually
finding people. It's when you get to like,
you need 100 users a week, or you need some of these
more, you need the growth
strategies to start working. And so, what I tell people
is usually if you're fully executing on your product,
and you're really working really, really hard,
then, if you go three or four weeks in a row of no
growth, backwards growth, then either, then it's time
to maybe consider a pivot, in the sense that not
starting over, like, completely come with a new
idea.

[[49:10]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2950s)
But you're probably
fundamentally doing something wrong, because, in
that early stage of a start up, you should
always be growing. And, so, it's not. And this is optimistically
what it looks like. And this is like, kind of
the growth curve I set forth and put out when I started
Home Joy. But really what it looks
like is like this. And so you wanna make sure
that when you're in a low like over here, that
you don't just stop, right?

[[49:35]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=2975s)
And that's why you should
wait two to three weeks,as long as you keep working
hard, you'll eventually get back here and you'll see a
trend like this over time. Cool, so that's pivoting and that's it. I can take questions at this
point. >> Answer one question. >> Yeah.
One question? >> So one question online
was, if your users have a product that they're already
somewhat comfortable with, how do you get them to
switch to your's?

[[50:11]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=3011s)
>> Right so, there's a
switch over costs. I'll tell you the example of
Homejoy. So, Homejoy, we actually were creating a
new market in the sense that a lot of our initial users
never had cleaning before. So, it was pretty simple to
get them on board. And a lot of people who have
cleaners already, really trust their cleaner
and they will. To get them to come and use
something else is actually, probably the most difficult
task in the world.

[[50:42]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=3042s)
And so, when you're billing
things and trying to get people to switch over to
you, what you really need to do is find the moments where
your product or what your offering is much
better or very much differentiated from the
existing solution they have. So, an example is someone
who had a regular cleaner and maybe they had a party
one day and they needed a cleaning
almost the next day. And because Homejoy, in most of the areas has
next day availability, they would just come to
Homejoy and use it, because they knew they couldn't get
their regular cleaner.

[[51:09]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=3069s)
And once they start using
the product, then that's when they start
realizing the advantage, the little advantages of
using Homejoy which adds up to a big advantage. So, a lot of things are, realizing that, leaving cash
out, or leaving checks was really
annoying, and so billing through online payments was
more convenient. Being able to book, cancel,
and reschedule, according to your own schedule was very
convenient and so and so forth. And so, it's just, it's
really hard to, a lot of people when they
build the product, they're like, and these 50
things are better than, a little bit better than,
the existing solution.

[[51:49]](https://www.youtube.com/watch?v=yP176MBG9Tk&list=PL5q_lef6zVkaTY_cT1k7qFNF2TidHCe-1&index=4&t=3109s)
It's really hard, even if
the benefits outweigh the switch-over costs. It's really hard to actually
tell that to a user and try to get them to aggregate
all those benefits over many little things. It's better to just have one
or two things that clearly differentiate yourself from
the product so. >> Thank you very much. >> Yeah. >> That was awesome. >> Yeah? Okay.