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JUMPSTART
JUMPSTART
Rolling Up Hills or Climbing Up Steps
Sometimes startups think
of progress as rolling up
a hill. You start off with
almost nothing: a first
iteration with no users and
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 instead
requires discrete steps to climb. Just as
in the physical world, after each step
you have a little place to rest and build.
The steps may lead you to an indirect
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 the professional
social media site, LinkedIn, and the
vacation rental site, Airbnb.
In 2003, LinkedIn’s founders sent
the first iteration to 350 of their
friends, then followed up with anyone
who didn’t create a profile and by
the time a month had passed, the
site 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 differ in
terms of what is needed for them to
provide value. For example, even if
there is only one member of LinkedIn,
it’s partially valuable, because visitors
can still view user profiles and learn
about their careers. In that way, early
LinkedIn functioned as 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. Its 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 Airbnb
had not had funding, it might not have
lasted long enough— or it 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
Instead of Airbnb’s progression of
improved conversions (professional
photography) and signups (Craigslist
spam), what steps could it 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 startup expert Joel
Gascoigne and startup entrepreneur
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 such as these could
have gotten enough people on the
network so that later on renting
becomes an option.
“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.”
I want to go a step further and propose a 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 current employment. What
jobs are growing? What are average
salaries? What cities have the most
opportunities for designers? No one
is using “LinkedIn,” and yet they are
able to provide value. Similarly for an
“Airbnb” with no users, the
founders could have looked
at data from AsiaXpat,
Craigslist, and other
Paul Orlando cofounded and
apartment listings to come
ran Hong Kong’s first startup
up with advice on what
accelerator, AcceleratorHK.
rental prices will do.
You may have a
He advises startups around
sophisticated view of what
the world on lean startup,
your startup will do. You may
customer development, and
have a grand vision. That’s
great. But if your startup
analytics. Paul now lives in
is unproven and no one
California and just published a
knows you exist, you need to
book called Startup Sacrilege,
consider your tactics.
For startups that require
which is written for startups
critical mass, how could you
outside of tech hubs.
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