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Most startups never make it past their first year, but for those that do I think this is the biggest problem they encounter. Especially if there's a sales team,
by hacknat 10y ago
Most startups never make it past their first year, but for those that do I think this is the biggest problem they encounter. Especially if there's a sales team, the temptation to say yes to prospective customers is enormous.
A lot of founders get tripped up by needing to show hockey stick growth as soon as they can, because they're usually top performers that are used to knocking expectations set on them out of the park. Saying yes to lots of people is an easy way to show the hockey stick in the first year, but it'll turn into linear growth pretty quickly. Congratulations you now own a consulting company, and your product team is groaning under the weight of enormous technical debt.
Your company is probably going to die now, because you're top engineers probably hate your product and vision.
I don't blame people though, because there really isn't a full proof way to avoid this. Sure, anchor customers can help, but how do you know when you really have anchor customers and when you're just saying "yes" to lots of ideas? In the end, IMO, it's totally subjective (building a great product). You just have to have a sense for it and be willing to fail quickly.
In my experience the best founders actually don't take as much signaling, at least explicitly, from their customers as you would expect. They have a maniacal vision, and they are following it. Their customer help give form to the sculpture, but the basic outline is set. If real hockey stick growth follows, so be it.