4 ms·

Vetting a startup (or two): The systematic birth of WPEngine

34 points by revorad 16y ago

patio11 16y ago
I feel you on that story about pricing analytics. People ask me why I don't productize A/Bingo and pitch it to my blog readers. This is a big reason why: "A/B testing made you thousands last year? Wow, great, I'll pay $9 a month for that. $19?!?!? Stop breaking my balls, man!" (I give similar advice to startups asking about marketing analytics software: startups make poor customers, figure out a way to help the VP of Marketing somewhere and they're immune to price.)
iworkforthem 16y ago
Like the post said it, the key lies in having a killer feature that users are willingly to pay for, then yes it could be right time to start the biz. At the same time, users requirements/expectations evolute with time, last year killer feature might not be this year's. I think the ability to communicate with users to understand what they want and how & why your biz is relevant to them is critical.
notahacker 16y ago
Did you try turning the value proposition of the marketing tool on its head by pitching it to print publishers desperate to offer evidence of the effectiveness of print advertising to their advertisers (as the advertisers shift their ad spend towards analytics-supported online services)?
damoncali 16y ago
This is why I cringe every time I hear someone say "Ideas are worthless - it's all about execution." Coming up with a worthwhile idea is hard work, and that work has value. As someone who has executed a bad idea to death, I've come to appreciate how much you have to get right before you start in order to be successful.
- krschultz 16y ago
  I'd argue that this story supports the "idea is worthless" hypothesis. Your idea is the initial problem you want to solve or new feature you came up with you'd love to make a product around. The business model is built upon that initial idea, but it is part of the execution. The idea itself is worthless, the business model built on the idea (or lack of one) is valuable. That might seem like splitting hairs, but I gaurentee most ideas don't translate directly to a business model without a whole lot of work. And that work is part of the execution. If you don't do that work (and get stuck building on a bad business model), you still have an idea, you just didn't do the proper execution.
  - damoncali 16y ago
    I was defining "idea" as "what you have before you start coding". I don't think we disagree.
    - swombat 16y ago
      If you have a defined, detailed, iterated, field-tested business model before you start coding, then you have more than just an idea, by definition.
- revorad 16y ago
  Damon, please share your story. It could help a lot of people.
  - damoncali 16y ago
    It basically reduces down to "sell it, then build it." I'm ashamed to say that I've actually done this a couple times (didn't learn from the first one, apparently). We skipped the process that Jason talks about, built something, and then tried to market it in various trial-and-error ways. Surely we could find someone who would want it at a price that would make us happy? We tried different media, different target markets, biz dev, etc. Only to find out that the idea was just a stinker. That takes a whole lot more time, money and emotional investment that can be hard to walk away from than really digging into some potential customers before you start coding. It's much, much easier to scrap a crappy idea before you've built it. It's almost impossible to scrap a good idea once it's been validated. I would say that among the people I know who have been very successful starting companies, a very healthy majority sold the product before building it, intentionally or otherwise. There are a few who find the right market with their gut instincts - my hat's off to them, because I've tried that and failed miserably.
- ig1 16y ago
  Validating the idea is a key part of execution. You can't differentiate between a bad or good idea without validation (market research, testing, etc.)
doorty 16y ago
Great point in this article. I've ran into this a couple times with startups, where the idea solves a problem and would help clients financially, yet it just doesn't work out. You really do have to pry into those potential customers to get them to put their money where their mouth is and if they don't happily do so then you're wasting your time. Made a note of this on my blog: http://doorty.com/vetting-a-startup http://doorty.com/vetting-a-startup
revorad 16y ago
I bet he could sell analytics as a premium add-on to customers of WPEngine.

34 points by revorad 16y ago

I feel you on that story about pricing analytics. People ask me why I don't productize A/Bingo and pitch it to my blog readers. This is a big reason why: "A/B testing made you thousands last year? Wow, great, I'll pay $9 a month for that. $19?!?!? Stop breaking my balls, man!" (I give similar advice to startups asking about marketing analytics software: startups make poor customers, figure out a way to help the VP of Marketing somewhere and they're immune to price.)

iworkforthem 16y ago

Like the post said it, the key lies in having a killer feature that users are willingly to pay for, then yes it could be right time to start the biz. At the same time, users requirements/expectations evolute with time, last year killer feature might not be this year's. I think the ability to communicate with users to understand what they want and how & why your biz is relevant to them is critical.

notahacker 16y ago

Did you try turning the value proposition of the marketing tool on its head by pitching it to print publishers desperate to offer evidence of the effectiveness of print advertising to their advertisers (as the advertisers shift their ad spend towards analytics-supported online services)?

damoncali 16y ago

This is why I cringe every time I hear someone say "Ideas are worthless - it's all about execution." Coming up with a worthwhile idea is hard work, and that work has value. As someone who has executed a bad idea to death, I've come to appreciate how much you have to get right before you start in order to be successful.

krschultz 16y ago
I'd argue that this story supports the "idea is worthless" hypothesis. Your idea is the initial problem you want to solve or new feature you came up with you'd love to make a product around. The business model is built upon that initial idea, but it is part of the execution. The idea itself is worthless, the business model built on the idea (or lack of one) is valuable. That might seem like splitting hairs, but I gaurentee most ideas don't translate directly to a business model without a whole lot of work. And that work is part of the execution. If you don't do that work (and get stuck building on a bad business model), you still have an idea, you just didn't do the proper execution.
- damoncali 16y ago
  I was defining "idea" as "what you have before you start coding". I don't think we disagree.
  - swombat 16y ago
    If you have a defined, detailed, iterated, field-tested business model before you start coding, then you have more than just an idea, by definition.
revorad 16y ago
Damon, please share your story. It could help a lot of people.
- damoncali 16y ago
  It basically reduces down to "sell it, then build it." I'm ashamed to say that I've actually done this a couple times (didn't learn from the first one, apparently). We skipped the process that Jason talks about, built something, and then tried to market it in various trial-and-error ways. Surely we could find someone who would want it at a price that would make us happy? We tried different media, different target markets, biz dev, etc. Only to find out that the idea was just a stinker. That takes a whole lot more time, money and emotional investment that can be hard to walk away from than really digging into some potential customers before you start coding. It's much, much easier to scrap a crappy idea before you've built it. It's almost impossible to scrap a good idea once it's been validated. I would say that among the people I know who have been very successful starting companies, a very healthy majority sold the product before building it, intentionally or otherwise. There are a few who find the right market with their gut instincts - my hat's off to them, because I've tried that and failed miserably.
ig1 16y ago
Validating the idea is a key part of execution. You can't differentiate between a bad or good idea without validation (market research, testing, etc.)

doorty 16y ago

Great point in this article. I've ran into this a couple times with startups, where the idea solves a problem and would help clients financially, yet it just doesn't work out. You really do have to pry into those potential customers to get them to put their money where their mouth is and if they don't happily do so then you're wasting your time. Made a note of this on my blog: http://doorty.com/vetting-a-startup http://doorty.com/vetting-a-startup

revorad 16y ago

I bet he could sell analytics as a premium add-on to customers of WPEngine.