Jiva Technology

Something we never think about.

Amongst all the excitement of developing and rolling out a new product and entering a market, the focus falls squarely on attracting early customers, making them as excited as you are about the product and adding features that will bring in the next wave of enthusiastic early adopters. It’s all about delighting the early advocates and generating the buzz required to build early momentum. As someone once said to me, the first 1,000 users are the hardest.

And it’s true … to a certain extent. Because those early days are hard, you need the energy and commitment to believe the product and market into existence. Caution and concern are not all that helpful. But an outstanding blog post by Sahil Lavingia reminded me of a problem that I see more and more. One that lurks over the horizon ready to trap the unwary.

During that early phase of product release and user traction, you pay very little attention to what happens when you’ve attracted all the users you’re going to attract for your product. What happens when you sign up the 1,501st customer in a core market of 1,501 users? Like a rocket that has insufficient fuel or stages to reach escape velocity, you continue for a while and then slowly start falling back to earth. Lavingia is refreshingly honest about his experience and he performs a service to fellow entrepreneurs in talking about a topic that, well, most entrepreneurs don’t talk about. Loss aversion kicks in, no one wants to let go and some very hard decisions have to be made. It reminds me of all those micro messaging services, like Pownce, that emerged in response to the launch of Twitter. Most gave up early without the traction needed to keep going, but in the back of the mind, there’s always the story of Slack or Paypal to keep you going. Billion dollar successes that rose from failing projects.

It’s something to think about when you’re starting your new project. Being crushingly honest about exactly who will see value in what you’re doing in a detailed way, rather than a vague and generalised fashion. Focusing on the value of how that values delivered helps size the market in an honest way. It’s possible to build decent, profitable companies in small markets. But not in micro markets. Best to know that before you start. Just another thing to consider, alongside technology execution, marketing strategy, funding, competition, recruitment. Who’d be an entrepreneur?

 

Contact

Regus House
1 Friary

Temple Quay
Bristol
BS1 6EA
United Kingdom