Month: April 2019

Your iteration rate is the key to finding product-market fit for your app

For any entrepreneur launching an app finding product-market fit is a lot like finding the Golden Ticket; it’s rare, but when it happens it’s life-changing.

Unlike an enterprise business, when you build a consumer app your end-user can’t easily tell you what they want (vs. enterprise apps that are focused on solving a known problem or a pain point for clients). Think about it this way: Before the iPhone launched, no consumer research would point out the need for a touchscreen, keyboardless device. Before Snapchat, no consumer would say they wanted the ability to send ephemeral messages.

Consumers aren’t able to tell you what they want; this makes consumer products a shot in the dark. There is no guarantee if or when product-market fit can be found. It’s usually a long journey of continuous iteration.

And ongoing iteration is what gets you to product-market fit. Each iteration gives you one extra at-bat. Hitting a home run is easy if you can strike out 10o times instead of 3. Y Combinator’s Sam Altman said it best in this tweet:

Screen Shot 2019-04-01 at 4.14.45 PM

Finding product-market fit is hard. Look at how many consumer products Facebook and Google shut down even with their massive resources (remember FB Paper, FB Groups app, Google+ app?) Massive resources can help, but it’s not the most critical.

In the early days of Wattpad, despite only having a handful of employees, every day the product looked a bit different. We implemented new concepts in the morning, checked in the afternoon, measured overnight and killed it the next morning if it didn’t work out. That’s how we found product-market fit in many things. And that’s how we left our competitors in the dust.

Although finding product-market fit is freaking hard, it is also very fun and rewarding once you have figured it out.

Keep on iterating!

Masterclass Series: CEO, It’s Your Decision. Don’t Dodge

When you work at a startup, seeking advice and gaining buy-in from the broader team can help you move faster … until it becomes a crutch.

Recently, I bumped into an entrepreneur I invested in. He’s making some changes to the direction of his company, and after explaining them to me, I pointed out some of the potential issues. He immediately asked me: “So, do you want me to revert to the old plan?”

It was the wrong question to ask.

I explained to him that it doesn’t matter what I want. As CEO, with all the context, he’s the only one who can make that decision. As an investor, I’m not thinking about his business 24/7, but he is. It’s his company, and it’s his decision what he does with it (and only his decision). Investors should share their experiences and opinions, but they shouldn’t make decisions that affect the business.

Not long after, I had an investor friend contact me about one of his portfolio companies that’s going through a pretty rough patch. My friend said: “The CEO now blames the board of directors for making the wrong decision.” My ears perked up. This was a red flag and I told my friend as such.

A company’s board of directors only has one decision to make: Hire and fire the CEO. Inexperienced CEOs have a tendency to defer difficult decisions to the board or even other people in the company. It’s not uncommon to hear a newbie (or unconfident) CEO say something like “My recommendation to the board is …” This isn’t helpful. All this does is enable inexperienced board members to jump in and make decisions out of context. It’s tragic, really.

Obviously, I’m not suggesting that there is no value to be gained from consulting with your board: Every CEO has blind spots and can benefit from another perspective. But in the end, what happens in the business is always the CEOs call.

And it doesn’t always have to be the CEO who holds the ultimate decision-making ability (nor should it). I remember speaking with a senior leader at Wattpad, and the person said: “I would advise we do this …” I quickly reminded this person that they are the head of the business unit and the only person accountable for it. It was an important decision with huge implications across the company, so of course, I expected this person would engage with the broader team to think through the different scenarios and make sure all the bases were covered, but at the end of the day, the person was the leader, not an advisor.

These three conversations illustrate one critical point. Whether you’re a co-founder, CEO, technical lead, department manager or even individual contributor, you are the presumed expert in your role, so don’t dodge making tough decisions. Remember: You are not an advisor to your own job.