Course  Startup School 2019
July 22, 2019, Mountain View, CA., USA
Course Startup School 2019
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Startup School Q&A Week 1
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About speakers

Kevin Hale
Partner at Y Combinator
Eric Migicovsky
Partner at Y Combinator

Kevin Hale was the cofounder of Wufoo, which was funded by Y Combinator in 2006 and acquired by SurveyMonkey in 2011. He was responsible for Wufoo’s much-admired design and speaks widely about UX. Before Wufoo he wrote about design for Particletree and was editor in chief of the web development magazine Treehouse. He has a BA from Stetson University in Digital Arts and English.

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Eric Migicovsky founded Pebble Technology (YC W11), which was acquired by Fitbit in 2016. While studying engineering at the University of Waterloo in 2008, Eric began building smartwatches with a group of friends. In April 2012, Eric and his team launched Pebble on Kickstarter, where it became the most successful crowdfunded project in Kickstarter’s history. Pebble sold over 2,000,000 watches.

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About the talk

Topic: Business

YC Partners Kevin Hale, Adora Cheung and Eric Migicovsky answer questions from the audience after our first week's lectures.

Hale

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Okay any questions? Have you experienced any difference between doing a versus an online survey question was have experienced any different different differences between running surveys in person or online. Honestly, you'll probably figure out what the best solution is for yourself online. Honestly gets a lot of a lot of it right? I conduct a lot of interviews over resume. I think it's Again, it depends on the context of the problem. Sometimes I really find a

powerful to stand behind a user and ask them to use their existing tools that can only really be done kind of well, if you're in person I have some soups that I have seen some people to that pretty effective way of resume as well. There's something that like you might does a ux research name Jared spool. I need to talk about some research recess like he noticed that in product teams products tend to get worse over time. If you find out that the product and design teams are not interacting directly with their users a minimum every six weeks some amount of time some set of hours.

And so it's one of those things where it's like there's just so much we gain from like stalking and having a small conversation where it's like you just missed a ton of stopped because it's like, I don't know how many servers you fell out, but the people who do 10 to fill surveys, they still a very weird bucket. I got no, you definitely need this open-ended conversation with a user rather than like a survey. Yes, lutely. Do you always want to supplement? Yeah, definitely. Yes, you have any examples of when your

user is different from your Pia? So for example, my start-up involves potentially selling two countries, so I will be trying to get entire countries to sign arguments to buy from me, but they will be the users of the products are going to be the people in the country. So who am I what happens if the users of your product are different from the fires and in the context of the actor who's asking whether a country's country's made me the people using it but the buyer may be

an individual. Yeah. This is a tough problem this usually cost for more user interviews ISO. The best. The best answer here is just to have conversations with different people in the buying change. Remember that a great user interviews not actually a sales pitch. Actually learning more about the context in which that person encounter the problem. So in your case, I might consider having several different layers of interviews with potential buyers potential users of the product potential influencers often times in an Enterprise sale. There are some people in the

buying chain that aren't even involved in using the product whatsoever that they have a say in make the budget or the time frame in which spell purchased for use new Solutions and so it helps to actually have conversations with them as well. So you can get contacts around maybe past attempts that they've tried to solve the problem of millions of dollars that they've already spent that went down to the drain and you can and you can learn like how they may be helpful or how they may hinder your sales process the future. Has purchased quick as that I would say for the economic buyer

in the company or whatever government or whatever it is. I'm talking to them and try to understand how they're going to make the decision and what they actually value is probably most important. Don't think I would add to that is like when you're talking to user. There's usually like in a complex B2B and a price reduction. You have someone that the acting as a champion someone who's like super excited by using the product using the user or there's someone here like I don't want to do this anymore if you you get up, never by my company and so you need to use them as you're like

Virgil like you're going to basically saying help me map out who was all involved who needs to be in the room and what are their sort of motivations? And so you basically looking to get Intel for all that process and then the whole question is like you need to have all the arguments with things that they sort of care about what are the facts I like to use at this stage and it helps if you're still in University, but you can actually kind of talk to big companies as if you were say the reporter for school newspaper or if you were working on a school project you can use this as like a hack that

actually get a pretty high-level contact with someone who might become a champion simply by kind of saying I'm just really excited. How about budget management software? I would love to learn more about that. I know that you you work on this a lot. I haven't you can actually like and interacting and and attack people at a pretty high level before you even announce that you're working on a solution for that. How much money do you control for your budget? So for some of us we've already watch were already talking to a bunch of Pop as

user is a week. But as we scale that might help beyond what any one person can talk. How do you isolate down the subset of users that you want to? The question is get the scale how to use like segment just a user's what's the reason for segmenting the users, you know housewives in Nova Scotia. They might have different feedback then someone in New York. So if you decide all right, who do you you just get a little bit every one hour or so if you'd like a really broad audience that you're trying to figure out where do they use cases?

How do you best handle that segmentation? So that way you get Deuce will feedback to know like specific direction of the product tools that I've used in the past not recommended to other people took Google consumer survey in SurveyMonkey audience. So both of those you can ask really simple question and choose the demographic Survey Monkey. What's a bidet actually a proper survey methodology that actually will balance out based on my u.s. Population. So for example, most people fill out surveys that's safe for money or for nonprofit mostly skewed towards

women and attend to be older and so like if you were to ask Google consumer surveys a lot of that stuff will tend to be skewed that way and for that you can actually specifically handle it and they'll actually use statistics which would have balance it out that someone is like directly asking I tend to not for broad product. Do you like a general surveys do they sell motor oil to my direct users to figure out like okay, who's this? We just already a fan of my product like who I accidentally acquired

who's like a superfan. I'm trying to figure out how do I get more of you? And then I'm doing everything I can get them to talk to me. So I'd rather like I will spend like 50 bucks on a gift card to get that use it to have a conversation with me. So I understand who he is and see if there's ways that I can multiply him and one of the things to remember is like never remember that you guys are the founder of a company you can actually Reach Out directly personally any one of your users and asked if you could just jump on the phone and chat with them. This is like something that is kind of

crazy because you're no big count like Microsoft I can do this for your Facebook talking to this. This is a competitive Advantage but you as a small early stage company have you as the product Creator the founder actually have a direct connection with any user in your user base some people productize this and do like tons How does just choose to have maybe 10 conversations print conversations with individual users every week to start tabulating for each customer figure out the characteristics of each one

like female where they live income level so and so forth and if you have all that out there that you can qualify all these people and then after that bucket all the customers until I cure my best customers here are the ones that paid me a hundred bucks or more and then try to find patterns and then go segments that way and talk to those people and like Kevin said, how do I get more people who naturally pay me more? What are the patterns? What do they do everyday? And offering gift card, whatever to do either interview sessions, like if you have enough data and you have enough of those type of

people, I would really aim to do a session once a week with a handful of its I find that the most informative thing in the best thing you can do for your business and bored looking in person session. Do you have an ETA of your problem is built? So let's say you have an MVP Bill you're starting to do this music interview. You're listening and not talking. When do you do the sales pitch the playoff the doors point I once you begin to understand within your user base who are the best users who are the people that that are

most disappointed if they couldn't use your product anymore who the ones that get the most benefit you can actually go sideways and you can try to dig deep and find more people that reflect the same kind of demographic some of the chips or tricks that we use like where do those people live on the internet? Which subreddits do they use which Facebook pages do they follow which on which kind of other services do they already used? And then you can like use the fingerprint of the user's you already know to find more and find out where they live online. To my

strategy would be if I was in that case and I had a wonderful user interview with them and it turned it's looking like oh God what I've built is perfect for this person. So instead of being like I feel like it's the wrong moment to be like, here's my thing. I'd rather be like I go home, maybe wait a day or two and be like, oh my God, thank you so much for the conversation that we had and based on what you talked about. I built the first version of this. I would love for you to check it out and let me know what you think. It's totally based on your feedback. And it's

more like is it going to be honored that ego stroked and them related to use it to me? I feel like I give you maximum benefit vs. It feels like did you even care about me at all? This is really a suit sales pitch didn't exactly and that's what you don't want to have after like being such a conscience has like empathetic listener and no one's that quick a program that they program it while they were talking. Yes. Yeah. So I am a few days ago. I saw you

and why you should delete the data as opposed to know if you want to limit tomorrow people there on the platform because a few people to talk to other treatment. I am a I kind of poop. Beta versions or labeling your product has beta to artificially constrain growth on your product. And so the main idea for me is that it creates I can afford it basically is a sign that says my products not ready for you. Don't use me cuz it's not ready for production expect Boxes Etc and the founders or engineer's like to put bait on there cuz it's it's like hey, you know what?

I know. It's not that good. I built it myself. I know how many bugs there are and I'm so scared of people being disappointed that I put this bait on is just going to remove all liability. And to me I feel like there's no product I've ever seen in production that doesn't have bugs and almost always what good Founders do is they listen to the people the responses back there as quick as possible even in your beta you will probably do the same. So to me I see no reason why you need to do that is to put that paid on so I don't like Anything to artificially contains growth

because like all that stuff you're going to do for the beta to be a good founder listening fixing etcetera going to do that. Even in production. The last number one the second thing about beta is that You can spend your whole company's life trying to get as many users as possible. And so if you're thinking like I built something so good. That if I don't put betta on they're just going to I'm just going to be over one with the man. I mean tell you that the hypothesis probably wrong. At all

and so again if something does go wrong are some issues that you're actually scared. If I don't have that feature reveal if something does go wrong just like a thank you so much. I've only been working on it all week. I've only been working on her month. I'm going to fix it really quickly and then get back to you. Please. Let me know if you find anything else and then you're more likely to get a more positive response and people actually using it the way that you're hoping you might find people as a result. I like real world honest test about do people want this thing and then is my thing

reading Founders need to get over is okay. I've built something crap people going to come if it's like not good enough. They're never going to come back. Like hopefully you're building a business that will but millions of people can use anyway, and so just the four or five people that come back or sorry, don't have a good experience get that feedback in there just after 8 for it's something better. You don't have to worry about them not coming back and I think that's actually Main reasons why most people don't watch early or they put beta tags on

everything. How do I stop I mean like a honey. I wouldn't wait for a hundred to me. They're going to happen in concert with one. Another question is like okay, how many interviews do I have to do before I start building Etc. And so if you don't have anything don't you don't even really know like what the solution needs to be. You're just trying to figure out what is the problem that out there you basically do weiner user interviews until you have an inside be like, I think I can build something that will solve the problem and then immediately start

building but for the most part you want to do them in parallel and just jump in Kevin offered a framework to think about is the problem that I'm facing or is a solution to the problem big enough to be a company. You can actually destroy That from those early user interviews more effectively than after you have a product because you're not biased by thinking like I really like this great idea already. You can actually be in that kind of pure mode where it's like, is this a real problem? Is this really a burning problem that you are facing? When do you charge?

When do you charge I love it or we in Austin as early as possible. And so like if you can get away with taking a pre-order wonderful like we often give advice to companies you're considering making a complex like B2B Enterprise at 4. Like go try to sell that first before you go commit 6th at 12 months making it it's asking people to put their money where their methods remember how I said before that oftentimes users don't really know what they want. They won't be able to describe the future product, but they will be able to know it when they see

it and at that point you can extract data from them by saying will this person has problems so acutely that they want to solve it that they're willing to pay some random start up as not even like it doesn't even have a product there their they're willing to pay the Mets like a a very strong signal that you're onto something lyrics model for talking to users is very similar to what the best sales people actually do when they're trying to sell their product. They're truly trying to understand. Diseases are potential customers problem and then they're merely trying to craft is like, oh, yeah,

we've got that we're able saw that devil to reposition their product back to them and to this is why you're able to actually even complex enterprise software if you truly understand the user or talk to them you like. Oh absolutely we can totally build that we can have that this time frame and I think we can do it at this cost. Would that be something of value to you? Would you like to sign a contract and I have is committed we can start with a patriot whatever like the whole thing is like through with the idea. You can sell it to the right customer if they believe that you're capable and

do you truly are going to build something of value to them. And so I did something we're like for my first product even before Pebble we set up a landing page with Shopify, but we set up a sales card where people can actually go to the checkout process to buy the product. We didn't feel comfortable about charging people's credit cards, but we made the the checkout process look exactly like they would have to pay So we figured we would get a better signal from those users instead of just like an email sign up for Mike. Are you interested? They actually went through the flow thinking

that they were going to have to pay something and at the end we sat like a we're actually accepting payment in a couple weeks, but at that point they were already so invested in the week. We think that it was a more effective way of kind of gauging interest. around the end Target And that's how far you figure out dancing is like the open-source model where we you release a product out for people start using for free as a way of like building up an audience that you eventually will sell to it. Like is that

pretty much all that model works. And so I think most of the successful open source, like bass companies looks like for like it get lab. Yes, that's pretty much how it works there thinking of building up an audience for us like that advice for us came directly from Jason Frida 37signals. So I can't talk about this story at South by Southwest doing big things with small teams and they had been blogging for years on their block 37 single people before they finally watch Basecamp and they realize like that was super valuable to them because people didn't start from zero when evaluating

their prey They feel like they already had a relationship with these people and they're all the exact kind of people the audience that they knew that they were building for. The segments did the founding of which kind of segment the story around how segment on got started actually created an open source library that analytics. Jay asked that you going to bed in your website and it would kind of duplicate all your analytics to orwood send analytics from your site to all of the different existing kind of aggregators and was open source project became like it just

went crazy on Hacker News and they end up using that as a way to then sell the rest of their offering from there. I think it was like a crazy small number of lines in the first version and then the see you at the time was like not a fucking chance. Nobody wants you stupid little code. Why are we announcing this and every chemical company and then it's like just went by I just went nuts. You don't have to do just couldn't get enough of that people actually make how do I get access to this code Etc. And then that became the company

business model whatsoever at the beginning again. Got to figure out like, okay, how do I charge? How do I turn this into something about you? Yes, I'm talking about. Find the building. Is it down. I love I love talking about this problem that comes up all the time. So especially for Hardware companies, but I would have tracked the problem to the question to like broader. Like if your MVP actually takes a lot of work to do if there's a lot of a building that needs to happen before you can offer kind of bad first modicum of value to users. How do you do that to

do a paper prototype excetera? I love this because I think that they're great ways that you can hack around this problem. It's very easy to say like I'm building, you know, the super complex piece of software or Hardware. I need to spend at least two years before I can talk to customers. I'm more before I could find out whether they're interested in buying with that is not true. You can start talking to customers on day one. And here's how talk about the existing ways that they're solving this problem figure out what are the products they currently used to solve it and figure out

what the pain point but the problems are from there the way that you validate that they're interested in buying something is packed together off-the-shelf existing technology that kind of approximates the problem. Obviously it's not going to be as amazing as you are beautifully designed perfect thing that you're working on but you'll get an approximation of it show that approximation show that hack to the person who just described that they have a problem and try to sell it. Dress up other people's technology is your own like put it together put your own 3D printed box on it,

you know duct tape it together put your name on it and try to sell it because what I've learned is that if people aren't even interested in buying or using the hack together solution, then the thing that you're going to work on for two years may not actually be like that much of a solution to the problem that makes it exciting like really if you're working on a problem. That's so burning that such an acute problem that users should be willing to work with like a kind of crappy hack together solution before you finish your real one, you can do so much with a landing page just understand

interest whether your message the idea resonates dreams like in touch with you I think the other thing is like Dropbox actually started that way. It's a Dropbox was launched as an After Effects movie that approximated what the experience was going to be like to share Dropbox and then everyone would know I want to know when it's offer is available and it's like almost no lines of code actually been and that was basically a product demo that launched that company. rare

Instagram Call Ed steinbruegge. Google a question is product out there like the digital space on Instagram. Facebook everywhere is getting much more expensive than it's true. I see a ton of like new products that are launching on Instagram app keeps thinking like how much money did they pay to get one out in front of me? It's it's crazy. What can you do at an early stage without that much money kind of going back to the theme of this this talk? You can talk to users I'm talking to you is

actually pretty cheap because people on an individual basis are probably willing to pick up the phone and talk to someone like like I said before I sometimes like they've never talked to a tech CEO. They never talked to someone who could actually build a solution to their problem. So you position yourself as someone who may actually be able to help them. They may talk to you just for free because they they they see an opportunity like just as a side note like Should I talk to a Founder who's working on a product that may potentially help me. I know that they're potentially willing to build

like the exact thing that I want if I just tell them that you may find people that are willing to kind of open open up the kimono and and share that for free in kind of that's that's kind of a way to get a couple users to talk to if you want to get more in aggregate the most scalable ways that we've seen work for our Founders are really like putting yourself in the in the demographic of interested users and figuring out where they live in a world where that means like in in the physical world. Like we have companies that hanged or text on on houses

because that's like an effective way of getting people's attention and kind of the digital equivalent of that is infiltrating communities where people who share who have his problem are sharing their thoughts like an X is a Facebook group about a particular medical condition or like a particular travel destination and position yourself as an expert in the space and an organic we enter in and be part of that community. Brennan questions. We got 50 minutes. Another. Thank you so much for coming to the first lecture. We're going to stick around for a little

bit and then I have to clear out of this room. But enjoy and we will see some of you on Saturday in New York and then back here again on Wednesday by guys.

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