Hello, everybody. I'm Rob. I'm going to talk about some of the practicalities of starting
to talk to people when you are a very young startup, because it admittedly takes a ton
of time. And kind of back when customer development first started appearing, software was so expensive
to build, and it took so long that you were almost always correct to be talking to people
like constantly, because it was just so much cheaper than building these huge systems.
Now that's not necessarily the case in all situations, right? The cost of building software
and actually seeing if it works rather than talking to people, it's become a lot faster
to build the software. So now I think there are still times when customer development in
the conversation is absolutely crucial. And so what I want to kind of break down is where
I think those opportunities are, where it becomes a priceless and amazing tool and can
get it stuff that product development really can't. And also just the mundane practicalities
of how you actually go about setting these things up and doing them. So it's great for
kind of pulling out what to work on next. And one of my favorite benefits of customer
development is that it acts like a gate. People go, oh, I can't line up, how am I going to
talk to three customers? No one like this will ever talk to me. And it's like, okay,
how are you going to sell to them in the future? So doing customer development today, it kind
of proves to you whether or not your sales process is going to work in the future. That's
really powerful. And I've seen guys kind of, they're like, yes, I'm going to do this. It's
going to be awesome. And then two weeks into customer development, they're like, wow, I've
talked to no one. I don't want to do sales. This stuff makes me miserable. And that's
an awesome thing to find out early, right? Because a sales driven and a marketing driven
company are totally different and you have that choice. Like you get to build whatever
sort of company you want. Then whenever you move into a new industry, if you're scratching
your own itch, this is less relevant, although I still think it's worth the time. But if
you're moving into a completely new industry, there is no other way to get started. My first
company we moved from San Francisco to London, we left the valley after two years. And that
was because we were moving into the advertising industry. We really didn't know how it worked.
We were, you know, we were from a B2C background. We were trying to make video games. It turned
out the players had no interest in what we were building. But the brands really wanted
to license the technology under it to advertise through it. So we're like, okay, so we packed
up, we needed to go to New York or London. And that was because we needed to have a ton
of speculative coffees with our potential customers. Getting on a plane every time you
want to have a meeting is impossible. And then I just, you know, been really happy in London.
And you know, most importantly, it's to find out if people care at all. The decision to
use a startup's product in the early days is a bit irrational. Like it tends to break,
the service is a bit weird, it doesn't necessarily do what it says it's going to do. You know,
it's like, it's all very weird. And the emotional response that you get from someone who's like
so excited, they're like, yes, I love this, I want this. That's exactly the same signal
that you get both from helpful people who are going to talk to you before you have anything
to show. And also the first people who are going to end up buying and using and promoting
and evangelizing your product. And you know, you find out what that thing people want is.
And the way you do this is by exploring around emotional signals. I take pretty robust notes
when I'm talking to people. And this is a response to burning myself real badly the
first time I did extended customer development. I spent essentially three months doing nothing
else. My full time job was just like every day interviews, interviews, interviews, talking
to everyone I could. We went through like every music label, every movie studio, everyone
that mattered. Most of the creative agencies we could find in London. And then a couple
months later we realized that we needed to change what the company was doing. And I nearly
broke down and cried. I was like, I'm going to have to go out and do all of those interviews
again. This is unbelievable. And that happened because I had failed to write down what I
was being told the first time. When you write it down, you build up this really amazing
kind of archive of two things. Well, it does two things for you. One, it lets you convince
other people that what you've learned is true. I had a co-founder quit because he thought
I was being a flaky leader because I kept changing our strategic direction. That was
based completely. And I still believe they were the right choices. They were based on
straight up like really good customer learning. But I wasn't able to communicate that to anyone
else. You know, the company is not just you. You've got a team. You've got investors. You've
got other people. You need to be able to share what you're learning with them. And that comes
through what you've written down. Saying, like, no, trust me. Like, I know. Like, that's
not necessarily a legitimate. And this starts to become something you can pitch with and
you can show real progress and real learning with. So the main thing that I look to write
down is, like, if someone gets really happy or excited, that's awesome. You want to dig
in there. If you see someone and you're talking to them and they go, yes, that would be amazing.
And then you go, okay, next question. You move on to something different. You just wasted
the whole point of what you were there for. Similarly, if people are frustrated, then
these I use, if they're talking about problems, obstacles, and workarounds. And these are
just meant to be quick signals because anything complicated, you're not going to do. You're
already talking to them. The friction has got to be really low. And I just throw these
onto cards or, like, Sal Varani, who's another, he does a lot of Custav stuff at the moment.
He built kind of a front-end form just wrapped around a Google Doc so that as he's talking
to people, he can just, like, kind of maintain eye contact and keep typing. It's a big creep
the first time you see it, but he tells them what they're doing and they're okay with
it. And then you can review this artifact later. You can bring it together. You can
talk about it. You can manipulate it as a team. And you also get the way the customers
view your product in their own words, which is so powerful. I once spent, you know, months
pitching a product, and I was like, and it does this, and it does this, and it's solving
these problems. And then when I heard the customer describe it to the rest of his team,
he goes, yeah, it's going to stop us from having to use Excel. And they're all like,
oh, awesome. That was the entire pitch. And this job, it's so desirable. It's so tempting
to outsource it, to give it away. This happens with both customer development and sales.
These are not necessarily comfortable things to be doing. And I deeply, truly believe that
you can't outsource these in the early days. You can once you've found out what your business
model is and once, like, things are working pretty well and you've really carved out the
space. But it's the founder's job in the early days. And when you work through consultants
and external figures, or if you hire someone to be like your sales guy, and what tends
to happen is they go out and they learn stuff, but they can't actually bring you bad news.
They're unable to because they're worried they're going to get fired. And even if they
do and they take that risk, you're still not going to take them seriously. They're going
to go, oh, that guy doesn't know what he's talking about. He's new. So then, like, in
that case, if the customer learning can't feed directly into product strategy and business
strategy, you may as well not be spending the time.
And then the last one is kind of about sales specifically. When you hire in salespeople,
they tend to want to be compensated like salespeople, which is the more money and product they sell,
the more they get paid on a commission. And early-stage startup sales isn't about making
money. Early-stage startup sales is about figuring out how to scale in the future with
a sales-driven organization. Or if you're marketing-driven, it's about learning how
your marketing is going to look, digging into that customer. But it's really not about
the revenue. You might make some kind of revenue as a side effect of early-stage startup sales,
but it's really about learning. So you want to be building out this roadmap, this idea,
okay, our customers need this. They care about this. There's these seven people within the
organization we need to talk to. The best entry point is with the middle manager, but
then you've got to talk to their boss and you've got to talk to the tech team. And my
first company, Habit Industries, we lost a lot of sales because it took us a long time
to realize that the lawyers were a crucial part of our sales process. And our deals
kept getting like, they were getting executive sign-off. The brands were excited. Creative
was excited. And then right before signing, they would disappear and we would never hear
from them again. They're like, this is very weird. Everyone was so excited, right? Like
the creative was done. We were ready to launch the campaign. And it wasn't until I sold into
a buddy's company that he was like, you know why that deal didn't go through, right? I
said like, no, like why? And he's like, the lawyers, the lawyers killed it. And so we
went back and we looked at our previous deals that we'd lost. And that was basically true
across the board. Like, oh man, by then it was a little late, unfortunately. And the
early sales, if you try to hire in a salesperson in this role, you're giving them an impossible
challenge and you're just going to burn through, burn through money. The startup genome project
has basically proven this. The reason that startups fail is because they try to grow
too fast. You get addicted to revenue. You get addicted to traffic. You want to make
it big. We normally think of that in terms of technology. Like, don't start the big
AdSense campaign before you've got your attention in, right? Don't do the big PR push until
you can really make use of the users you're getting in. Because these things are either
expensive or they happen once and you don't get them again, like launch buzz. Hiring sales
people is another form of premature scaling until you're really ready for it. And getting
ready for it is the founder's job. Now, my background is technical. Learning, I won't
even say learning, so I'm still not very good at it. But getting comfortable with sales
is probably the worst two years of my life. If the alternative hadn't been to go out of
business and fire all my friends, I never would have put myself through it. And what
really made the difference for me is, like, it's a skill. It's so learnable. There's
a process. It's pretty predictable. It's not that complicated. A bunch of smart guys have
written a bunch of good books. You read through them. You basically know how it works. Makes
life a lot easier. I recommend Spin Selling by Neil Rackham. He's got an awesome name.
It covers basically the same ground as Four Steps to the Epiphany, but it's much shorter,
much easier to read. And it focuses on the actual, like, getting them to be excited and
understand their problems and making it happen.
The last thing about sales is, like, we tend to think that what matters is what happens
in the meeting, right? That it's the clever things you say and the clever tactics and
how you negotiate. And did you banter enough at the beginning of the meeting? And really,
none of that matters. What matters is kind of how well you know your industry, right?
How well you know your product and understand your customers and their problems. And as
you do this more and more, even if you suck at it at the beginning, you're going to really
start to become an expert in your field, at least, right? You're working on your startup.
You're deeply understanding it. You're in it every day. There's huge value there.
The people that you're talking to, who are going to partner with you, who are going to
buy from you, who are going to invest in your field, they don't necessarily have this deep
daily exposure that you do just by talking to them. Like, you're offering huge, huge
value. And that will start to come out in the sales process. Like, I mean, even thinking
of it as sales is probably overly intimidating yourself, right? This is someone who's in
your industry, and it's, like, very cool, and you've got stuff to tell each other. And
I think that's more the attitude I would recommend. You're trying to learn from them, and they're
going to be excited to learn from you, even if no money changes hands.
And you can totally screw it up. So many people, I mean, myself included, primarily myself,
basically me. Like, you go out and you feel real good. You're like, and I talked to somebody.
I did it. I did that uncomfortable thing. And then you walk away from the meeting and
nothing has changed. You haven't learned anything. You're not going to change what you're doing
with your company. You have no evidence to share with anyone. You just, like, feel good.
You met with someone wearing a suit. Like, they feel important, right? There was a lobby
and they offered you a coffee. But this basically happens. The number one killer is bad questions.
So, right, okay. You're not meant to ask your mom if your product is a good one. This is
true. But I think you're not meant to ask anyone if your product is a good one. To me,
the sign of a good question that you can actually learn from is it passes the mom test. And
that is that even if you asked your mom about it, she would not lie to you because she doesn't
realize that you are giving her the chance to hurt your feelings. And you do that not
by asking, hey, here's my product. Like, imagine this. Like, hey, I built this thing. I worked
so hard on it. I am about to lose my house. I really love it. I'm going to cry if you
say mean things about it. What do you think? Like, that's basically the structure that
most startup pitches and sales take. And it's impossible to give honest feedback in that
situation. And it's impossible to receive honest feedback if you're the founder. Even
if you're, like, stone cold, you, like, come in there, you're, like, eating a raw onion,
you're, like, drinking a glass of boiling water, you're, like, I can take it. Like, give me
your honest feedback. Like, it's still, like, a very weird experience. You need a kind of
benevolent sociopath to give you honest feedback. And that result, they want you to be successful,
but they don't care about seeing you cry. So, what I want is, I want questions that
pass the mom test. So, you go, hey, mom, I'm making a cooking app on the iPad. You put
it beside you. It's got whatever. Jamie Oliver in it. It's going to cost 20 quid. What do
you think? She's like, oh, that's amazing. I spend 45 quid on pounds, British sterling,
on cookbooks all the time. Of course I would do that. You know, I love it. And then you
go off and you build the thing and no one buys it and you're sad. If you go, hey, mom,
how's the new iPad treating you? And she goes, oh, I love it. It's amazing. And you go, when's
the last time you bought an app? And she goes, oh, I don't trust that. I'm not putting my
credit card in on the internet. Right? Like, you've just learned exactly what you needed.
You never gave your mom a chance to lie to you. That's the way you need to approach every
single customer conversation. You ask about them, what they did, when the last time they
did it is. You go, hey, would you buy something like this? You just got lied to. You just
set yourself up to be misled and get a false positive. If you go, hey, when's the last
time you did that? You bring people back to a concrete example in the past. They go, yeah,
I do this all the time. You're like, when's the last time? They go, oh, actually, okay,
well, that doesn't really happen. But usually I do this. And you're like, you can kind of
bring people back to something concrete. So customer development is super weird. The weirdest
part about it is that you don't really know why you're there. And the customer doesn't
really know why you're there. You're like, hey, I want to talk to you. But they're like,
are you selling something? And you go, not yet, kind of. But I want to eventually hold
that thought. I'll be back in six months, maybe, if we haven't changed what we're doing.
The whole thing is a bit weird. So what I like to do is reframe the entire relationship
so that I'm not looking for you as a customer. I don't want to sell you anything. I don't
want your money. Like money is a side effect. It's not the goal. What I want to do is find
amazing industry advisors. So the reason I'm talking to you is because I think that you,
as someone who's an awesome customer inside the group of people who I care about, and
I want to improve their lives, I want you to be excited about my vision and the thing
I'm trying to do, and I want to have an awesome conversation with you, and then I want to
offer you a stake in my company. And this completely flips the conversation on its head, right?
Like we're not talking about the industry, not about whether you want to buy my stuff.
You're now trying to impress me because you want to be involved in my company. There's
just something in this mindset shift. It gets you to exactly the right place for customer
development. So look for advisors, not customers. And also, the people who become your advisors
will often become your first customers. They'll often be your most active and involved early
evangelists, customer evangelists. That's great. Cocktail customer development is another
one. There's this anti-pattern in customer development. I call the meeting anti-pattern.
I don't know. It's not a very interesting name. But basically, you... I'll just jump
over here. So you meet someone amazing, right? And you're like shaking. You're like, this
guy would be my dream customer. And you get through the crowd, and you see him, and you
like, he's there, he's alone. You exchange business cards, and you get to shake his
hand, and you're like, yes, we should meet sometime. And he's like, okay. I have no idea
who you are. And then you never see him again. If you knew what the questions were that you
were out to get, you kind of meet someone. He's like, here, I do this. Here's my card.
You guys deal with a ton of deal flow. That must be hard. How do you manage all of that?
You're trying to build tools to help people manage deal flow. It's like, I saw your portfolio.
It's incredible. How do you keep up? And they go, oh, actually, it's not that bad. We put
a bunch of post-its on the wall. We have interns filter most of it, and then it's only about
four deals per partner. It's like, it's pretty easy. And you go, huh, that just invalidated
my entire business. And we didn't even need to have a meeting and get on the subway for
it. And when you're in the meeting, you should always know what the three things you're trying
to find out are. Like, three things feels about right for any conversation. But once
you have them in your head, you'll start finding opportunities to get them out of the way
everywhere. Any time you have a drink in your hand and you go to industry meetups, and suddenly,
boom, you had like three hours of rapid-fire customer development. It's not about being
a formal thing. It's about you asking the right questions to the right people in the
right way, and you can do that anywhere. What most of us are doing is we're growing movements,
and that's very people-driven. You get 10 people in a room, and they're excited about
something. That's a chance to start deploying products and technology into it. When you
start with the people, everything becomes easier. And it trivializes the task of getting
the right people in the room for you to ask them questions. So I'm such a believer in
hosting meetups. When you organize a meetup, even if it's an industry, you have zero credibility
in. Just the fact that you invited everyone, they're like, oh, that guy knows what he's
talking about. You become the instant connector. And then you can ask everyone questions. It's
like, it's the easiest in. Personally, emailing your first thousand signups is another one.
It seems absurd. Don't do it with a robot. Just write the stupid email. So many people
will be like, you're just like, hey, I'm the founder. Let me know if you have any questions.
I'm here to help. And they'll go, so many people will go, hey, this is interesting. What are
you doing? And you'll have sent the email to Vanessa Yahoo, and you'll get the email
back from Vanessa VP of MTV. And then the people who matter most and are most able and
willing to help tend to self-select themselves. So yeah, I think that's the gist of it. So
talking is a huge waste of time. If you do it wrong, you may as well not bother. But
it's an incredibly valuable tool when you do it right. Thanks a lot, guys.
