Crossing the predictability chasm 🧗♀️
A fundamental force that governs healthy scale, a model for strategically addressing marketing challenges, and crafting rigorous and impassioned pitches for potential first hires.
Welcome to the forty-second edition of The Baton. A fortnightly newsletter that brings you three, hand-curated pieces of advice drawn from the thoughtful founder-to-founder exchanges and interviews taking place on Relay and the interwebz. So, stay tuned!
In this edition, you’ll find instructive and inspiring pickings from the brains of WP Engine’s Jason Cohen, Outfunnel’s Andrus Purde, and Prelay’s Gabriella DeFlorio.
Recently on Relay:
Heuristics and Hunches — Interviewing to See Beyond One’s Own Itch, Saying No to Overwhelming Demand, and Other Pre-MVP Deliberations with Teemyco’s Co-founder, Charlotte Ekelund
#1: Crossing the predictability chasm — WP Engine’s co-founder, Jason Cohen, tears through the pervasive startup belief that “future is inherently unpredictable,” and illustrates how that turns into a self-fulfilling prophecy, impeding the at-scale criticality of operating predictably. (Source: a smart bear)
When you’re small there’s no need to predict when the feature will ship. Marketing isn’t scheduling a launch and recruiting isn’t timing the start-dates of the next 50 hires in customer service and sales. This means you can — and should! — optimize myopically for speed-to-market.
Small companies brag about their speed as an advantage, but it’s easy to see why the larger company actually has a massive advantage. Sure, when WP Engine launches a new product, the marketing department needs predictability for the launch date, but that’s because it’s a highly-skilled, well-funded group, which explodes with press, events, campaigns, social media, and newsletters, grabbing more attention in a single week than a smaller company might garner in a year…
The tradeoff, however, is predictability. We didn’t line up that press and have those sales materials and ensure code-quality high enough to scale on day one, without predictability. Predictability means going slower.
Predictability requires more estimation (takes time), coordination (takes time), planning (takes time), documentation (takes time), and adjusting the plan when it inevitably unfolds differently from the prediction (takes time).
Predictability is also required for healthy team-growth. Consider the timeline of adding a technical support team member. First, Recruiting is casting about for potential candidates. Then scheduling and performing interviews. Then waiting for them to quit their job and take a week off. Then new-employee-orientation. Then classroom training. Then paired up with senior folks on the floor as they ramp up their skills and comfort. Then finally, after (say) four months, they’re up to speed.
Since that takes four months, we have to be able to predict the demand for technical support at least four months in advance, because we have to be hiring for that future demand right now.
If we under-estimate, our support folks get overwhelmed with too much work, their quality of life suffers, and service to each customer suffers; if we over-estimate, we have too many people which is a cost penalty. Of course, the latter is a better failure mode than the former, but both are sub-optimal, and the solution is predictability.
‘The future is inherently unpredictable,’ insists the small company, spurred on by Lean and Agile mindsets. Indeed, blue-sky invention and execution are hard to predict. But this is also a self-fulfilling prophecy; to insist the future is unpredictable is to ignore the work that could make it more predictable, which of course makes it in fact unpredictable to that person.
Small companies don’t have the data, customers, institutional knowledge, expertise, and often the personal experience and skillset to predict the future, so they are usually correct in saying it’s impossible. But it’s not impossible in principle, it’s impossible for them.
At scale, it becomes required. Not because Wall Street demands it, or investors demand it, or any other throw-away derogatory excuse made by unpredictable organizations, but because it’s critical for healthy scaling.
#2: A framework for finding the right growth channels, messaging that sticks, and first marketers — Outfunnel’s co-founder and CEO, Andrus Purde, on seeing through the twin lenses of category awareness and category urgency. (Source: Relay)
For all the marketing choices you have to make, you need some shortcuts. You need something to hold on to, in order to make your first, broad decisions.
And category awareness and category urgency are your best kind of shortcuts. If you operate in the CRM or the email marketing space, there’s pretty high awareness. People are looking for such tools on a daily, weekly, or monthly basis. Your job, then, is to be findable.
On the other hand if you’re creating something which people haven’t used/heard of before, say, a decentralized decision-making platform, then your category awareness is likely very low. Being ‘findable’ doesn’t help here as nobody is searching for what you’re building.
Then there’s also category urgency. We know what a gym is all year but most of us flock to gyms during the first two weeks of January. If people are aware of your product category but not searching, that’s very similar to low category urgency from a marketer’s perspective.
These are the two main marketing models.
I thought these were just a way to shortcut which marketing channels to run with, but I’ve realized (after reading Dave Kellogg’s blog quite a bit) how they’re also a shortcut for arriving at messaging that resonates with users.
If you are in a high category awareness situation, then your messaging is about how you are different, how you are better, and so forth. Addressing these specific how’s is what matters.
In a low category awareness business, you have to get people to understand new concepts, and sometimes, to nudge them to adopt new behaviors. Then it doesn’t make sense to talk about how you’re different from others, you have to make a case for why your thing exists in the first place.
Acknowledging this distinction means that your marketing is almost served to you on a plate. You know which channels to use. You know what kind of messaging to experiment with.
Interestingly, most companies and products are not one or the other. They are hybrids. Somewhere on a spectrum between high and low category awareness.
Hipchat/Slack make for great examples of hybrids. As messaging has been around since the mid 90s, it was just messaging for enterprise that was novel. People understood the former, the latter, the enterprise part, had a bit of a learning curve. Thus a need for messaging that communicates the how and the why.
…
And as of January 2022, we’ve transitioned from being an email marketing tool and are now a full fledged data connection platform, focused on sales and marketing use cases…
Email marketing for B2B would have definitely been a high category awareness product. Everybody knows email marketing. People know it too well. Everybody has too much email in their inbox.
Data connection, getting your sales and marketing data aligned, resides somewhere in the middle. Some people know that there are products like Zapier and Hubspot Operations Hub. Then there are some who likely have the idea that a connection tool must exist even if they cannot name one.
But surprisingly, hundreds of thousands, millions of SMBs are currently doing their exports and imports with CSV files, or just manually entering everything.
Which means for every new email being captured, there’s somebody typing that into a CRM. Which is crazy. But that’s still happening in 2022.
Thus some of the work we do is simply demand harvesting. That is becoming discoverable. If you’re searching for an alternative to PieSync, you’ll probably find us.
Although a lot of the growth is to be sought in demand creation. Which lies in getting a much broader base of people to abandon spreadsheets and manual work. Which might take a long while, but there’s incredible potential there.
#3: The meticulous prep of pitching potential co-founders and early hires — Prelay’s co-founder and CEO, Gabriella DeFlorio, emphasizes the necessary work of building recruiting momentum from the start. (Source: The Engineering Leadership Community)
I had a goal in the very beginning, say, just when I started things off last June or so, that I wanted to bring in a co-founder, have my core idea, have my core ideal solution/MVP by the end of the summer.
I was able to do all those things. The co-founder was kind of inter-mixed with those. I would say it took me about a couple of months or so, but typically, I think, that’s on the faster end.
I really attribute that to being organised throughout. Really being persistent throughout. Being prepared. With those core data pieces that I had, so all of that data that I created from the user interviews, knowing exactly what was needed in the industry.
I prepared to make sure that they were aware that I was an expert in the space. That I was ready to be able to take on this challenge. And that they were able to hop into not as much of a stable situation by any means, but a little bit more stable than most other founders…
I recommend this to [everyone]. Making sure that you can dig through those early user interviews to pass that along. I tossed those into a Notion doc, had a full bank of information that I could just pass along to a co-founder, to be able to present to them.
Potential co-founders, even potential early employees as well. It really gave them an idea as to what they’d be signing up for upfront without even having a company built. I think that really drives momentum in the very early days.
Having this organisation of user research, the backing of industry [knowledge], and what you’ll be building towards. I don’t think enough people do it.
…
People can be bought into the idea. Think it’s a great idea and be able to go ahead and give you kudos for it. But in the end, it’s not really going to work, to actually get them to drop their jobs. Especially when they’re making plenty of money in that job and are comfortable….
It was about building presentations for these potential co-founders around: What does the go-to-market strategy look like? How can we get out first few customers in the coming months? How can we make sure that we’re scaling up this company from a team perspective as well? What will we need, potentially, would that be a couple of new engineers?
And it really came from all the preparation I had done beforehand. You had already prepared yourself at that point, then.
The persistence piece is also a big piece. I don’t think enough people are persistent when trying to close on candidates, especially co-founders. Sometimes you just need to push to make sure they can hop onboard.
Once you have that relationship with a potential co-founder…you just have to inevitably be able to push them through that just selling, honestly.
And that selling, again, goes back to what would you produce in an investor deck. What would you add as your GTM function? What would you add as your core pitch of the product? What would it be in the next 10 years? What could this co-founder be working in the next 10 years and have ownership over?
That’s really going to be the big piece that would win someone over, to be able to really drop their job and hop on. Seems risky. But actually comes across as way less risky if you have that information in front of them.
Until next time,