#strategy
Many startup leaders shy away from the most painful problems. Whether it’s too hard to build, too hard to sell, or requires massive scale to achieve viable economics, there are many reasons to put opportunities in the too-hard basket. But tackling difficult problems is how we build differentiation in startups.
Startups are ideas in action. However, not all ideas are created equal. Let’s explore how startup leaders can use the concepts of feasibility, desirability, and viability to quickly and reliably validate startup, product, and feature ideas.
The best strategies and ways of working for early-stage companies can lead to chaos and quality problems for mature companies. Similarly, early-stage companies that adopt mature ways of working can move too slowly and burn through runway, when they should be finding product-market fit.
As you build a startup, selecting the right problems to solve and coming up with effective solutions is crucial. The principles of divergence and convergence can help leaders to understand and improve the problem-solving process.
The best startups are committed to outcomes. In an idea meritocracy, all people raise ideas, regardless of their position. Ideas are rigorously evaluated, quantified, and debated.
First-mover advantage argues that businesses first to enter a market have an advantage over latecomers. This common-sense idea discourages prospective founders, giving them the impression that they are too late to tackle a problem they’ve identified because someone else got there first. While first-mover advantage exists and has helped some projects establish a lead, there are many counter-examples where very late market entrants have won. In fact, the benefit of being late into a market often outweighs the costs.
Differentiation is required to build a great startup. This means you need to do things differently. But you can’t reinvent everything as you go: founders need to recognise where it makes sense to be contrarian, and where it makes sense to adopt common practices. This week, we explore the value of contrarian approaches in startup building, and the way the introduction of AI copilots impact this principle
Teams can tackle increasingly ambitious initiatives if they learn to challenge risky assumptions with proofs-of-concept, research, and other forms of experimentation.
For something that startups pay little attention to, pricing greatly impacts business outcomes like growth, revenue, profitability, and viability. But, some second-order consequences are just as important. This week, we explore how great pricing models can make it easy to prioritise initiatives within your startup.
Startup leaders want to integrate AI into their products. Prospective founders want to build businesses on top of AI. Investors wish to create alpha. Today, we explore how startups can capture value when deploying AI.
This week, we explore the difference between vertical and horizontal SaaS products and how verticalisation can be the best way to win in the increasingly competitive software-as-a-service market.
When you build a startup, it can feel like you’re constantly solving new operational problems within your teams. This week, we explore how by solving each problem in the right place in your business, you can build a simpler and more operationally effective business.
Partnerships can drive growth and augment your product at all startup stages, but getting started is difficult. This week, we explore how partnerships typically work for B2B SaaS startups and how to start utilising them.
This week we explore a versatile research exercise that can help you to pivot or improve your product based on the needs of your users.
Most startups are idea-rich and resource-poor. Founders and product managers are constantly bombarded with feature requests, so a lack of ideas is rarely the biggest problem. At the same time, startups typically try to achieve something ambitious with limited resources. Startup success is thus heavily dependent on what you say yes and no to and how you prioritise these initiatives against each other. I encourage teams to focus on complex problems faced by many rather than those faced by few. This is the best way to differentiate your product and find product-market fit.
Startup success is all about momentum. This is because startups do not have a great starting position to fall back on — they typically start with no customers, a small team, and no viable product. This means that you’re catching up for as long as you’re a startup. You’re catching up to the incumbents you’re trying to disrupt, to the competition which got a head start, to unrelated businesses with whom you’re competing for investment capital.
For many enterprise SaaS products, a layer of professional services is essential because enterprise customers tend to have diverse needs from each other. Professional services enable deeper customisation on a per-customer basis while keeping the core product focused on the target market rather than the needs of specific customers. Another benefit of providing in-house professional services is that they can provide a significant revenue stream during the early days of finding product-market fit. Many bootstrapped companies use this revenue to keep the lights on as they build recurring revenue momentum.
Most companies stumble across a market with a problem and spend most of their early-stage investment on finding the solution. So, while you can be strategic about choosing the right market and problem (mostly by pivoting to different problems that your target market is facing, or solving the same problem for a different target market), most companies leave this up to luck. What should never be left to luck is the discovery of a solution for your market. This is where great product management principles and operations can make or break a startup, and much of the time this means prioritising the right solutions and finding the best way to tackle them.
Startup leaders are constantly facing decisions of whether they should build something themselves, or buy an out-of-the-box third-party solution. I believe startups should be biased against building anything inessential that doesn’t pose a legitimate opportunity to create a competitive advantage. In other words: only do what you’re positioned to do better than anyone else.
Products with product-market fit are products that have found an adequately sized market that they can be sold into. It’s more of a spectrum than a binary state — some products are more suitable for their market than others.
The best product teams I’ve worked with embrace the iterative nature of software development. Instead of committing to roadmap items, they commit to high-level, long-term goals. These goals are the focus of one or more teams for at least a year, and teams work towards these goals by tackling small chunks of work and constantly re-prioritising and re-thinking their approach.
In SaaS, your customers repurchase your product every month, quarter, or year. Your product should improve at this same pace. Renewals are so automated they feel like a passive process. But this is a false sense of security. Every time a customer pays, they should receive compelling value. This week, we explore why and how startups should operationalise their investment in software development.
While this is a word that often comes with negative connotations, I believe that great products, particularly in the B2B world, are usually very opinionated. They come with a strong view of how they should be used, and how the problem they are solving should be solved. These products differentiate themselves from the herd and disrupt incumbents by doing things differently. Many B2B SaaS products are simply automated workflows built from the opinionated views that you should solve that problem in this specific way.
I am an advocate for simple and collaborative methods for defining strategy for a team, department or company. Many strategy frameworks are too complex and while they may seem democratic (by embracing voting, for example), they usually lead to the middling harmony of sticking to the status quo. Instead, your collaborative process should encourage rigorous debate to overcome the mediocrity of concensus.
Scope cutters can get a bad rap. We’ve all experienced situations where a team, under the pressure of a looming deadline, is forced to remove functionality from their upcoming delivery and the result is an unworkable feature that does not meet user needs. So, it’s understandable that when the scope of a feature is cut during the development cycle, this is often met with cynicism and disappointment.