Source: New feed
The following is a guest post by William Griggs. William is the Founder of Startup Slingshot, the resource for battle-tested startup strategies. Access the audio interviews of today’s featured growth practitioners, the full 43 page guide, and tons of resources here (free for now).
“A startup is a company designed to grow fast.”
Growth is what founders and investors alike are constantly searching for. Growth enables startups to quickly create tremendous value in the market. Without growth you’re dead in the water. But accordingly to Paul Graham, there’s a silver lining: “…if you get growth, everything else tends to fall into place.”
“For a company to grow really big, it must
Unfortunately for most founders, viewing their startup from this altitude isn’t extremely actionable. In this post, we’ll uncover the methodologies and tactics you will need in order to validate your business and systematically reach and serve your target market.
How do you ensure you are making something lots of people want?
Making stuff is the easy part. The key, however, is making something a lot of people want. Market selection and product/market fit are critical here.
This is where a lot of startups end up spinning their wheels. As you build product early on, how do you determine if you’re on the right track or heading towards a dead end? While every business is unique in terms of exactly what it needs to do to achieve product/market fit, the process for quantifying it is consistent.
Assuming you can’t use sales as an indicator of product/market fit, below you will find several ways Brian Balfour, VP Growth at Hubspot suggests quantifying product/market fit for your startup. The further down you go on the list, the more customers are required to receive meaningful insight.
- Indicator Surveys — What do people say about your product?
- Created by Sean Ellis, Survey.io is the perfect tool for indicator surveys. To learn how to use Survey.io, read this.
- Leading Indicator Data On Engagement — How are people using your product?
- What are you seeing inside the product? How active are your customers?’
- Retention Cohort Curve — Does your retention curve flatten off?
- If people consistently use your product over a certain period of time, you’ve reached product/market fit for at least a subset of the market.
- Unsure how to get started with cohort analysis? Read this.
Don’t have enough data to do any of these steps? Focus on executing “trickle marketing campaigns.” Sean Ellis, CEO at Qualaroo was right to say that in order to understand what your target market thinks of your solution you have to expose it to them. The trick here is to not spend money and time on a big launch, instead focus on highly targeted marketing campaign that puts your product in the hands of the target market.
Before moving on to the second piece of Paul Graham’s growth equation, it’s important to emphasize that you have to get this right.Without product/market fit you’re wasting time even thinking about growth. As a founder, your startup is like a ticking time bomb says Andy Johns, Director of Growth at Wealthfront. You have a certain amount of time before everything will explode. To extend the time allotted, you need to show growth and the first step is establishing product/market fit.
How do you ensure you reach and serve all those people?
You’ve built something that solves a problem, for at least a part of the market, and now it’s time to get it into their hands.
Three Principles For Driving Quantifiable Growth
Learning how to reach and serve your target marketing isn’t rocket science but it isn’t obvious either. Those that drive quantifiable results do so by following these three principles:
- Triage: They work on the highest return on investment activities, suggests Ivan Kirigin, CEO of YesGraph.
- Test: They don’t assume they know what’s going to work. Instead, they focus on generating and testing hypotheses, Ivan adds. If you don’t take the time to get your analytics straight, so you can validate assumptions you’re flying blind.
- Set Goals: They have a target metric they focus on. Doing so will help you focus your efforts.
Now let’s dig into the specifics.
How To Ensure You Reach Your Target Market
When starting to think about how you are going to really invest in reaching your target market, it’s important to revisit your business model. To start, you will need to formulate your target customer acquisition cost (CAC). Doing so will help guide you in determining which channels to test. To calculate your target CAC, you must estimate the average lifetime value (LTV) of your customer (learn how to calculate LTV) and subtract your profit margin. Hitting this CAC will allow you to profitably acquire customers. While most bootstrapped companies target a CAC that is 30% of their LTV, many VC backed companies that are trying to own their market typically spend to 100% of their LTV.
With this in mind, the next step is selecting what customer acquisition channels to test first. Below, I’ve briefly summarized Brian Balfour’s blog post titled, “5 Steps To Choose Your Customer Acquisition Channel.”
In this matrix, you will have a list of potential marketing channels on the left and a set of channel attributes at the top. Keep your business model, competition, and target market in mind, and begin to fill out the matrix by rating each channel using the words “low,” “medium,” and “high.”
Review your current constraints (time, money, target audience, legal, etc.) and select the top one or two channels to test for viability. The viability of a channel is determined by its ability to drive predictable returns on the time/money invested. Once you find a channel or two that works, it’s time to double down and to continue to invest in optimizing the channel.
Not sure where to start with each of these channels? Check out these videos from 500 Startups’ WMD conference.
How To Ensure You Serve Your Target Market
In addition to reaching your target market, you must also focus on optimizing the process with which you use to serve them. In this case, serving them means getting them to your product’s “wow moment.” To get more of your target market to your product’s “wow moment,” Sean Ellis suggests that you focus on increasing desire and decreasing demand.
- Increasing Desire: To increase desire you are continually working to test and optimize your messaging and positioning. The thought is, “with enough desire, people will overcome a lot of friction” says Sean Ellis. To execute on this and track your progress, you will need a combination of qualitative and quantitative data. Sean emphasizes that it’s paramount to keep the ultimate product experience in mind, so that you don’t increase desire for a product promise that your product is not designed to deliver on.
- Decrease Friction: This step in the process is all about conversion rate optimization. It’s about seeking out and fixing all that’s preventing people from converting, whether that’s a macroconversion, like signing up for your product, or any of the microconversions that lead up to it. To dig in further on this topic, I suggest you read Qualaroo’s, “The Beginner’s Guide to Conversion Rate Optimization.”
In this post, we’ve covered the essential elements to designing a startup for fast growth. If you’re farther along or you just want to dive deeper into growth for early-stage startups, you can access the audio interviews of today’s featured growth practitioners, the full 43 page guide, and tons of resources here (free for now).
An Early-Stage Founder’s Quick & Dirty Guide To Growth
Homebrewing is a hobby that always has a shiny new piece of gear to buy with your beer money. Now that I make a little bit of money from the hobby (between writing, consulting, hocking t-shirts, and Amazon Associate Links like those below) I get to write-off what I spend. This forces me to actually track my spending more closely than I did when I was brewing purely for the love of the beer. It also means I sometimes get some ingredients or equipment for free that I wouldn’t have otherwise purchased.
Here’s a list of nine things that I don’t think have provided a good ROI (return on investment) – or wouldn’t had I purchased them. I’m certain a few of you will disagree with every one of the items on the list. If I’m missing some big advantage, an alternate use, or if they’ve improved, let me know! Also, feel free to post a comment if you’ve got anything that you’ve been disappointed with, save the rest of us a few (hundred) dollars!
1. Thermoworks Thermapen ($96.00): A fast/accurate digital thermometer certainly isn’t the worst thing to spend your money on, but an upgrade of a couple seconds or a few tenths of a degree doesn’t justify five times the price! My Thermapen lasted for only two years before a wire broke and it stopped working. Even before that the swivel started to become a bit sticky. I’ve had much better luck with Thermowork’s Super-Fast® Pocket Thermometer. Compare its specs (5-6 second readings, ±0.9˚F/±0.5˚C) to the Thermapen (3 second readings, ±0.7°F/±0.4°C), not bad for less than 20% of the price! Without moving parts the Pocket is also less prone to breaking, mine is going strong after nearly five years of double duty brewing and cooking (my circa 2008 Thermapen wasn’t waterproof like the new ones, so they may now better handle the rigors of sticky wort).
2. HopRocket ($124.99): When we started developing the hoppy beers for Modern Times, Jacob bought me a Blichmann HopRocket to better replicate the character they’d get getting with a hop-back at the brewery. Three years later we’ve independently come to the same conclusion: hop-backs generally aren’t worth the hassle! I never got much character out of the hops compared to whirlpool (hop-stand) and dry hopping. I stopped using mine after trying it without dry hops. At the brewery they’ve found they get a better character from moving the hop-back additions elsewhere. My chilling process is much easier now that I can simply recirculate hot wort through the plate chiller to sanitize, rather than filling and draining Star-San.
3. 5 lb CO2 tank ($65.00): If you have enough room, there is no reason not to get a bigger CO2 tank. CO2 prices aren’t linear like propane or gasoline, it is really the activity of filling that comprises most of the price. A 20 lb CO2 tank often costs only a only few dollars more to fill or swap than a 5 lb tank. It’s also nice to have extra CO2 because one of the biggest pains of owning a kegerator is getting to the gas supplier during their limited hours. I kept my original 5 lb aluminum tank for flushing carboys/growlers, and mobile dispensing.
4. Ultra Barrier Silver™ Antimicrobial and PVC Free Beer Tubing (~$3.00/ft): This high-end beer line doesn’t seem to be any more impermeable than standard tap lines. I had a keg of carbonated water on that I could taste the pine and citrus that were in the beer I ran through the line previously (despite cleaning and sanitizing with alkaline brewery wash and Star-San). Beer line cleaner removed the flavor, but if I have to use it between each batch I don’t see the advantage compared to standard tubing at less than 1/3 the price!
5. Brewery-Specific Cleaners ($12.99): In most cases, Oxiclean Free will do the same job for half the price of PBW. Nice to have something a bit stronger around for when you need it, but in most cases a long soak in hot water and Oxiclean gets rid of fermentation crud. Beer line cleaner is a stronger option for really tough jobs if you don’t mind the extra precautions necessary when working with caustic. I’ve been disappointed in the keg/growler tabs from Craft Meister, it takes them so long to dissolve even with agitation that the water cools off significantly by the time they are fully dissolved (their powdered cleaners seem fine if unremarkable – although I don’t like the packaging).
6. Overpriced homebrew store ingredients: There are plenty of ingredients at your local homebrewing store that are over-priced compared to a readily available alternative. If you want to dry out a strong/pale beer like a tripel or double IPA skip the clear candi sugar or dextrose and add some table sugar. Avoid the over-priced “brewing” spices sold and visit an ethnic market (Latin, Indian, or Asian especially) or a specialty spice shop. Prices will be lower, and more importantly quality/freshness will be better. Same goes for pricey fruit purees, they are easy to add, but painful to separate from the finished beer.
7. HopShot ($3.99): So many delicious IPAs are bittered with hop extract. On a commercial scale, compared to “actual” hops, extract is less expensive, more consistent, and increases yield. Virtually all of the beers brewed on Modern Times’ 30 bbl system receive a can or two of hop extract at the start of the boil. Russian River, Hill Farmstead, Stone, Tired Hands etc. all use hop extract for at least some of their beers. I’ve had good results with Northern Brewer’s HopShots a few times. However, I found that the packaging wasn’t consistent. Some syringes contained a fresh smelling golden serum (top). while others were murky brown and smelled oxidized (bottom). The “dark” syringes also tend to leave small “tar balls” in the hot break and stuck to the sides of the kettle. Someone needs to improve on hop extract for homebrewers!
8. Perlick 650SS Flow Control Faucet ($54.50): When I upgraded my kegerator earlier this year, I bought a couple flow-control taps to allow me to serve highly carbonated beers without excess foaming (I hoped). The problem is that the Perlicks clog very easily compared to standard Perlicks. The lever mechanism, even when fully open, creates such a small gap that any hop particulate or fruit pulp becomes lodged (requiring disassembly and cleaning). Nathan had similar complaints for the ones they use at Right Proper, but also mentioned they’d gotten them replaced with a newer model that doesn’t have the same issue. Although, even when they aren’t jammed the pour doesn’t seem to be any smoother than the standard Perlicks. 650SS are also not recommended for sour beers anyway…
9. Glass Carboy ($27.05): Glass has the unfortunate ability to shatter without a warning dent. The shards themselves can cause serious injury (to both beers and human flesh). I still have a couple glass carboys that I use as a last resort, but I’ll never buy more if/when they break. I’ve had good luck with 8 gallon wine buckets and now Speidel 30L fermentors for primary fermentation (it is nice to not worry about blow-off 98% of the time), and kegs and plastic carboys for long term storage.
Bonus! Oak barrels: This one might surprise many of you, but I think most homebrewers would be best served skipping oak barrels. They are expensive, unwieldy, and prone to leaking, oxidation, and mold. If you want oak character, add oak cubes. If you want spirit or wine character, blend your favorite commercial example into the fermented beer. Sure barrels are pretty and they can be a great excuse for a group project, but on average I haven’t found the beers I’ve aged in them to be significantly better than those aged in carboys or kegs. When the barrels and technique are on, they do have another level of character that can’t be matched, but those are few and far between.
If you want to make brewing more affordable, focus on items that allow you to buy malt and hops in bulk (grain mill, vacuum packer, etc.). Buy gear that will last , rather than items that will need to be replaced. They may be more expensive initially, but better to get something that will last 20 years, rather than saving 50% for something that will need to be replaced in five years.
Source: The Mad Fermentationist
One of the more fascinating talks I attended during National Homebrewers Conference 2014 in Grand Rapids wasn’t even about beer. Ken Schramm (author of the excellent Compleat Meadmaker, and founder of Schramm’s Mead) talked passionately about bees, amino acids, and agriculture during “Really Understanding Honey.” While he talked he passed around ten varietal honeys for us to taste with single-use straws. The range from a mild honey like blackberry to some of the weirder ones (e.g., leatherwood) was interesting. Others demonstrated how different a single varietal (like orange blossom) can be depending on what part of the world the bees collect nectar (milder California versus the more more acidic/juicy Florida).
The two that really stood out to me were meadowfoam (toasted marshmallows) and Mexican coffee blossom (hint of coffee-like roast). I knew I had to get my hands on one or both of these to add to a stout! Last month I finally got around to brewing with meadowfoam honey. The base beer was a relatively straight-forward oatmeal stout, with 10% home-toasted oats rather than a breadier base malt. If I really wanted to play-to s’mores, I could have added a bit of smoked malt, but I didn’t want the flavor of the honey to be lost.
As with other honey beers I’ve brewed, I added the concentrated nectar when primary fermentation was nearing completion (four days after pitching). This prevents destruction of the volatile aromatics by the heat of the boil, and scrubbing by the vigorous primary fermentation. For the first time I also saved a few ounces of honey to add directly to the keg for natural conditioning. I’m usually not an advocate for using priming sugar to add flavor, but the pressure should trap the volatiles, and I can a easily adjust the carbonation with CO2 once it goes on tap.
Batch Size (Gal): 11.50
Total Grain (Lbs): 25.38
Anticipated OG: 1.056
Anticipated SRM: 42.2
Anticipated IBU: 34.4
Brewhouse Efficiency: 70 %
Wort Boil Time: 75 Minutes
59.2% – 15 lbs. Valley Malting Pale
8.9% – 2.25 lbs. Rahr Pale
10.3% – 2.63 lbs. Home-Toasted Oatmeal (25 min @ 340F)
9.9% – 2.50 lbs. Simpsons Roasted Barley
3.0% – 0.75 lbs. Briess Crystal 120L
3.0% – 0.75 lbs. Simpsons Extra Dark Crystal
5.9% – 1.50 lbs. Meadowfoam Honey
1.38 oz. Magnum (Whole, 12.00% AA) @ 70 min.
2.00 oz. Challenger (Whole, 6.10% AA) @ 10 min.
1.00 Whirlfloc @ 15 min.
1.00 tsp Yeast Nutrient @ 15 min.
White Labs WLP028 Edinburgh Ale
Profile: Washington, DC
Sacch – 60 min @ 154F
2/13/15 Made a 3.5 L starter with 1 vial of month old yeast. Crash chilled after 24 hours on the stir-plate.
2/16/15 Brewed with some guy
Oats toasted at 340F 25 min. until they smelled toasty (only minimal color pickup).
Measured 5.3 mash pH.
3 gallon cold sparge. Collected 13 gallons of 1.045 runnings. Adjusted hops down by 1% AA.
Chilled to 65F, shook to aerate, pitched 2 L of the starter. 24 hours at 65F ambient, then to 58F ambient.
2/19/15 Back to 65F ambient to finish.
2/20/15 12 oz of Winter Park meadowfoam honey and 1/2 gallon of water to my half.
3/8/15 Racked my half (FG 1.020) into a keg with about 3 oz of meadowfoam honey. Purged and sealed. Left in the mid-60s to condition. Extra beer went into a growler with a small amount of the honey.
7/15/15 Tasting notes. Happy with the overall character of the beer, but the flavor of the meadowfoam honey itself barely comes through. I’d up it next time or find a more characterful supplier.
Source: The Mad Fermentationist
After six months, I’m pretty happy with my stout faucet and beer gas setup on the new kegerator. The only two exceptions are that the first tank of beer gas kicked before I served an entire keg; most likely that was the result of a regulator leak. I gave each of the fittings a turn and so far so good with the second tank. My other complaint is the dripping from the faucet, the small reservoir above the restrictor plate holds about a teaspoon of beer that slowly drips out over half an hour following each pour. Otherwise it pours a beautiful beer!
This Meadowfoam Honey Oatmeal Stout (recipe) is the second beer through after my Vanilla-Coconut Milk Stout. I’m thinking of brewing a Chocolate Pumpkin Porter next for the fall…!
Meadowfoam Honey Oatmeal Stout
Appearance – Beautiful depleted-uranium dense mocha head. The black beer yields amber highlights around the edges. Clear when it is thin enough.
Smell – High-quality chocolate bar, fresh toasty graininess. A hint of Raisin Bran. Also a touch of vanilla/floral, which I’ll generously attribute to the honey. Not a loud aroma, mostly thanks to the nitro (low carbonation means fewer CO2 bubbles to carry volatiles up to your nose).
Taste – Smooth cocoa roast, toasty, malty. More semi-sweet than dark chocolate. I can talk myself into tasting a hint of vanilla, but the honey is mostly a letdown. A hint of charcoal in the finish. Low bitterness, with plenty of sweetness, but it isn’t nearly as sticky as the milk stout.
Mouthfeel – I really like the thistle glass for nitro (I bought this one from Cristal Blumenau during our Brazil trip). Rather than allow the foam to float up out of the way with each sip (like a pint glass) it funnels the foam towards your mouth. Getting a bit of the head with each sip really enhances the creamy impression. Faint residual carbonation, tastes like maybe 1.2-1.4 volumes.
Drinkability & Notes – A nice stout, despite the July heat. The honey doesn’t come through as distinctly as I would have liked, but it adds depth to the chocolate. The raw honey itself wasn’t as punchy as the Meadowfoam honey that Ken Schramm passed around at NHC 2014, which is likely part of the problem. Next time I’d up the amount to two pounds, and try a different supplier.
Source: The Mad Fermentationist
Five modules into the EMBA, meeting up with classmates in Oxford has started to feel like meeting old friends, and the slightly unfamiliar role as student has gradually become less strange. The week-long modules give us a chance to …
Source: Said B School