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Your First 60 Days

Patrick McKenzie

Atlas

I work for the Internet, at @stripe, mostly on Atlas.

東京都 Tokyo
Patrick McKenzie

You'll learn:

  • How to beat decision paralysis
  • How to know exactly what to build
  • How to build a marketing platform to attract your perfect audience

Intro

Patrick ran five Software/training/consulting businesses from 2006 through 2016, and most recently started working at Stripe. His first Microconf was in 2011.

The Microconf mentality lets us lead the lives we want to live. Having a great business means you can be more present for our families and our communities, and have a better way of working. It's not just how you do it, it's also why you do it - don't loose sight of that.

The title of this talk - Your First 60 Days - is misleading. What you do over your first 60 days is important, but not nearly as important as what you do consistently over a 40 year career.

Keep an eye on the long game of providing value to your community and capturing value for yourself.

Decision making over the long haul

Decision paralysis as a founder can be worse than making the wrong decision. Instead of agonizing over perfection, it's almost always better to just ship ideas and see if they worked.

  • Make more small bets. Not ever decision you make needs to be the right one, so make decisions in a way that optimizes for learning. Very little of what you do in business are "trapdoor" (irreversible) decisions.
  • Decide quickly on reversible things that don't matter in the long run. Don't agonize about if you've hit perfection, just get it out the door. Making more decisions faster and learning from them is a better strategy than trying to make the perfect decision every time.
  • Maximize for the long term. You have a sharply limited amount of time as an entrepreneur - do things that will still matter and be relevant 40 years from now.

Grinding, duh

How are you going to build a business in the next 60 days? Easy - you're going to grind.

You don't need to be an expert, or have the perfect long term grand strategy, or know what you're doing: you need to go out there every day doing repetitive things that generate small amounts of value, and you need to keep doing it a lot over a long amount of time.

What should I build?

"What should I build" is the wrong question to ask first. Instead, ask "who do I want to serve?"

What people communities do you feel a calling towards? Don't look at building a business as a quick way to make money, look at it as a big part of your life for several years. The audience you pick will have a huge impact on your quality of life.

Patrick made the mistake of not choosing the people he would be serving first with a business that made a service for dental offices. Did he feel like he could bounce up every morning with enthusiasm at the prospect of talking to dental offices? Oh God no!

"Oh God no!" is the wrong reaction to have when thinking about your customers. To maximize your quality of life and chance of success in business, don't serve people you feel contempt for.

Instead, choose to serve people:

  • ...who you're energized in talking to. Who are you never tired to talk to? Who are you excited to work with? Patrick bounces with enthusiasm talking to Microconf people, and got really tired talking to teachers for the 6 years he ran Bingo Card Creator.
  • ...whose problems are tractable. Making a dent in global poverty is an awesome mission to have, and not one that a single person working really hard for several years can reasonably materially impact.
  • ...with money. Serve people who can afford to pay for your solutions, which usually means businesses. If you have charitable impulses, it's much easier and more effective to be charitable with a healthy business behind you than to undercharge.

Assemble your business piece-by-piece

Assemble your business piece-by-piece instead of striving for a perfect end state.

It's easy to look at currently successful businesses and think "wow, they have it all figured out," which can be discouraging. In reality, everyone is making it up as they go.

Even Patrick Collison - the cofounder of Stripe - has said that when going into early meetings with banks he felt like three squirrels in a trench coat.

Instead of targeting a business that's all put together, focus on adding a little piece at a time, similar to putting together a puzzle (though a puzzle isn't a perfect analogy - there's no perfectly defined end state in business).

View work on your business as snapping in another little puzzle piece that brings you towards a more finished product:

  • a little bit of marketing gets you a little more credibility
  • a little product development helps your customers to be a little more satisfied
  • a single conversation with a customer helps you understand their desires and needs a little better

Adding small meaningful pieces every day that will still be there in several years is a great metric for success.

Talk to people

Patrick Collison cold-emailed Patrick McKenzie when Collison had first developed Stripe asking McKenzie to try it for Bingo Card Creator. Cold emailing, if you can do it, is a super useful entrepreneurial skill.

It's never a bad time to talk to a customer or prospect. If you're capable of sending out cold emails, go for it.

If you hate setting up phone calls or emailing people, push through it. Talking to people is a tremendously important skill to develop as an entrepreneur.

Marketing platform before product

Build a marketing platform to engage an audience before you build a product. Like knowing how to cook, a marketing platform is a great way to always have friends.

What does a marketing platform look like? At least:

  • 3 "friend-catchers": If you know how to cook (a friend-catcher from Patrick's mom), you'll never lack for friends. If you build something that solves problems for people, you'll never lack people to talk to who have problems.
  • 5 emails: see the "Email course cheat sheet" section below for what these emails could look like
  • ~45 days of grinding: build the habit of talking to people every day. You don't need a grand strategy or a fancy process, just send a few emails and tweets.

The ideal friend-catcher

The ideal friend-catcher fixes a problem which is tractable, resonant, and underserved.

The ideal friend-catcher solves a problem that is:

  • Tractable: To genuinely solve the problem your friend-catcher promises to solve, tackle problems that are manageable. "How to solve global warming" probably can't be solved in a 7,000 word guide, but making more money with salary negotiation can.
  • Resonant: When your audience sees your friend-catcher exists, they should respond with "oh EFF yes! This is exactly what I need!" - that response means they're much more likely to share your friend-catcher. How do you find problems your audience will resonate with? Pay attention to the pains your audience has (ex: Javascript Developers feel visceral pain about build pipelines).
  • Underserved: There are many 101 guides to any topic, but 201 guides are scarce. There are many guides about specific technologies, but guides about how to use multiple related technologies together are scarce.

Great forms of friend-catchers

Amy Hoy's Ruby on Rails Cheat Sheet is the friend-catcher she used to befriend Patrick.

Things you're already good at making are likely great form catchers. If you're struggling for ideas on what specifically to build, try:

  • Stick-a-fork-in-it-and-it-is-done guide: Write the definitive guide on how to solve one broadly applicable and tightly scoped problem and people will use it for years.
  • Excel-replacement Calculator: Presenting a useful bit of math in a format that can be used by people who can't code is unreasonably effective. There's no calculation too trivial! (ex: A/B testing statistical significance is hard math for normal people)
  • Definitive curated list of resources: Plant a flag on the internet of a definitive list of everything great and outstanding in this field (ex: Josh Kaufman's definitive list of the best business books).
  • Cheatsheets: Amy Hoy made the Ruby on Rails Cheatsheet that turned her into a celebrity in the Rails community. Patrick was afraid to talk to her the first time he saw her in person because of her fame in making great friend-catcher cheat sheets.

Get their email

Stripe puts a call to action on every one of their friend-catchers.

On each of your friend-catchers, include a way to collect your audience's email addresses. You're effectively saying "hey, if you like this, give me your email address so I can send you more things you like."

Making a call to action isn't rocket science. Make a promise for what you're going to give someone if they give you their email address, and add a field they can type their address in. This strategy is unreasonably effective at collecting people who have problems you can solve.

Email Literally Everyone

In your first 60 days of grinding, make a habit of looking at everyone who's signed up since yesterday and sending them a personal email: "Hey, it's me! I'm unreasonably interested in this topic, and I'd love to chat with you about it."

Being able to individually email everyone on your list is a huge advantage that bigger companies don't have, so take advantage of it! As long as you can, make a personal connection with each member of your audience.

Email course cheat sheet

Here's everything you need to know about putting together an email course:

  • Make a promise with every subject line and overdeliver. This is the one copywriting trick you need to know if you know no others.
  • Write 75% of emails to educate and 25% to sell. Sales emails work best on their own instead of getting hidden in educational content. Don't forget to ask for the freaking sale, even if it's embarrassing!
  • Front-load delivery. Your audience will be at their happiest right when they sign up, so immediately start providing value. Emailing ~3 times in the first week and ~6 times in the first month is fine.
  • Email once ever 2-4 weeks after your email course ends. After the end of the course, then you can back off so your audience can decide if they actually like you. Promise "more things you like."

There's a world of people - find the people that love hearing from you, and establish the expectation that you'll be sending them more things they like.

For more on nailing email, check out Patrick's blog post You Should Probably Send More Email Than You Do and his email training course Hacking Lifecycle Emails for Software Companies. Patrick's course is free to anyone who has attended MicroConf - just send him an email for access!

Checkpoints

In the beginning research phase, you should be doing nothing but talking to customers. Try to hit:

  • 10 great conversations - 25 for SaaS
  • 500 email addresses. Don't worry about any kind of marketing automation until you have at least 500 people on your list - just keep writing.
  • 10 commits to buy - 25 in SaaS - or you'll have a super hard time selling it.

Once you've done that, you can move into the doing-cool-stuff-with-your-business fun expressive work of actually building something, but talking to customers isn't something you can grow out of. If you stay in this business you're going to be researching and talking to customers for the rest of your life.

Why wait to hit those metrics? It's too easy to hide in the code cave for a few weeks that turn into months without talking to customers. Commit to talk to people first and you'll develop better habits while you're developing.

Objective external indicia of progress

The work you're able to get done in a given week is extremely limited. Patrick finds it useful to organize his week like a dinner plate to combat business ADD:

  • one main dish - the main thing you want to accomplish this week, taking up half your dinner plate.
  • two side dishes - two things you want to get done that will likely get done this week, each taking up a quarter of your dinner plate.
  • dessert - everything else. Don't expect to get any desserts done.

One of your three weekly allocated spots on your dinner plate should be something you don't like but need to do, and one should always be talking to customers.

For every piece of work you do (except talking to customers), you should have some type of of progress that's published like a tweet or an article.

Build the actual thing

You're likely interested in this content because you already have the skill of building things pretty dialled in.

If you're feeling imposter syndrome, remember that building an awesome thing doesn't mean building the best thing. Your thing doesn't have to be a work of outstanding genius that will be studied 200 years from now.

The bar for businesses in the economy is just above making something so bad you get sued. This is disconcerting and freeing.

Abuse your advantages

Patrick was applying for a mortgage in Japan and was worried he'd be racially stereotyped by Japanese banks. His real estate broker said "don't worry - I got this," and followed through with 4 out of 4 approvals.

Patrick thought he'd just gotten lucky, but his loan officer let Patrick know that he had talked to every loan officer for two hours on Patrick's behalf, because "this is what I do."

"This is what I do" is an amazing sales message. You can become the person that's unreasonably good at the details of an esoteric topic, which quickly builds trust with customers.

Even if you just spend 60 days on a topic, you'll probably quickly become the world's leading expert in that specific thing. How many people are studying javascript pipelines?

Be irrationally responsive to customers, especially in the beginning. Huge businesses have very complex processes involving low paid employees. You can do so much better than that as an independent business owner every time because you're not just head of customer support making outlandish promises, you're the lead engineer that can fulfill those promises a week later.

Move fast and make things. Most companies in the world don't have a development team capable of making anything, or a marketing team capable of selling anything. You can build things that both increase the value of the thing you're building and increase your ability to market and sell that thing. For more on this topic, check out Patrick's past Microconf talk Building Things To Help Sell The Things You Build.

Charge more

Reasonable product pricing floors that work.

Charging more will get you more money, get you better customers, and attract people who you want to serve.

How much more should you charge? Whatever your number is right now, raise it.

If you charge in tiers, you can segment out customers getting outstanding value from you. Health Care businesses care much more about backups than other industries, so let them pay you more.

Boring Business Advice

Immediately

  • get a new business credit card and put every business expense on it to make accounting a lot easier
  • sign up for business gmail/google apps account for custom email addresses (ex: accounts@${domain}, receipts@${domain}) to organize incoming email and make it easier to transfer all of your accounts to someone else
  • use a password manager as a reminder of what your passwords are and what accounts you have.

Medium term

  • get an accountant - they'll make you the most amount of money of any professional you hire
  • find a peer group to talk shop with and meet regularly to bounce ideas off of
  • de-risk your family life with:
    • Retirement savings. Check out Wealth & Investing for Founders by John Knox at Microconf.
    • Insurance. Both term life and long-term disability
    • Go to the gym like it is your job

Stripe Atlas

If you're getting started, Patrick works with Stripe Atlas to help companies get up and running. They can help create a C-Corp, S-Corp, business bank account, and community of business people (including lawyers and accountants) to help you through problems.

Questions

Why don't you like blog posts?

My blog has ~3M words on it, and it was a mistake.

Don't make one of your life commitments keeping it up to date. A dead blog is worse than no blog at all.

Instead of a blog, post articles on your website that are definite evergreen guides.

How did you become such a good storyteller?

The Hero's Journey

I'm the storyteller of my Irish Catholic family's generation. It seems to work for me for business so I lean into it.

I don't have a great guide other than grinding at it. Tell more stories!

Try adopting narrative structure like the hero's journey.

Do you hate B2C?

I don't have an emotional hatred of B2C - I don't hate anyone anywhere. Hating people is a commitment of emotional energy in the future and I'd rather commit to positive things.

Google and Apple have a war chest of hundreds of billions of dollars. You can't beat them at the B2C game.

If you have to create a B2C, pick a demographic that has some money to pay and is super emotionally invested. Most consumers are pathologically bad at spending money on things. Pro-sumers like skaters who spend $800 on skates or error rendering link are better.

How do you split time spent talking to customers vs. building your product?

It depends on where you are in the cycle. I do 50/25/25 to tactical marketing/talking to customers/product.

If I didn't have a laser focus of what the product is, I'd spend the 50 on talking to people. Do it first thing in the morning so you can do the trivial, easy, fun work of building stuff later.

My favorite talk is your Hello Ladies talk from Business of software where you recommend building products for underserved audiences. How do you build things for people who aren't like you?

Even software for software developers is a huge market opportunity - if you're building software for people similar to you, it's probably still a good market.

Some markets can't pay, so don't serve a market like that. A market like "women in tech positions" is a great underserved market.

Chat with patrick at @patio11, patrick@kalzumeus.com, or patio11@stripe.com.

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