When a friend left his job, his coworker made the surprise comment that he was about to leave the company as well. What seemed like a few minor problems on the team soon snowballed into a costly mass exodus.
Employee retention is one of the most overlooked aspects of managing your team…right until you start losing good employees. It costs much more than you might expect to replace them. I was curious myself just how much it could cost and the surprising results are below.
Note: All salaries are assumed to be $100,000, which is $40/hr assuming you work 50 hours a week for 50 weeks a year. Adjust the numbers accordingly if anyone costs more or less for you.
The Costs of Sourcing a Hire:
Unless you’re a really hot company, it’s unlikely that great people are beating down your door to fill open roles. And even if you are well known, the best people probably aren’t refreshing your jobs page for an opening. You have to go find them.
You can source candidates a ton of different ways, but they all cost money either in the form of payment to another company or in time invested by one of your employees.
With just a few attempts at sourcing some good hires, between third party costs and labor in your company, sourcing costs can easily reach over $26,000. The scariest thing is, you haven’t even interviewed any of these candidates yet!
The Costs of Interviewing a Hire:
Now that you have a full funnel of candidates kickstarted, you start the dreaded interview process. You’ve got to filter through all the LinkedIn profiles, social accounts, resumes, and cover letters to find those gems who will then navigate your hiring process.
Here the costs are a bit more hidden. It’s all about lost time for various team members. What other great work could your team be doing instead of working on candidate hiring? Every minute spent hiring is a lost dollar invested in your business.
Assuming you have a clear funnel where you only have to look at 120 resumes, only have a third of them make a phone screen, a quarter of those make it to in person interviews, and you prep 3 offers, interviewing costs you over $5,000. For some specialized roles it could be significantly higher if you have many more interviews and phone screens.
The Cost of Onboarding a New Hire:
Congratulations! You found the candidate you’ve been looking for. Now you need to onboard them so they become a productive, integrated member of your team. Again, you have hidden costs. Now, you have losses both in how productive a new hire is versus a veteran on your team, and your team training them (an important investment, but also a significant time sink for your team).
When you hire an employee, there’s often some kind of bonus you need to give them. It might be a salary bump, moving costs, or something else to sweeten the offer. It’s part of the cost of doing business. When you combine that with your costs as they start on your team and get up to speed, onboarding can cost you over $10,000.
Of course, we’re assuming your hire works out, which unfortunately, it won’t always. You can go ahead and double these costs and many of the ones in earlier sections if you have to go back to the drawing board on another candidate.
The Cost of Lost Productivity:
While your team member has departed, the show must go on. The rest of your team has to cover for them, whether that means writing their code, calling their leads, or finishing their reports. As much as you’d like to think the rest of the team can just make up for them, if the hire really was good, that’s impossible. When someone leaves, team members are distracted. Those that were close to them in particular will be less focused and productive. They’ll probably grab beers with their friend before they leave, when they otherwise may have worked late.
Meanwhile, if you push your team to cover for them, the stress and extra hours can affect their physical and mental health, which will lead to vacation and sick days. If hiring drags on, you’ll probably hire a consultant or freelancer to cover which could easily exceed $100 an hour for their work.
All of this combines to lead to a Productivity loss cost of over $24,000.
So let’s add this up…
Ouch! Replacing even a single team member is expensive! Wouldn’t it be a lot cheaper to retain all your good people?
What can you do?
Next time a good employee asks for a raise, investment in equipment to help them on their job, or a morale boosting opportunity is presented, consider the cost of losing them before saying, “we have no budget for this.”
If your manager is blocking you from helping your team, remind them what you’re asking for is a lot less than the $65,000 cost to replace a lost member of your team (let alone the cost of multiple losses!).
While free lunches, ping pong tables, extra vacation days, and other perks are a nice bonus, they aren’t what keep people at a company. Even raises only satisfy people for a short period of time.
What really retains teams is managing people well.
This comes by having discussions with them about their personal growth & goals, company and self-improvement, and recognizing the things that are important to them personally.
I know that’s easier said then done. You have a million things on your plate as a leader and what little time you can spare has to be maximized. And it probably isn’t right now.
You have notes on people all over the place. One on ones are sporadically effective, because you may not always be prepared for the next one. Goals are a great idea in theory, but they’re buried in your HR app you can’t stand. There must be a better way.
That’s why I started Lighthouse. It helps you stay on top of what matters quickly and efficiently for each of your people. It’s designed with managers like you in mind, because I’m a manager myself.
If you want to be the manager people love to work for & save the costs of replacing people, sign up at GetLighthouse.com.
Whether you’re young or old, we all have dreams and aspirations. If you can help someone uncover those goals, then encourage them, and tell them you believe they can do it, you will truly inspire them. As a manager, believing in who your people can become is the most powerful thing you can do.
Think back. When was the last time someone believed in you? When did someone give you a task that pushed you beyond what you’ve already done? When did you last hear, “I know this is a big challenge for you, but I believe you can do it and I’m here to help.”
If you haven’t heard it, I’m sorry. Do it for someone else and see how they light up. If it’s something they truly aspire to, you will see some of the best work you’ve ever seen from them (and for *all* their work, not just related to their goal). They’ll also be very receptive to your feedback and guidance.
I have been endlessly amazed with what members of my Greenhorn Connect team have been able to do over the years because I’ve believed in Paul, Pardees, Angela, Ariel, and others. I saw them for more than the inexperienced members of the startup community they were when each of them joined the team.
Instead, I focused on the skills they could build on and listened to what they said they wanted to become. Greenhorn Connect would not be what it is today without them rising to the occasion in each of their roles, especially since I moved thousands of miles away from the business 2 years ago. And it all started with believing in them.
See more in people.
“If you always do what you’ve always done, you’ll always get what you’ve always got.” – Henry Ford— Get Lighthouse (@Get_Lighthouse) June 20, 2014
Ford’s quote is true for you, and it’s true for your team. Don’t waste your team’s careers only doing what they’ve always done. Uncover their aspirations and find a way to make your company or your department a conduit for them to achieve their goals. Even if they outgrow their role, the quality of work you will get before they do so will astound you.
Life is too short to be boxed in by what you’ve already done. Be the one person that sets them free to grow and you will have a friend and ally for life. This is why the best leaders have people that work for them again and again. It’s not because they like the box their leader puts them in; it’s because that leader helps them truly reach their full potential.
How can you do this?
It starts today. You should be regularly discussing your team member’s goals and the work they’re doing. No other forum is as helpful as leveraging 1 on 1s for this. In those 1 on 1s, you can discuss their progress, coaching, and learning opportunities. You can also keep a pulse on what they really want, as it will change over time.
Take time and reflect on each person as you prep for their 1 on 1. What are their strengths? How can you help them grow in their role? Progress is the spark for the fire of motivation for each of your team members. Help them feel that progress in their role.
As your team grows, keeping track of all of this can be a struggle. It’s not that you don’t care; it’s that the demands of your job only give you so much time.
To make the most of the time you do have, track everything and stay organized with Lighthouse. I’ve built it to help myself as a manager, and it will help you make the most of every 1 on 1 so you have an excited, engaged, team you believe in.
When I was fresh out of college with a internship at E Ink (maker’s of the display screen for the Amazon Kindle) I emailed the founder and then CEO, Russ Wilcox, to see if he would meet with me to give me some advice on entrepreneurship. Lucky for me, he was willing to schedule a meeting before my internship ended. You can read the full story here, but one of the best pieces of advice he gave me during our meeting was simple, yet powerful: Read 100 Books.
At the time it almost didn’t make sense and led to more questions than answers. What books? Why that many? How fast? By when?
I remember frantically writing down a bunch of book titles he started mentioning and then he stopped me and said the important thing was that they were on a diverse set of topics with different viewpoints instead of any specific books. He suggested trying to read 5-10 on categories like sales, marketing, leadership, negotiation, etc.
5 Years and 4 months after that conversation, I’ve finally hit the number and now looking back, I realize it’s one of the most important pieces of advice I ever received. I would not be where I am today if I hadn’t read as much as I have. Reading 100 books has done all the following for me:
Helped me better understand the responsibilities of coworkers (especially important as a product manager and startup founder).
Being comfortable in a conversation on just about any subject due to what I’ve read.
Rapidly improved my skills in key work responsibilities helping me accelerate my career and avoid costly mistakes.
If you’re reading this, I encourage you to also read 100 books. But realize it’s not about the number, but a routine of reading regularly that will serve you well throughout life.
Here’s my quick advice on how to make it happen and make the most of it:
1) Read what you can apply immediately.
I’ve managed to read a wide variety of books that have helped in my career and I’ve always chosen books based on what my current challenges and interests are. This has helped me apply concepts I pick up as I read a book, usually over the span of 2-4 weeks, depending on the length.
When I was moving to SF to run product at KISSmetrics, I started out with a great book on Product Management, then dove into a few books on design, before finding myself diving into sales, marketing, leadership and strategy books depending on what was happening at work and my personal life. Every time, I found great ways to build on what I read in my life around me which has helped tremendously with retention and understanding.
I read on public transportation. First it was riding the T in Boston and now MUNI around SF. I love this for so many reasons:
It gives you something to look forward to even when a bus commute might be lengthy.
A book won’t get stolen like your cell phone might be when you have it out as you play Angry Birds/check Facebook, etc.
It gives you bite size chunks of reading as most rides are 10-30 minutes…just enough for a chapter or two.
A book is a great way to get just a little bit more personal space on a crowded bus.
It’s a great warm up and cool down to your work day if you read during your commute.
If that’s not an option for you, build a routine around it in some other way. Maybe it’s 20 minutes before you go to bed, while you eat breakfast or perhaps audio books while you drive to work. It is the routine of always reading something that will carry you through that many books over the years.
4) Carry your book around with you.
Nothing sparks a conversation like someone noticing what you’re reading. Often those that notice read a lot too, which is a great way to make friends and you can get more recommendations for books from them. This also means that if a friend is running late, you always have a productive way to fill the time. I brought Dale Carnegie’s “How to Win Friends and Influence People” with me to Bootstrap Live and ended up talking with Andrew Warner and the guy next to me about how much we all loved it.
5) Write all over your books.
Despite working in technology, I still prefer physical books in my hand. I underline, I highlight and dog ear all my books. Something about it helps me with retention of what I read. Even if you prefer to read on a tablet or Kindle, be sure to take notes and challenge yourself to think about how to apply what you’re reading. It helps a lot to review books you’ve read before when you have that subject come up. It’s amazing to me how often past events line up as examples (or counter-examples) of something I’m reading. I’m always sure to take a moment to consider it and write it down in the book.
6) Always make progress.
Life doesn’t always go as hoped or planned. There are times of frustration and stagnancy both personally and professionally in all our lives. I’ve found one of the best things for me is knowing that no matter what is happening in my life I’m always learning because of what I’m reading. I can always look back and see progress there.
It has also helped that when I’ve had down times, if I read something related to it like a book on happiness or successfully navigating your 20s, I’m actually being proactive about the problem and getting advice from someone great who took the time to research and write a book about the subject. —
Remember, this is not a race. The point of reading all these books is to absorb all the ideas and skills shared in the books, not race to the end.
I’ve heard some people like to skim books and think that doing things like reading the opening and closing paragraphs of a chapter and reading headlines in the chapter is enough. They’re either reading the wrong books or missing out on some deep lessons.
As a wise man once said, “Anything worth doing is worth doing well.” It is the journey to 100 books that I both enjoyed and grew tremendously from…not the milestone of specifically 100 that matters to me; I haven’t stopped reading and won’t anytime soon.My Amazon Wishlist is longer than ever (please suggest the best books you’ve read in the comments!) and I can’t wait to learn through more great books for the rest of my life.
You can have the best idea in the world, but until you find someone besides yourself that wants it, it’s not really a business. To find those people, as Paul Graham wrote in a recent essay, you have to “Do Things That Don’t Scale.” The problem is, it is often unclear what those “Things” are.
Understand you’re going to have a low success rate.
There is no silver bullet for finding users for your startup, just tactics like the ones below that work to varying degrees depending on your idea and market. Even for good channels, a 10-20% response rate is normal, so don’t get discouraged.
Don’t worry about scaling! None of the ideas below are really scalable when taken literally. However, like Paul Graham said in his essay: don’t worry about scaling right now. Just do whatever it takes to find people and the scalable methods will emerge later. If you have a cofounder worried about scaling early, have them read the Paul Graham essay.
Remember your manners and personalize. You’re likely asking people to talk to you when you have nothing but an idea and maybe a prototype of some sort. Be respectful in communicating with them. Also realize that no one likes a form note, so the more you personalize it and make it feel like they’re special, the better chance you have of a response. Elizabeth Yin of Launchbit has an awesome slideshare with advice on reaching out to customers effectively.
Don’t get banned.
If you abuse any of the tactics below, many of the sites and groups will ban or block you. Pay attention to restrictions to how often you can do certain things (like Meetup.com allows you to message 12 users per day). Realize the more times you break a terms of service, the more likely you are to get noticed and banned. On the flip side, it is easier to ask for forgiveness than permission. Just don’t be egregious.
A special thanks to these people that helped edit & provide ideas for this post:
You can sign up for updates and early access to chapters that will help you build product customers will love by signing up here.
95 Ways to Find Your First Customers for Customer Development and Sales
1) Use Linkedin Answers: Look for people asking questions around your problem and market or ask your own.
2) JoinLinkedin Groups: Join Linkedin Groups for your target market. Engage in discussions there, reach out to people that post relevant ideas or questions, or post looking for help.
3) UseSearch + InMail: If you know the kind of person you want to talk to, try searching for them (like VP Marketing at companies between 25-200 employees) and using InMail to message them.
4) Check your existing connections: People change careers a lot more than you may expect. You may have also lost touch with an old classmate that is now in just the right market. Either way, your existing connects are very likely to respond and you’ll have access to their email address, which is better than their LinkedIn inbox.
5) Ask your connections for intros: It’s quite possible the perfect people to talk to aren’t already a connection, but they may be one degree away. Don’t be afraid to ask connections you have a good relationship with for an intro.
6) Post to the Linkedin Social Network: Linkedin now has status updates you can post. It’s a lot less active than other networks, but it can’t hurt to see if anyone notices.
7) Run Linkedin Ads: Linkedin is the network for professionals and their careers. If your startup idea has them as the target customer (say marketers or executives), then an alternative to the high maintenance of Linkedin Groups can be to run ads. Linkedin also has a partner network for a lot of business content sites which can further the reach. There’s a great guide on KISSmetrics for Linkedin Ads here.
8) Look up your friends: For most people, their closest people in their life now and in the past are on Facebook. If you haven’t already exhausted your existing network on Linkedin, definitely look to see if any of your friends are in the market and worth talking to.
9) Ask your friends: There’s also a lot of random people you met in college and other times. You never know who knows who so you have to ask. I just got introduced to another person in tech through someone I was in a beirut league with in college.
10) Look for Fan Pages: There’s fan pages for just about anything you can think of. People that run those pages in your market are great people to talk to both as potential customers and to see if they’ll post something on your behalf on their page. Friends who have leveraged this have found it cheaper than Facebook ads, even when they pay the Fan Page owner. Just click the “message” button on the fan page.
11) RunTargeted Facebook Ads: If you think you really know your audience demographics, then running a small set of Facebook ads to a landing page, can be a great way to garner interest.
12) Try the new Graph Search: I haven’t had a lot of success using it, but it’s worth searching for things related to your market to see if anything else turns up, especially now that you can message people you aren’t friends with. In particular, Facebook has a great geographic filtering ability you won’t find on Twitter or otherwise.
Twitter: (My personal favorite)
13) Ask your followers: If you have any kind of follower base at all, you should definitely tweet about who you want to talk to. If you don’t have a big follower base, ask the people with bigger followings you’re friends with to ReTweet you. As you develop your idea, you may want to tweet different requests, which may be seen by different people since no one sees every tweet of their followers.
14) Ask your followers for referrals: It’s not just about who you know. The bigger benefit is who your network knows so be sure to not just ask people you follow or follow you if they’re a fit, but ask others for referrals.
16) Ask Twitter Accounts to tweet on your behalf: Just like you can ask Fan Pages on Facebook to talk about you, you can reach out to Twitter accounts in your target market to see if they’ll tweet something for you or ReTweet you. If it makes sense for your business, you can also ask some celebrities via tools like BuySellAds and Sponsored Tweets.
17) Search for relevant Hashtags: Hashtags are a big part of Twitter for many markets. For example, in the analytics market, there’s #Measure. Find accounts using the hashtag and reach out to them and join the conversations happening. Find relevant hashtags by asking others or checking out sites like Hashtags.org
18) Join a Twitter Chat: Many groups have regular chats that can be found based on the group’s hashtag they use. A great example is the Community Manager chat, #cmgrchat. This is a great way to ask questions and engage your target audience if they’re holding Twitter chats.
19) Search Twitter for People Talking about your Problem: Remember that time you were really annoyed at a company? What did you probably do? You tweeted about it. Try searching different ways for people talking about frustrations and you’re bound to find people happy to talk because they’re excited someone is going to make things better. I’ve successfully used this to talk to people about, of all things, email migration.
20) Email relevant friends/contacts: There’s a right way and wrong way to do this. Yes, you can spam all your contacts in one big dump asking for help. What will yield a better result is if you invest the time to be more targeted in who you reach out to. Close friends and family won’t mind and those actually related to your target industry.
21) Start a personal newsletter: I’ve known some people to start a personal newsletter to have their contacts *opt into* that then regularly updates them on your startup journey and can ask for specific help then repeatedly in the newsletter. This works great for getting mentors and early supporters engage in a small ask (just opt in) and later help more as you have different needs.
22) Use Rapportive to find emails & cold email: Somehow you may have stumbled upon someone you’d *love* to talk to, but you don’t know them. You can use tools like Rapportive to guess the email address and send them a personal note asking to speak with them about what you’re working on. You can find more advice on this tactic here and here.
23) Make your GChat status a call for help/intros: This may seem simple and passive, but you’d be surprised who reads your GChat statuses. Adding a note of what you’re looking for and leave it up for a few days and you might just get a few people to help you out. This works for other chat tools as well, of course.
24) Make your signature a call for help/intros: Just like your GChat status is a long tail way to get people’s attention, you can use your email signature the same way. Below your name in your signature is the perfect place to let people know. Don’t forget to update your mobile app’s signature as well as your computer’s.
25) Join & Attend Meetups in your category: Meetup has become an amazing hub of groups around just about any topic you can think of. Whether you’re making an app for LARPers or a hardware startup, there’s a meetup group likely in your area you should join to meet and talk with group members in your target market.
26) Ask organizers to message the group: Organizers have unique privileges to send messages to their groups. You don’t get what you don’t ask for, so don’t be afraid to reach out to group organizers to talk to them (they may be a great target user) and see if they’ll message the group. They often make no money in running their groups, so you can think of them like the Facebook Fan Page owners previously mentioned.
27) Ask the organizer to allow you to address the audience at a Meetup: Potentially even better than getting into everyone’s cluttered inbox is the opportunity to address the whole group at one of their events. This allows people most interested to immediately approach you. This can be a great consolation ask if they don’t want to message their whole group since this requires no work on their part.
28) Mention in your Meetup profile what you’re looking for: Like the GChat status, this is a passive move that alone won’t get you everyone to talk to, but you’d be surprised how often people read the profiles of other new members in a group. Be sure to include your desired contact method if you want Meetup members to reach out to you.
29) Message users on Meetup.com: Not every member of a Meetup group attends every event and if there’s no upcoming meetups or it’s a group outside your area, you can still reach users by sending them individual messages. Per a great write up by Melissa Tsang, Meetup has a limit of 12 messages per day, which is still enough to get some quality responses as she writes in detail about.
30) Create a Meetup group: Just because a group doesn’t exist, does not mean there would not be interest. Countless people have launched successful businesses based on the idea of organizing a high value group. Just remember that if you do this, not only will you build trust and relationships with all the attendees, you’ll be the organizer who can send all those messages, decide who addresses the audience, etc.
31) Write a blog post about the problem you’re solving: If you feel you know some of the key problems that users are facing in your target market, write about it! If it resonates with them, they will share, upvote, tweet, etc it and some will even sign up as long as you remember to have a call to action to sign up at the end. You can see an example here, where 1,000 reads turned into 10 sign ups and a look at some famous companies that started with a blog here.
32) Post your blog to discussion sites in appropriate categories: Sites like Reddit and HackerNews are awesome to access established audiences for your market. Before posting, do your homework so you actually post it somewhere it’s welcome; a baker would not be well served to post their baking innovation on HackerNews, but a marketing startup would do very well posting to Inbound.org. By posting it to these sites you’ll significantly increase the reach of #31 and might also get some interesting commenters there you can reach out to like this example from Vero.
33) Update your About Page for what you’re looking for: Just like #23 and #28, it is always beneficial to list what your looking for on your About page. The most engaged people on your blog are likely to click to your about page to see who you are and if they see this, they can help even if they don’t read your specific blog post about your idea.
34) Make a page on your blog just about your market: Depending on your blogging platform, this could be easy or hard, but it can never hurt to organize your information in a way that people can easily navigate it. If you’re writing a whole series of items or have already created a lot of related content, this can be a great way to assert your expertise and act as a honeypot to draw in interested potential customers.
35) Start a blog just to talk about your industry: Don’t already have a blog or don’t want to talk about your startup on your existing blog? Then start a new one. It helps to have more content than just one post, so if you go this route, try to have a few posts you can post over a few weeks. If you know your startup’s domain, you can make this the start of your company’s blog. Especially for blogs like this, try to get users to either sign up for an email list or to explicitly sign up for customer interviews.
36) Reach out to other bloggers for interviews: Chances are, there are other people writing about the market and potentially even the problem you’re interested in solving. These people are generally very knowledgable on the market and so they make great customer interview candidates and can also shed a light on more places to look for people in your market.
37) Ask other bloggers to run an ad for you: Many bloggers, like those fan page owners, don’t make a lot of money, so they may be willing to run an ad for you for very cheap or mention you in a relevant post just because they’re nice or like you.
38) Ask other bloggers to write about you: Going beyond an ad (which may be seen on multiple posts) you can see if a blogger is willing to write a whole post about you. If you’ve already interviewed them and they’re excited about your idea, this may be an easier ask than you think (and thus do it for free).
39) Ask to write a guest blog post: If your own blog has no audience, the best thing you can do is get a post you’d write on your market/problem on a blog that does have your desired audience. Bloggers love having more content to share, so if it’s a good post, they’re very likely to be willing to publish it. Look for guidelines and advice on guest blogging on sites you want to write for like on KISSmetrics’s blog.
41) Reach out to commenters: If you see passionate comments on someone else’s blog, follow the link and the profile/name from the comment to find out who they are and reach out to them. People usually will include a link back to their own blog, About.me profile or Twitter account from such a comment. This will give you a more direct, personal way to reach them, and avoid writing a bunch of comments, which the blog owner may then mark as spam and never be seen.
42) Reach out to people that ask relevant questions: If you can see who asked a good question related to the problem you’re solving, reach out to them using any methods the site allows to see if they’ll do an interview.
43) Answer questions about your problem/market: If you’re already knowledgable on your market, don’t be afraid to jump in and answer open questions. The people that ask can become great people to talk to and are more likely to be responsive if you already helped them with your answer. Don’t be afraid to drop a mention of what you’re working on right in the answers. Thomas Schranz at Blossom.io has done a great job of doing this in a helpful, non-spammy way.
44) Reach out to great answers: If you see someone who has given some great answers, they are likely very knowledgeable in your market and the problem you’re solving. Reach out to them to do an interview. Obviously, you’ll want to be careful it’s not a competitor. ;)
45) Ask questions to see who answers: There’s no reason not to join the conversation by asking questions as well. Reach out to the authors of any answers you find satisfactory or interesting. The best part of asking your own questions is that virtually every Q&A site will send you alerts when your question gets answered so you can easily keep track of them even if you ask a few.
46) Put Calls to Action in your Profile and Answer Subheadings: Sites like Quora allow you to put whatever subheading you want below an answer, so don’t be afraid to mention something about your startup there. Also, like the other sections, always put in your profile what you’re up to so anyone that checks you out (even for answers you may have written in other areas) can find you and potentially reach out.
47) Approach people in native environments: Would your target customer be found in a coffee shop, grocery store or mall? Then go there and try talking to people. Like anything this is a skill. This can come off as harassing or creepy (and the store may ask you to leave) or it can work great. The founders of Sincerely have been know to walk over to a nearby mall and offer strangers money and app credits so they can see how a user uses their app.
48) Look for people unhappy with a service: Are you trying to make a real world activity (like finding a locksmith or a good mechanic) better? Then looking for disappointed people near that service may be just the unhappy customers you could delight with your service. After taking a bad cab ride, you’d be the perfect person to explain all the reasons you’d likely prefer to take an Uber next time.
49) Go to conferences for your target audience: Just about every industry has a few conferences related to it. Established businesses get booths, thought leaders speak and many deals get done. You should be there too as you’ll never find such a concentration of people in your industry. Take advantage of attendee lists to figure out who you want to meet with. Offer to volunteer or just ask for a discount ticket because you’re a startup and you’ll be surprised what you may get.
50) Go to trade organization events: Depending on the business you’re in there may be regularly “Chamber of Commerce” style events where your target customers may be. This would work especially well if you’re targeting people who own brick and mortar stores or provide contract services.
51) Go to places you know they’ll congregate: Have an idea for people that own boats? Then going to your local marina is a *great* place to find boaters to talk to. Golfers might just be at the golf course or driving range, frequent fliers at an airport and teachers at a school. Timing is obviously everything, so be cognizant of when someone looks like they’re approachable and have time to kill versus trying to hurry somewhere else.
52) Ask people on long train rides or airplanes: I’m always amazed by the kinds of people I meet when riding Amtrak or flying. Sometimes serendipity can work in crazy ways, so don’t be afraid to tell random people you meet what you’re working on. They might just be helpful or someone nearby will overhear and jump in.
Your existing user base (even if small)
53) Offer a user Referral Program: You need a great product before you should be trying to aggressively hack your growth, but that shouldn’t stop you from offering an incentive to your existing users to help you get more users. They likely know where to find more of them (their social graph, emailing friends, etc) so a little incentive will get them to help you out. There’s a great Quora thread on the subject here.
54) Ask your users via email: Especially in the early days, you should regularly talk to your users and be updating your whole user base regularly. As part of those updates for new features, major bug fixes and outreach, don’t be afraid to ask them for referrals to more users or people to talk to.
55) Always ask your users when you talk: Whether you’re doing a customer development interview, usability testing or just talking to a user about a support case, remember that you don’t get what you don’t ask for. Ask them both if they know anyone specific who might also be interested in your startup as well as places they generally find other people. The latter may turn out to be a meetup, a Twitter chat or something else that is very target rich for you, but you would never have known.
56) Look for relevant postings: Does your startup idea do anything that is relevant to one of the many Craigslist categories? Quite a few companies have had great success building a massive business off just 1 category (see below). Try reaching out to posters to talk to them and later you can potentially scale this. AirBnb is the most famous recent example, which Andrew Chen highlights well here.
57) Make your own post: Just like you can respond to posters, you can also make your own posting in the appropriate category and filter the ensuing responses to find the right people to talk to. A friend working on a startup recently used this to success by making a basic post and then sending all respondents a qualifying survey to make sure they were a match. A small cash incentive in the posting will generally drive a solid response rate.
Forums, Micro Networks & Communities on the web
58) Join in the conversations on the sites: Just about any community exists on the web today. Many of them are in places you would have no idea exists until you dig in. If you can’t find them initially, ask some of the early users you meet using some of the other tactics listed in this post. Once there, look around for people already talking about your problem you’re solving and join that conversation to learn more. You can also post new discussions specifically on your target subject to see who is interested.
59) Message individual users of interest: If you see someone talking a lot about the problems or opportunities you’re working on, see if you can send a private message to them on the forum or at worst just reply to one of their comments asking to speak with them. Anyone sufficiently passionate will be excited to share their thoughts.
60) Reach out to moderators: If this is truly a community site (and not another company’s forums) then the moderators are often the most passionate people of all. Reach out to them as great people to talk to and learn from. As a moderator, they’ll be spending as much time as anyone following all the conversations there so they could provide valuable insight beyond their own experiences. If it is a company’s forum, then tread a bit more carefully depending on if your idea is competitive or complimentary.
61) Ask Moderators to post on your behalf or run an ad: Many forums on the web are run with very little revenue and more as a passion project. Therefore, much like some of the previously mentioned Fan Pages, etc, they may be open to posting on your behalf or running an ad for a very small fee. They’ll know the ins and outs of the site, which will give you a better chance of reaching the maximum audience.
Google Adwords & other ad networks
62) Run Adwords with a landing page: An efficient (though at times costly) way to build an early user list is to run a quick, targeted Adwords campaign linking to a sign up landing page. You can learn how to set that up here. There’s also good advice on evaluating the success or failure of such a campaign here and here. Realize that paying to get a bunch of people on a list doesn’t validate much on its own. It’s then using that list to reach out to users and talk to them and ask them to pay for something that does.
63) Run ads on lesser known networks: Google may have the largest audience, but not the cheapest or best targeted. Consider your market and think about if other ad networks would work better. There’s everything to consider from Yahoo and Bing to mobile ad networks or blogger ad networks. You can find a list of alternatives here.
64) Have your SEO basics in order: What’s better than the perfect Adwords campaign? Showing up organically for searches on your problem. Great SEO takes time, but you can make sure to have the basics right from day 1 so that you can at least get a trickle of interested users to your blog or site. There are a lot of great tips on the KISSmetrics blog including this great SEO Guide for Beginners.
65) Talk to newsletter owners: Just like passionate people often run forums simply for the love of it, others will run newsletters. If you already subscribe to them, don’t be afraid to just reply to the newsletter and ask for a few minutes to talk to them. Most people are excited to hear from people who read their work!
66) Buy Ads using a newsletter ad tool: There’s a great newsletter ad network called Launchbit. It can be a great help in both finding out what newsletters exist in a category and allowing you to quickly set up an ad campaign across multiple such newsletters.
67) Ask for mentions in a newsletter: In addition to talking to newsletter owners as potential early adopters, you can also ask them for exposure. Many newsletters have no formal advertising system like Launchbit, so often you can just go direct to them to ask for a mention for little or no cost. The more excited they are for what you’re doing, the less likely it will cost you anything.
68) Start your own industry newsletter: If you don’t find any newsletters in your category or are think there’s room for another one, then don’t be afraid to start your own! It will take time to build up an audience, but it’s a great way to put to work all those signups you’ve been driving to your landing page. Often times, it’s easier to first get people on a newsletter and then later convert them to a paying customer.
69) Reach out to complimentary startups: No matter your industry or idea, there will be others in the market you compliment. At KISSmetrics, there were many other SaaS tools we were happy to integrate with and swap customer/mailing lists. In most cases, our analytics was something their users needed and many of our customers could use a support tool, call tracking metrics or track a MailChimp email campaign. The best case for success with this method is to target companies of similar size (ie- mailing lists and user bases are of similar size) as that assures an equally mutually beneficial relationship.
70) Ask to guest post on their blog: Just like there are industry blogs run by volunteers and people just generally passionate about the space, there are also companies with prominent blogs. One of the biggest challenges they often have is having enough content. Reach out to someone on the marketing team or any contact info you see on the blog and propose topics that allow you to naturally link to what you’re doing.
71) Find their users and reach out to them directly: If you think your idea would be helpful to that company’s audience, look for people actively engaging and discussing the company on all the platforms I’ve been writing about throughout this post. While it’s better to ask for forgiveness than permission, remember again to use tact so as to not be spammy or offend the company.
72) Watch what they do: As the saying goes, “When in Rome, do as the Romans do.” Chances are your competition has figured out at least a couple of spots where your customers exist and you can enter the conversation there as well. In more modern terms, if something they do works, then consider Jobs’s favorite quote, “Great artists steal.” Like their Facebook page, and follow the company and key employees on Twitter for some inspiration based on what they link to.
73) Look for social mentions: Especially if you’re trying to disrupt a large incumbent, there’s likely many people talking about your competition. Look for especially people complaining about the product or experience. These are perfect people to reach out to learn from and hopefully convert to giving you a try. This also works for other startups you’re competing with.
74) Use research tools: Tools like MixRank, which shows the ads a site has been running, and Spyfu, which shows you the expected ad spend and keywords purchased for competition. If you’re looking for inspiration on the kinds of ads to try, those tools will help you get there.
Data Research Tools
75) Use Datanyze: This tool will tell you what apps any of the top 1,000,000+ websites are using as well as what they’ve recently quit. It’s transformed more than one sales team I know and provides priceless information on the state of just about any web SaaS market. Their free demo can help you understand market share, while the pricey version has alerts for specific tools and lets you see what any site is currently using.
76) Leverage tools that tell you contact info for key roles: If you know the persona of your target customer, then a list like Hoover’s or Jigsaw can help you find some of those types of users at especially bigger companies. Note that this lists they have aren’t 100% accurate, nor are they cheap. Try to hustle access via a friend or advisor.
Your College, University or School
77) Ask your professors: Many professors live vicariously through their students, and are happy to help out current students as well as alumni. If you had a professor that you had a particularly strong relationship with that is relevant to your startup, definitely reconnect with them. Also realize that many professors will talk to alumni who they never taught. Most professors have industry contacts they can help you with introductions as well as be a great channel to their students as potential customers or hires whether via emailing them or letting you address the class.
78) Leverage your alumni network: Whether it’s old clubs you belonged to, a fraternity or sorority or simply the alumni group for the city you’re in, you’d be amazed what people may be doing after school regardless of major or study habits. Don’t be afraid to both reach out to old classmates and club members as well as reach out to the clubs themselves for help from current members. Every student group I was in loved to hear from alumni.
79) Use your alumni directory: Many schools have searchable alumni directories that can allow you to track down contacts at some of the most powerful positions in the world. The shared experience of going to the same school is often all you need to mention to get someone who normally would be unreachable to suddenly be accessible to you for a meeting, mentorship or the right introduction.
80) Reach out to student groups: Even if you weren’t a member of the group, student groups are usually excited to hear from alumni. If any student group fits as a target customer for your startup, you should reach out to them. Playing the alumni card often gets you a great response and can often lead to offers to help you in many ways. They can email their list, let you address the group at a meeting or assist in recruiting help.
Leveraging the Physical World
81) Post an offer in public places: Bulletin boards still physically exist in many places and people still put up physical signs for all kinds of things. The stereotype are things like meetings and guitar lessons, but that doesn’t mean you can’t get attention being creative. If you know there are places your target audience will go to or pass by, consider posting something to get their attention. If you’re doing a Concierge MVP for your idea, this is a great way to start.
82) Use handouts, fliers or mailers: If hanging something up and hoping people will read it and respond doesn’t work for you, consider a more 1 to 1 communication through handouts you can give out or mail. One person I met that had a parking ticket app would carry fliers with him and put their flier under the wiper of a car that already had a parking ticket on it as well. It had a massive conversion rate. Get creative!
83) Buy someone’s service: So you want to start a business serving artists, or maybe housecleaners or some other service? Try buying their service and take a few minutes before or after their service to talk to them. If they care about customer service, they’ll be happy to discuss their problems with you. A friend of mine started his mobile invoicing startup based on the problems his cleaning lady had tracking payments.
Kickstarter & other funding sites
84) Look for products getting funded in your industry: Funding sites are booming which means all kinds of companies and ideas are getting funded. Others in your industry can be incredible sources of knowledge not just on how to run a campaign, but what they’ve learned from interacting with their new customers.
85) Ask complimentary funded projects for help: A fellow crowd-funded project that has finished their funding will be very busy trying to deliver their product to their supporters, but they might just be willing to send a message, tweet or post on your behalf. If their funding is still open, you may be able to swap promotion to your audience and theirs. Remember: You don’t get what you don’t ask for!
86) Reach out to users that backed the project: Every Kickstarter has a tab for Backers which includes their profiles, which you can click to see what else they’ve backed. While they have no messaging system (Indiegogo does), with their full names on Kickstarter, you can likely Google or search Twitter or Linkedin for them and message them there.
87) Put your idea on a funding site: If you feel you’ve validated your idea enough, then running your own crowd-funding campaign is a great way to validate interest for your idea. There is tons of information on the web about making the most of a campaign, just search on Google or Quora.
88) Talk to Youtube Channel owners: Youtube is filled with creators making content on all kinds of markets. If you go to Youtube’s channel search, you can search for your category and see who has channels and how many subscribers they reach. Just like you can talk to bloggers as experts in a market, you can learn a lot by interviewing channel owners.
89) Ask channel owners for promotion: If your idea resonates with the channel owner, there’s a good chance you can get them to talk about you on one of their episodes or maybe even have you as a guest. They may charge you a fee, but if it’s your exact target audience, it might just be worth it.
90) Start your own channel: If you think video is a great medium to communicate with your audience then creating a channel to connect with them may be a great option. Just like starting your own Meetup group, it can initially be hard, but once you’ve built an audience it will have a great, long-term payoff.
91) Run ads on Youtube: Youtube leverages Google’s ad powers to run targeted ads. You only pay for the ads people fully watch (not skip) so if video seems a powerful way to communicate with your audience, it’s worth experimenting. Remember, Dropbox started with nothing but a video and got over 75,000 signups (although they did not run it as a video ad).
Your own Product:
92) Put your name on it: If any part of your product can be seen by a non-customer, make sure your name is on it. This is easy, free marketing that your customers can provide for you simply in using your product. KISSinsights (now Qualaroo) had incredible growth without doing any paid advertising because of a simple link in each of their pop up surveys.
93) Make sharing an option for more access: If your product has metered usage, then you will always have customers who are uncomfortable moving up to a new, costlier tier. MixPanel has a free 50,000 events plan that can become a free 175,000 plan if you put their logo on your homepage.I’ve seen countless startups with that logo in their footer for just this reason, so don’t think your users won’t do it until you try.
95) Run ads in your side project apps: A number of my friends have built apps as side projects that end up having a few thousand users that never really monetized or amounted to anything. As a free user base you can always insert your own ads into your app. I met one of the founders at QBix that built the Groups App for the iPhone (helping you organize your contacts) and they used this tactic to drive people to their other apps. You can also send them to mobile landing pages to avoid building anything.
Woah…that was a lot. Thank you for making it to the end.
I hope a few of these have inspired you and point you in the right direction to find those difficult first few users. While some of them are paid options, I hope you see how many alternatives there are to paid acquisition on Day 1.
While building Greenhorn Connect, I’ve spent a great deal of my time with young and first time entrepreneurs. If there’s one thing I’ve come to appreciate, it’s the absurd odds stacked against any of us succeeding; there’s just so much that you have no idea about and need to quickly learn.
You could spend years learning just one small subsection of your duties like SEO, analytics, customer development, copywriting, design, fundraising, product development, development architecture or simply great coding, but the demands of startups says you need to become competent and relatively adept at all of those and more. Amongst all those hard skills, I didn’t even mention leadership, which I think is the most underrated skill to develop as a young entrepreneur.
Leadership is a bit different, because it’s a soft skill; it’s not as easy to measure as the success of your marketing campaign or the elegance and functionality of your code. However, it’s an immensely important skill and one with more long term value than becoming an expert in any one of the aforementioned hard skill areas; if your goal is to build a company with more than yourself as an employee, then you’re going to be leading others. As you grow, you’ll be leading more people and spending less time on any of the individual skills you used in the early days and much more on communication, vision and goal setting and coordination across teams.
As I’ve learned through my own errors and in talking to other young entrepreneurs, I’ve noticed there are 2 major concepts most of us don’t recognize that are absolutely critical to leading your team even when you only have one or two employees:
1) Your employees don’t work for you; You serve them.
Having employees means that you’ve been able to convince others to work with you on your idea. Appreciate the incredible feat that it is.
However, do not think that because they work for you that they are now enlisted to your dictatorship. You need to involve them in core discussions, listen to their ideas and feedback and cultivate a culture of appreciation and shared passion. A happy, engaged employee is 5x as productive as a frustrated, stymied or sad employee. This ebbs and flows, so you really need to watch for it on a daily basis.
Showing appreciation for those that work forwith you is not optional; you cannot over-recognize their best efforts. At the same time, it is a balancing act. There are times for the carrot and other times it is best to lead them with a stick. Each employee will respond differently, so it’s a skill that requires fine tuning for everyone you work with. Personally, as much as I love a good reward, I value constructive criticism significantly more; I’d much rather hear how I can do even better next time than dwell on what went right. Unfortunately, what I, you, or anyone else prefer is completely different than the next person you hire.
I constantly feel humbled by the fact that I have a team helping me make Greenhorn Connect a success today. I do everything I can to make sure Pardees and Ian know that and have learned well the power of having excited, motivated people helping you fulfill your vision. An hour spent cultivating your employees will pay you back exponentially.
2) Uncover and fix problems when they’re small.
With all the hustle and constant activity buzzing around a startup, it’s easy to overlook small problems. Don’t.
When problems are small, solutions are small as well. When problems grow up, then it takes big, dramatic solutions to overcome them. If it’s an interpersonal issue or a major team issue, then suddenly that small issue can lead to someone having to be let go.
Catch problems when they’re small by reading your employees; look at their face and posture, and if an employee seems down or upset…asking them if something is up and if you can help has huge immediate and long term benefits.
Conflicts and small issues are often simple misunderstandings or honest mistakes. Tackling them head on breeds a culture of accountability and openness to healthy criticism. When you get your team in this habit, it becomes much easier to avoid major problems, because they never get that big. Having a discussion about firing someone is a much more dramatic discussion than talking to an employee about a minor issue that may have caused conflict or hurt the company. Nip problems in the bud and encourage your employees to do so as well.
This post may seem like stating the obvious, but theory and practice are two very different things. Just like hard skills require practice and active use to become sharper, leadership skills like the issues above require active diligence to become adept at them. Ask yourself how your team is doing at managing these issues; I bet there’s times you’ve noticed your team’s mood affected productivity or a problem grew larger than it should have and caused trouble.
Have you learned these lessons the hard way? What key leadership skills do you think first time entrepreneurs need most?