Week 43: The unintuitive growth strategy

Last week, I found myself rereading Anything You Want—a short firsthand book about starting a company that fits your lifestyle (the whole book is free at the bottom of the page).

When I first read it a few years ago, it put the idea in my head that it was possible to break out of the venture-funded mold.

But now that I’m in the thick of running a company for the second time, it’s taken on a whole new meaning.

I want to talk this week about chapter 10: the advantage of no funding.

All you have to do is ask

The chapter is short enough that you can read it for yourself, but I want to focus on a key section towards the bottom:

If you’re ever unsure what to prioritize, just ask your customers the open-ended question, “How can I best help you now?” Then focus on satisfying those requests.

None of your customers will ask you to turn your attention to expanding. They want you to keep your attention focused on them.

It’s counterintuitive, but the way to grow your business is to focus entirely on your existing customers. Just thrill them, and they’ll tell everyone.

If you asked random founders and product managers what their growth strategy is, almost none of their answers would paraphrase this. They would say you need to look at adjacent markets, account expansion opportunities, and new compatible trends.

But over the years, I’ve come to believe this is right. If you want to grow, focus almost entirely on your existing customers.

Why does this work? There are at least two reasons.

Positive word of mouth

In Perennial Seller, Ryan Holiday opens with a discussion of the Lindy Effect: the future life expectancy of some non-perishable things, like a technology or an idea, is proportional to their current age.

In other words, the longer something has been around, the higher probability it will continue to be around.

The critical question is, of course, how do you make something popular enough to get the benefits of the Lindy Effect?

You can only do so much pushing. You can only buy so many ads, go to so many conferences, pitch so many prospects.

The key is word of mouth. It takes no effort since someone else is doing it, and it’s the strongest form of persuasion for a buyer.

If you’re talented and you focus completely on your existing customers, you’ll excite them so much that they’ll tell other people. It kicks off the most important form of marketing you can get.

Solution depth

Broadly speaking, I think there are two kinds of products: those are thought-through and feel complete, and those that feel hacked together—like someone forgot to finish them.

Pick any product. You instantly know which you are working with. I know which one I want.

How do you get a product that feels complete? You focus maniacally on solving a single problem. At first, you invent big exciting things. But over time, you work minutiae that’s a lot less exciting to talk about.

It is in the minutiae that your product achieves the feeling of polish.

I’ve now experienced this first hand. One of my first customers works heavily with geospatial data. At first, I had fun adding eye-popping functionality to make synthetic geo data. But over time, I fielded 99 more tiny requests to make everything work really well. Better defaults, support for more coordinate systems, improved error messages. Nothing worth writing home about.

As it turned out, this area of the product became so complete that it attracted another account. I did zero outbound marketing to activate them.

When I asked them why they used ShadowTraffic, they said, “It was literally exactly what we need.”