Lecture 8 - How to Get Started, Doing Things that Don't Scale, Press

Introduction

In this section, Stanley Tang introduces himself and DoorDash. He shares a photo that summarizes the journey of DoorDash from its inception to raising $15 million in funding.

• Stanley Tang is the founder of DoorDash.

• DoorDash is an on-demand delivery network for local cities.

• The idea for DoorDash came from Chloe, the owner of Chantal Guillon, a macaron store in Palo Alto who had problems with delivery.

• Stanley and his co-founder Andy graduated from Stanford University in 2014 with degrees in Computer Science.

The Beginning

In this section, Stanley talks about how he got the idea for DoorDash while interviewing Chloe, the owner of Chantal Guillon. He also discusses how they tested their hypothesis by creating a simple experiment with restaurant delivery.

• During his junior year at Stanford, Stanley interviewed Chloe to get feedback on a product prototype they were working on.

• Chloe brought up the problem of delivery and showed pages of delivery orders she had to turn down due to lack of drivers.

• Over the next few weeks, Stanley talked to around 150-200 small business owners who agreed that delivery was a big problem for them.

• They wondered why no one had solved this problem before and decided to test their hypothesis by creating a simple experiment with restaurant delivery.

• They created a landing page called PaloAltoDelivery.com with PDF menus of restaurants in Palo Alto and their personal phone number at the bottom.

• They received their first order soon after launching the landing page and decided to deliver it themselves to learn more about how delivery works.

Testing Consumer Demand

In this section, Stanley talks about how they tested consumer demand for their service by manually fulfilling orders themselves.

• After receiving their first order, they decided to fulfill it themselves to learn more about how delivery works.

• They continued fulfilling orders manually and learned a lot about the delivery process.

• They received positive feedback from customers and realized that there was a demand for their service.

• They started recruiting drivers and expanded their service to other cities.

Conclusion

In this section, Stanley concludes his talk by discussing the challenges they faced while building DoorDash and the lessons he learned along the way.

• Building DoorDash was not easy, and they faced many challenges along the way.

• One of their biggest challenges was recruiting drivers, but they were able to overcome this by offering incentives such as guaranteed hourly pay.

• Another challenge was scaling their operations, but they were able to do this by leveraging technology and data analytics.

• Stanley learned many valuable lessons while building DoorDash, including the importance of perseverance, focus, and teamwork.

Palo Alto Delivery: Starting a Business in One Hour

In this section, the speaker talks about how they started their business, Palo Alto Delivery, in just one hour and how they hacked together solutions to get it off the ground.

Launching the Business

• Within days of launching their landing page, paloaltodelivery.com, they started receiving phone calls for orders.

• Despite having an unprofessional-looking website that required customers to look up PDF menus and call in orders, people were still willing to place orders.

• They launched the business within an hour without any drivers or algorithms. At the beginning stages of a business, testing ideas is more important than having all the necessary systems in place.

Doing Things That Don't Scale

• The founders did everything themselves at first, including delivering food and providing customer support. This allowed them to become experts in their own business.

• They used Square to charge customers and Google Docs to keep track of orders since they didn't have a dispatch system yet. They also used Apple's Find My Friends app to track drivers' locations.

• Doing things that don't scale helped them understand different aspects of their business such as delivery processes and customer support. For example, they manually emailed every new customer for feedback.

Hacking Together Solutions

• Since they were growing so fast with small orders coming in rapidly through Square payments, Square shut down their account under suspicion of money laundering. Luckily, one of the co-founders worked at Square and was able to resolve the issue quickly.

• By hacking together solutions like using Google Docs and Find My Friends app, they were able to get their business off the ground without spending months building a fancy dispatch system.

Starting DoorDash

In this section, the speaker talks about how they started DoorDash and what they learned from it.

Lessons Learned

• Test your hypothesis by treating startup ideas like experiments.

• Launch fast to find product-market fit.

• Do things that don't scale to gain a competitive advantage when starting out.

First Customer and Word of Mouth

In this section, the speaker talks about how their first customer found them and how word of mouth helped grow their business.

First Customer and Marketing

• The first customer found them through PaloAltodelivery.com, which was launched without any marketing.

• They did barely any marketing at the beginning, relying mostly on word of mouth.

Validation Through Word of Mouth

• Word of mouth validated the strong need for their service.

• People were willing to put up with terrible user experience and design because they needed the service so badly.

Mobile as a Competitive Advantage

In this section, the speaker talks about how mobile technology was a key insight that gave DoorDash a competitive advantage.

Mobile Technology Insight

• Mobile technology was a key insight that allowed DoorDash to design a delivery system based entirely on mobile devices.

• They tapped into an on-demand pool of independent contractors instead of hiring drivers full-time or purchasing vehicles.

Experimenting with Delivery

In this section, the speaker talks about how logistics and transportation were always passions for them and how experimenting led to the creation of DoorDash.

Passion for Logistics and Transportation

• Logistics and transportation were always passions for the DoorDash team.

• The delivery service came out of an experiment with a landing page that took off unexpectedly.

Standing Out in a Competitive Space

In this section, the speaker talks about how DoorDash stands out in a competitive space.

Finding a Need

• Consumer demand has never been the problem for DoorDash.

• At the beginning, competition doesn't really matter when you're getting started.

Future Plans Beyond Food Delivery

In this section, the speaker talks about future plans beyond food delivery.

Helping Small Business Owners

• DoorDash was always about helping small business owners with delivery.

Long-term Vision and Focus

The speaker talks about the long-term vision of the company and how they are currently focused on rush delivery to scale.

Long-term Vision

• The long-term vision is still the focus of the company.

• Rush delivery is being used as a way to scale for now.

• The ultimate goal is to end up with the long-term vision.

Introduction of Walker Williams from Teespring

The speaker introduces Walker Williams from Teespring, who will talk about doing things non-scale.

Introduction of Speaker

• Walker Williams from Teespring is introduced.

• He will talk about doing things non-scale.

Doing Things That Don't Scale

The speaker talks about the advantages startups have in doing things that don't scale, and focuses on finding first users, turning them into champions, and finding product-market fit.

Advantages of Doing Things That Don't Scale

• Startups have an advantage in doing things that don't scale.

• These are growth strategies that won't take you to a million users.

• Three areas where this applies: finding first users, turning them into champions, and finding product-market fit.

Finding First Users

• There is no silver bullet for user acquisition.

• Founders need to spend personal time and effort to bring in their first users themselves.

• It's your responsibility as a founder to do whatever it takes to bring in your first users.

• ROI should not be expected in terms of time spent.

Turning Users into Champions

• Once you have your first users, turn them into champions by providing excellent customer service and support.

• Word-of-mouth marketing can be very effective at this stage.

Finding Product-Market Fit

• This involves understanding what your customers want and need, and how your product can meet those needs.

• It's important to iterate quickly and make changes based on customer feedback.

• This process takes time and effort, but is essential for long-term success.

Building a Product Users Value

In this section, the speaker discusses the importance of creating a product that users value and how to turn users into champions.

Creating a Valuable Product

• Cutting costs or giving away products is an unsustainable strategy.

• Users treat free products differently than paid products, which can give a false sense of security.

• It's important to ensure that users value your product.

Turning Users into Champions

• A champion is a user who talks about and advocates for your product.

• Every company with a great growth strategy has users who are champions.

• Delight users with an exceptional experience to turn them into champions.

• Talking to users constantly is crucial in building champions.

The Importance of Talking to Users

In this section, the speaker emphasizes the importance of talking to customers and provides three ways to do so effectively.

Three Ways to Talk to Customers

1. Run customer service yourself

• Even though it's painful, it's important to learn what you need to build or fix.

2. Proactively reach out to current and churned customers

• Make sure customers have a consistent good experience and find out why they left if they churned.

3. Use social media and communities

• Know how people are talking about your brand and make things right when someone has had a bad experience.

Making Things Right for Customers

In this section, the speaker stresses the importance of making things right for customers even when problems arise.

Making Things Right

• Problems are inevitable in startups, but it's important always to make things right for customers.

• One detractor who has had a terrible experience on your platform is enough to reverse the progress of ten champions.

• It's crucial to go the extra mile and make customers happy, even if it means fixing massive orders or addressing negative feedback on social media.

Introduction

In this section, the speaker talks about how customers who are initially frustrated can become long-term users and champions of a product.

Customers as Champions

• Frustrated customers can turn into long-term users and champions of a product.

Finding Product-Market Fit

In this section, the speaker discusses finding product-market fit and iterating quickly to reach it.

Iterating Quickly

• The product launched will almost certainly not be the one that takes a startup to scale.

• Progress and iterate as fast as possible to reach the product that has market fit.

• Optimize for speed over scalability and clean code in the early days of a startup.

Building Features for Enterprise Customers

• When enterprise customers requested features that were missing from their service, they duplicated the code base and database to build a completely different product.

• This allowed them to serve these enterprise customers without worrying about existing users.

• They eventually integrated these features into their core product after learning which ones were core.

Only Worry About Next Order of Magnitude

• A great rule of thumb is to only worry about the next order of magnitude.

• When you have your tenth user, you shouldn't be wondering how you're going to serve a million users; you should be worried about how you're going to get to 100.

Doing Things That Don't Scale

In this section, the speaker emphasizes doing things that don't scale for as long as possible.

Advantages of Doing Things That Don't Scale

• Doing things that don't scale is one of your biggest advantages as a company.

• As long as it is a net positive, you need to be spending time talking to your users and moving fast in development.

Don't Give Up Doing Things That Don't Scale

• The moment you give up doing things that don't scale, you're giving your competitors that are smaller and can still do things that advantage over you.

• As long as humanly possible, as long as it is a net positive, don't give up doing things that don't scale.

Conclusion

In this section, the speaker concludes by offering his email address for questions and promoting an official how-to-start-a-startup tee with proceeds going to Watsi.

Contact Information

• The speaker offers his email address for questions about Teespring or starting a startup.

Official Tee

• An official how-to-start-a-startup tee with Sam has been created with all proceeds going to Watsi.

• To purchase the tee, go to teespring.com/startup.

Starting a Business with Pain Points

In this section, the speaker talks about how great ideas often start by looking like silly ideas. He explains that it is important to identify pain points and market fit before launching a business.

Identifying Pain Points

• The speaker launched Teespring because he ran into a personal pain point where he had a need and looked at the current solutions.

• He realized that nothing matched his needs, so he knew there was market fit.

• People were adopting the product quickly, and the pain point was clearly there.

Market Fit

• Great ideas often start by looking like silly ideas.

• You can feel out whether or not there's a scalable business here by how people are adopting it.

• It's possible to bring customers aboard, but non-profits are not your biggest customer base.

How to Get Press for Your Startup

In this section, the speaker talks about press and how to get it. He emphasizes that before thinking about press, you should think about who you want to reach and what your actual goal is.

Setting Goals for Press Coverage

• Before thinking about press, think about who you want to reach and what your actual goal is.

• If you aimlessly want to be covered in the news without any goals, it's not really going to do anything for your startup.

• There are many different goals for press coverage such as being known as a video Instagram app or getting customers in San Francisco.

Targeting Specific Press Outlets

• Getting in the news is nice because you can send it to your mom or say hey I have a real job.

• But if you don't have an actual goal for your business with it, it's really just not a good use of time.

• Target specific press outlets that will directly talk to people who could potentially use your app.

How to Get Press Coverage for Your Startup

In this section, the speaker discusses how to get press coverage for your startup. She talks about different types of stories that can be covered by the press and what makes a story interesting.

Types of Stories That Can Be Covered by the Press

• Product launches, fundraising, milestones or metrics, business stories, stunts, hiring announcements, and contributed articles are all types of stories that can be covered by the press.

• Stunts are interesting because they catch people's attention and get them talking about your company.

• Hiring announcements can also be newsworthy if you hire someone important.

• Contributed articles are another way to get your company in the news.

What Makes a Story Interesting?

• You need to think objectively about whether someone who is not involved with your company would find your story interesting.

• Incremental feature releases may not be interesting unless they are truly innovative.

• Journalists and bloggers want to write about things that people actually want to read.

• Your story doesn't have to be completely original but it should be novel enough that it hasn't been written about extensively before.

Mechanics of Getting a Story

• Getting press coverage is like a sales funnel - you will talk to many people but not all of them will convert.

• To get press coverage:

• Find journalists who cover your industry

• Build relationships with them

• Pitch them stories that they will find interesting

How to Get Press Coverage for Your Startup

In this video, Justin Kan shares his insights on how to get press coverage for your startup. He provides a step-by-step guide on how to approach reporters and pitch your story.

Getting Introduced to Reporters

• The best way to get in touch with reporters is through someone they already know.

• Entrepreneurs who have been covered by the reporter you want to reach out to can introduce you.

• This is beneficial because entrepreneurs are doing the reporter a favor by introducing them to an interesting story.

Building a Relationship with Reporters

• Once you have an introduction, give yourself enough lead time before pitching your story.

• Try to get a face-to-face meeting or phone call with the reporter instead of just emailing them.

• Prepare bullet points outlining your ideal story and memorize them so that you can control the conversation during the pitch.

Following Up with Reporters

• Follow up with reporters a few days before launching your product or news.

• Send an email reminding them of the launch date and time.

Overall, Justin Kan emphasizes building relationships with reporters through introductions from entrepreneurs and preparing well-crafted pitches. He also stresses the importance of following up with reporters before launching your product or news.

Getting Press and PR Firms

In this section, the speaker talks about getting press for your startup and whether or not to hire a PR firm.

Doing it Yourself

• It's recommended to try getting press yourself before hiring a PR firm.

• Tech press and bloggers are always looking for new things to write about, making it easy to get started.

Limitations of PR Firms

• PR firms can only help with contacts and logistics, not what's interesting about your company.

• They are expensive, costing between $5,000-$20,000 per month which is generally not a good use of money for startups in the early days.

Importance of Press

• Getting press is a lot of work so make sure it's worth it as it doesn't necessarily mean success.

• Press can be a good strategy for getting your first 1000 customers but isn't scalable user acquisition strategy.

Building Relationships with Reporters

• Establishing relationships with reporters over time can be helpful in breaking news and getting your side of the story out if negative articles are written about you later on.

• Helping fellow entrepreneurs get press is important as well as paying it forward really applies here.

Tips for Getting Press Coverage

In this section, the speaker talks about how getting press coverage can help startups find interesting stories and get leads back from entrepreneurs. The speaker recommends two resources for learning more about press: a book by Jason Kincaid and a book called Trust Me, I'm Lying.

Resources for Learning About Press

• Reporters like helping startups find interesting stories.

• Jason Kincaid's book provides a great overview of getting press coverage.

• Trust Me, I'm Lying is an "evil" resource that discusses how to manipulate the press but also provides insight into how stories spread on the internet.

When to Start Worrying About Press Coverage

In this section, the speaker answers a question about when startups should start worrying about press coverage. The speaker suggests that it's good to get one TechCrunch story to get some users and practice, but not to obsess over getting coverage in multiple outlets in the beginning.

When to Start Worrying About Press Coverage

• It's good to get one TechCrunch story when launching a product to get some users and practice.

• Don't obsess over getting coverage in multiple outlets in the beginning.

How Twitch Plays Pokemon Got Press Coverage

In this section, the speaker talks about how Twitch Plays Pokemon got press coverage. The community originated the idea, but the company helped give it legs by making itself available to talk to reporters and suggesting follow-up stories.

How Twitch Plays Pokemon Got Press Coverage

• Twitch Plays Pokemon was a huge news story that the community originated.

• The company set the stage by having other news stories that provided context for Twitch Plays Pokemon.

• The company helped give the story legs by making itself available to talk to reporters and suggesting follow-up stories.