Start Small, Stay Small

by Rob Walling · 2010

Posted on 2022-09-01

A Developer Guide to Launching a Startup

Content

Book in 3 Sentences

Top 3 Quotes

Market First Approach. Opposite to Product First Approach.

  1. Market (people willing to pay is the most important)
  2. Marketing
  3. Aesthetic
  4. Functionality
  5. … but luck is the exception

Highlights

Chapter 2 – Niches Are the Name of the Game

Conversion Rate = Buy / Visit events

  • up to $50 => CR ~ 1-4%
  • $50 - $1000 => CR ~ 0.5-2%

Trafic

  • Search Engines ~ 1/3
  • Incoming Links ~ 1/3
  • Direct Trafic ~ 1/3

Test Your Idea

  • Build Mini Sales Site
    • Home Page
    • Product Tour (optional)
    • Pricing & SingUp
  • Generate trafic with AdWords
  • Track converion on “Try It” or “Buy Now” clicks
  • Inform prospects that product is in development
    • Collect e-mail

Enter Niches! Narrow Product Focus, as horizontal markets are too large and expensive for self-funded startups to navigate.

Chapter 3 – Your Product

Product Success Triangle

  • Product
  • Market
  • Execution

Path to v1.0 should be ~200-400 hours.

Get over the desire to write software yourself.

How to Price Your Product ?

  1. Know your market
    • Comparable Products
    • Replacement Value
    • Income Approach
  2. Ask yourself
    • What would I pay ?
    • What number feels right ?
  3. Look at competitors

  4. Determine your product’s value for a user

  5. Combine (steps 2-4)

  6. Lean towards higher prices

  7. Use thre tiers (with 2x multiplier)

  8. End price in 7, 8, or 9 (the same for all tiers)

  9. Determine the benefits of each tier (ensure to provide more than 2x value)

  10. Add support

  11. Alternative method for calculating recurring payments

  12. Test