Brian Armstrong's first Coinbase product, a Bitcoin wallet, flopped because users didn't actually own bitcoin. Y Combinator told him to call inactive sign-ups. He learned what was missing, built a buy button, and growth took off.
Questions this video answers
A hosted Bitcoin wallet that Brian posted on Reddit.
About 10 people.
A buy button to let users purchase bitcoin (integrated via bank partnerships and money-transmission licensing).
Chapters
The first version of a product you put out, it doesn't work. In fact, that's the only thing I've ever seen happen in startups. I've never seen a startup that the very first version of their product actually worked. Sometimes in hindsight, people like to tell that story, but I think in reality, it's very rare. So for us, or for the first version was this hosted Bitcoin wallet I posted on Reddit. Some people would sign up, but nobody would stick around and use the product. So in Y Combinator, they teach you this great thing, which is don't spend your time going to conferences and, like, trying to raise money. It's like, if you don't have product market fit yet, talk to your customers and then improve the product based on their feedback. And then talk to your customers and improve the product. Talk to customers, improve the product. There's really only two things you should be doing in the early stage. Talking to your customers and improving the product. Sounds like simple advice, but people spend so much time doing other stuff that's actually not real work. So taking this Advice, I emailed 10 of the people or so who had signed up for the product and never come back. And I said, hey, I created this app, like, I'd love to get on the phone with you and just talk to you about it for a minute. So I remember I got on the phone with some of these people. One of them was like, I kind of like it, but I don't have any bitcoin. So I just didn't come back. And I remember thinking, well, if there had been an easy way to get bitcoin into your wallet, like a buy button or something, like, would you have stuck around and used it? He's like, yeah, probably. And so I was like, okay, let me go try to make a simple buy button so when people sign up, they can actually get some bitcoin into their wallet. And it turned out that was a very hard thing to do. You had to get these bank partnerships, I had to figure out money transmission licenses. But the minute that we launched that buy button, it started to grow every day organically, with no marketing or anything. And that was the minute I felt like we finally had product market fit.