Strategy is how you win in startups [feat. Jason Cohen]

All right, Jason. Here we are. Here we are. Second time. Yeah. Right? Clearly you don't hate me enough.

Clearly. The hate meter is not high enough. We'll see if we can change that this time.

This could be two and done, as they say. If we don't have the third one in a row, then I'll know that you truly. In a row. Yeah, in a row. Anyway, Jason, such a pleasure.

Same.

Such an honor to you know share the stage with you. Be here in your. I feel like this is kind of like.

It's my hometown.

Yeah. Every fourth guy here. is like, oh my God, Jason Cohen's here. Oh my God. So this is—

Also, I was born here, so it's literally my hometown.

Literally your hometown. Shout out to folks from Austin. The tech scene that I'm seeing through conversations with some of the locals in the last 10 years has grown significantly better and bigger. And I feel like somehow the vibe that I'm getting is it's still very community-centered. What's your reading in the last 15 years, 20 years of how the tech scene has evolved.

Yeah, that's right. And sometimes people from California say, oh, Austin could be the next Silicon Valley. And I always think, no, Silicon Valley is the Silicon Valley and no one else should try to be the next Silicon Valley. It will be their thing. Austin's got a thing. Austin's thing is people help each other. It's very community-oriented. People are always like encouraging to each other, introducing them to their angel investors. and sharing things. And I think in the Valley there's a whole lot of sharing too. Yes. But the Valley is very much like either you're building the next Facebook or we don't care.

Yeah, ambition.

And they use pejoratives like a lifestyle business as if living in San Francisco's not a lifestyle. No, right? It absolutely is. Yes. And so, but in Austin that's not the case. And so, you know, whether it's like, oh yeah, I'm a one-person consultant doing this and that, or, you know, I'm trying to do a bootstrap thing, or yes, I'm trying to build a big thing, those are all equally interesting, I think, inside the Austin ecosystem. And I think that's a good thing.

Yeah, yeah. Well, I actually jumped the gun and I didn't do proper intros, but I feel like we can just do one line of 30-second intros. I think it would be helpful for anybody listening right now or later. Hello everybody, I'm KP. I am the founder relations manager at Paddle right now, but I've been a 4-time founder, bootstrapped. That's why I look up to Jason as a legend in the bootstrapping space. His talk, I'm kind of blending my intro and his intro. He gave a phenomenal talk at MicroConf, I think in 2013, still considered to be one of the best talks for anyone in Bootstrap space, without a question. In fact, I have proof for this. If we go to MicroConf's YouTube page, it has, I think, 400,000 views or something. It's the most viewed YouTube video and it's uploaded like 4 years ago. It's not even like from 2013, so it's crazy.

It just shows how we can't be content creators. You know, like, you know, Levy Rozman posts about chess and he gets 4 million views and it's chess, you know. This is like the best talk of all time about it, it's 400,000 views. I mean, but it's cumulative over 11 years.

But I think the audience, a lot of them are, in my view, high quality and like doers and decision makers and like, you know, folks like Jason over there. And so anyway, so back to the intros part. My main focus now is running an AI program for founders around the world called AI Launchpad at Paddle. It's like a 6-week accelerator program. We're really stoked about it. We have about 128 startups. We have a couple from Austin too joining the cohort, but we're excited here. It's my first time in Austin and it's first time at SaaStock. So the next 25, 30 minutes, I'm gonna do my best to unpack lessons and wisdom from Jason, both from a bootstrapped founder point of view, but also I think generally about company strategy. And as you grow and scale, what are some things to keep out for in terms of strategy and how you win as you get bigger and bigger? I think the definition changes based on where you are at the stage. So that's something we're gonna learn today. Super excited. Jason, in 30 seconds, how would you introduce yourself?

I've done 4 startups. They all started bootstrapped. Some of them raised money. All of them made millions in revenue. 2 of them were sold. 2 of them are currently unicorns.

Yeah. And you're at WP Engine, which is like a, again, local legend, legendary company in Austin. And you guys have like, what, 1,200 employees or something? It's pretty big now, right? Yeah. That's awesome. Now your official role is Chief Innovation Officer, but you started the company.

Yeah.

Right? Yeah. Awesome. So let's get into the strategy part. So how would you describe I guess the word, the thought that comes to my mind when I think of strategy is such a fluffy and loaded word.

Yeah, for sure.

As a founder.

Yeah.

And so I'm curious about how you approach that concept early on, like let's say 10 years ago when you were just getting this off the ground, WP Engine, and walk us through some inflection points where you evolve the definition of what strategy means. For the company?

So, I mean, to me, strategy means how you'll win. You might even say why you have the right to win. You could say it that way. Some people do. Roger L. Martin famously, right to win, where to play, that kind of thing. To me, either a common definition of strategy comes from academia and then they see things like SWOTs and all these kind of things. I think that's all fairly nonsensical. I don't know anyone who's ever done a SWOT and gotten real insights and then referred to it later. Like a year later, we still look at our SWOT and use it to make decisions. Like, what? No, you don't. So I feel like the word strategy is caught up in these various things that I agree are not that helpful. It's certainly not great strategy. But I think when you think about companies that succeeded and you ask why, post facto, there's always these really clear things. Like, yeah, Netflix, they just knew people didn't want to do that. That droning walk through a store.

Right.

Wait, that's it? Yeah, that was it. Well, then later they realized streaming's better. And so it was really hard, but, and they could have been too early, but they weren't. And that's it? Yes, that is it. Now there's so much more to it than that, obviously. But you can, in fact, you know, Twitter, it was just the headlines and turns out people want, not the post, and turns out people wanted that. Like, why is it that we can, do that. So it is something about strategy that's, if you can distill it into like, there are these couple of things that are either the key insight or thing, or why it's you and not someone else. You know, there's these different ways you could go about it, which of course I have lots of ideas about, about what goes into it.

Right.

And of course, beforehand, it's quite hard to say what it is. That's, of course it is. But what it does is demonstrate there is just a couple of important things that explains everything. And so to me, the point of strategy is, can we identify what those are? Maybe ahead of time so we can work on just that because that's how we're going to win.

Do you source that from customer conversations or is it more like macro trends and just observations of—

It has to integrate. So one of the things about strategy is it does integrate lots of different things and that's part of why it's complex and not just like, oh, you just follow this little 7-step format and you have a strategy. Like, of course it's not like that. It is a complex domain thing. That's part of why it's hard. So for example, Obviously, if the market doesn't exist and people don't want it, it's not a good strategy. But it's not only that. Of course, you have to talk to customers and find out how do they buy and when and why do they do the current thing they do? Is that some vendor or they do it themselves? And like trying to understand like what is it that we're doing that actually matters? Of course, if you don't know what that is, it's not a good strategy. Right. But another example is just looking inward. Forget the market and customers whatsoever. What do you have? What can you do? That's special. Not necessarily unique. Unique's better.

Right.

Unique's better. But never mind that. Just, do you have any strengths? Like, if you're great at design and terrible at details, I already can tell what kinds of products you should make that you'll be good at

and

what kinds of products you should not attempt because you're just bad at that. It's not hitting a strength. It's just that that's a bad idea. So you have to be introspective too. Where am I strong? What assets do I have? materials, maybe I have relationships, maybe I have past experiences, maybe I have certain talents. If the company has moved on a little bit, I have these customers that I can leverage by asking them questions and doing stuff with them. Or I have marketing channels that work that I can put another product in. Like, you know, once the company's going, you have more assets and capabilities that you've built up. So these introspective things, which have nothing to do with the customer or the market, they're important too, right?

Right.

So this is what I mean. There are these different pieces. A good strategy, of course, is going to have to let— all of these things will have to be true for this. It will have to be leveraged for the strategy to be good. You say, well, that sounds hard. Yeah, I know. It's not easy. It's complex. But here in strategy, you're like, how does this synthesize into something that makes sense for us? That's where you're actually doing something important. Right. Because in the everyday actions of people in product and engineering and doing sales, doing marketing, doing even finance, They can't be wrestling with this complexity in their everyday life. Like, that's not the right time to do it. So some kind of strategy work is the right time to tackle it, which you do periodically, not just once. But that's the right time to tackle this. Like, oh, how do we— and then when you get these and you distill them down, then everyone's like, then that's what we're doing. And we can change our minds. But for now, that's what we're doing. We're not relitigating that.

Right.

By putting all of our efforts into like these 3 things, that's how we're going to win.

And then you align the whole team around that strategy.

Because obviously, if everyone's running very fast but in different directions, you're going nowhere. They have to be running fast in the same direction. And strategy ultimately is saying what direction that is.

I'm also sensing the strategy and taking a stance like that requires a sense of both a bet, but also a sense of conviction.

Yes.

For a while.

It is.

At least for a decent amount of time before you're proven right.

Or wrong, or you never prove.

Or wrong, yeah, or you have to prove it. Never. Yeah.

Yes, they're convictions. And so ideally the convictions are backed up with some kind of data. But often there isn't data or the data is confusing or the data is incomplete. So it does often come down to conviction. And the earlier the company is, the more conviction it probably is. That's okay.

Yeah. As you reflect on your career, have there been some instances that come to mind where you You had to take a bet. Oh yeah, you always do.

If you're a new company, you got no customers, that's all you're doing is taking a bunch of bets. What else are you doing?

Yeah, it just comes with the territory.

Yeah, of course. Now I would say there are tactical bets, like, which I call more like an experiment. I do it, I run an A/B test in AdWords. Of course, you're never going to stop doing that. It's also tactics that are not that interesting to talk about. Like, you should do it, of course. So strategic bets are ones in which you're making a decision to not do something and then to do something.

Yeah.

Where that this is not important and we're gonna ignore it and this is important. We're gonna like dig in and focus whatever we're gonna do. Because if you're wrong, like the whole, it doesn't matter how your A/B tests go. That's how you know it's an important decision. But again, if you don't do that and write them down, then nobody knows what to do and not do, like in their daily work. Every idea seems like a pretty good idea to implement for a feature, let's say. Unless you have these decisions of, that is a good idea if that were our strategy. That would be a good feature idea. Some people do want that feature, in fact. So the strategy, with a good strategy, you're like, or a clear one, let's say, you're like, oh no, it's still, it's a good idea, but not for us.

Yeah.

For some other product, some other company with some other goals, some other, you know. But that's not for us. And so now, you know, they're not good enough. We need better ideas that are good enough in the direction that we're trying to go.

And also the power of saying no to that, because I think having that clear strategy will allow you to say no frequently and easily.

So a simple example is like really honing in on your target market, which everybody says, okay, we all get it. But it's, of course, it's part of it. It's saying who best for who. Who do we serve? This product is best for whom? Like, that's the only thing. And any product's the best product if you have a sufficiently small for whom.

Yeah.

So that's really important to say what it is. When you do, like a classic example is you're selling to say small business and mid-market because you're a new company, your product doesn't do very much. So only people with simple needs can use it. It's very common. It's not the only thing, it's just, it's common. All right, so then it turns out people at Google use it, people at Microsoft use it, people, right? Why? Because there's some team that use it for some side thing, not because Google wants it.

The whole—

Google does not want it. Right, right. But that's not what you think. You're like, ooh, Google, maybe we should be selling to Google. Oh, I talked to someone at Google and they say they need us to be SOC 2 compliant and blah, blah, blah. So let's go do that because clearly Google wants it because there they are. This is a very common path, but that's not your target market. It's not your strategy. You'd be wrong to go off and do SOC 2, right? You'd be correct to say, look, if some team at any company wants to use it, they're welcome to, but I'm not going to get confused and think that that's my target customer. It's not. So with a clear target market, which is part of what your strategy is for whom, Right, exactly. You know, it's easy to say no to do SOC 2, for example, like just to take it to a really specific point.

Right, right, yeah, yeah, yeah, no, that's fair.

But these things happen all the time. Like you could see it on Twitter even, indie hackers who have, you know, $700 in MRR saying like, I think I need to go upmarket. Yeah. Oh my God. But this explains why not.

Is there a transition sign that you can sort of look for where you feel like, okay, maybe now I can go upmarket? Yes. Yeah, okay, I'm curious. What are some signals and signs?

So first of all, you need to have hit product market fit in your current product before you're like, I'm going to change something big, like totally change my segment or a second product or one of these kinds of big changes.

I got to follow up there. Can I ask you to describe your definition of PMF? Because I feel like everyone, I could take a survey and there's 700 people and 700 definitions of PMF. That's right.

What is yours?

I mean, you have an article too, but please. I do, I do. So there's an article.

asmartbear.com and you can search for PMF. And that's true. Okay, so that's my one plug. I don't run ads or anything, so the plug isn't so bad. You know, it's just pure ego.

First of all, it's great.

It's pure ego.

There's no other reason. Also, every week or so, because we both follow each other on Twitter, somebody discovers your blog and they're like, oh my God, it's the best thing ever. I appreciate that. It's the best well-kept secret. I'm not bullshitting.

Well, I hope it's not. I don't want it to be a secret.

There's always some guy saying that. I'm like, oh, you know, he's late.

But anyway, so the answer to the question. PMF. Yeah, you're right. I do have the article about it with data. Like what's nice about it is I have a whole bunch of charts about it.

Right, yeah, yeah. To try to justify what I'm actually saying.

So first, the qualitative thing is that it switches from, it's really hard, it's a hard scrabble to get a new customer. Like, oh, it's so hard. I got to get on the phone. Oh, we got a customer today. Yay. It goes from that where it's hard to get it to like they just coming in and you're like, oh my God, what do we do? I don't even know where they're coming from. Oh my God, support is getting crushed because of all the questions. Maybe we need to fix that in our product, whatever that is. It's great. Oh my God, you know, we're getting all these requests. People are going to Twitter saying that we suck because I heard they're good, but like I tried it and— Because I'm just getting crushed. That qualitatively is product market fit. Quantitatively, I think it's that growth takes a bend and this is where I have a lot of charts, but it goes from like, we're growing, it's fine. And all of a sudden, holy crap, what the hell? In just absolute numbers, never mind percentages. I don't care what the percents are. It goes from like whatever to whatever. Oh my gosh. But you can see it doing this. And I have lots of examples of every kind. Bootstrap companies, VC-funded companies, you know, B2B, B2C, content creators with their newsletters, like all kinds of stuff look like this. Yeah. Like it changes, like that's growth in a growth sense. That's part of the thing. Another one is cancellation rate is low. I define low as below 4% for D2C, below 3% for B2B, below 1% for enterprise, but you're probably not enterprise.

Yeah.

So you can define however you want. But the reason is not just because cancellation means your growth rate is curved, but the real reason is High cancellation means your customers are saying, I don't actually want this. That's what it is. They're like, nah, that's right. So if your cancellation rate is 10% a month, even 7% a month, not only will your growth tap out, that's just math as well, which it shows in the articles too. But it means that like within a year, a year, most customers have decided, no, this isn't what I wanted. And if you think about it, they Found you. How did that happen? That was a one in a million, right? And then they came to the homepage. They were hooked. Amazing. That's like one in a hundred. Yeah, it's pretty good, you know. And they went and they bought the pricing page. They're like, I still want it. What? They walk through that wall of fire with a credit card. They're here. This is amazing. This is like, you know, the one in a million smashes in the electron collider, right? Where they actually record the data. This is incredible. And then they actually see the product and they go, yeah, no,

I'm good.

They do the California no, which is yeah, no.

Yeah, no.

Yeah. You know, and the California yes is no, yeah. Anyway, it's like, what? Something is not right, but you're right there. Like, you're so close. So like, it's not like it's a failure. Hell no, it's not a failure. Look, this is great, but like, you are not there yet because they're saying no.

Yeah.

After they actually see the product.

You're close to failure, but you're not there.

Yeah, like, you're doing great. Don't worry about it. But like, you're not quite there yet for me. So these are some of the qualitative things that I think that in that article I back up with data. So that's what I mean. So if your first product hasn't hit that yet, the last thing you need to be doing is going and expanding, quote unquote.

To different games, different markets.

This isn't working yet. I mean, this is a very rough definition of working, of course, I know. But it's not working yet. So, you know, you can be rushing off changing the rules. You're not doing this well. Why do you think you can do a second thing well? Especially you haven't hired anybody, so you can't invest in the second thing.

Right.

'Cause it also takes that. It could be just one team, but it could be a lot more. Yeah. Like at WP Engine, when we went from small to mid-sized businesses into the enterprise, which we did, we were already at 80, 90 people. And when we invested in that, it was like we had whole sales teams just for enterprise and whole marketing stuff just for that. We started having special things in support like account management and more human beings to work on stuff and engineering. Like we invested millions, maybe tens of millions of dollars in that effort. And we had reasons for doing that and then we were successful, but that wasn't until way past all this kind of stuff was happening.

It's almost like going back to the original point around like, you should feel the right to win. You should almost feel it and then take

the— Exactly. Right. So your first question before was PMF is like, how do you know when it's time to expand? So first of all, you're after PMF. Okay, fine. Right. Then what? Right. So when you first hit that—

I feel like this is worth reiterating one more time. If you don't have PMF, don't do anything else.

Yeah, yeah, yeah, just get that,

yeah. I feel like that is

a— You're not failing, don't worry about it, but just like do that.

But that is almost a tattoo that every founder and every product marketer needs. If you don't have PMF yet, quantitatively or qualitatively, do not do anything else. Nothing matters, no other markets, none of the other stuff.

Yeah, yeah, yeah, stop that. Just get PMF first. And you may need to pivot or shuffle around. Yeah, exactly, that's what you're doing is you're seeking what will actually work.

I see that. Would you say the flexibility in that pursuit is important?

Yes, for sure. Because your first idea will never be right.

Yeah.

Okay. It may be directionally right, it may not. Yeah. It may be— certainly it'll be right in some ways, for sure. But you don't know which ways. Yeah, yeah. It'll be wrong in some ways. Okay. So you have to have that open mind, right?

Absolutely. Yeah.

And it's hard because you have a vision and you have your style and you have your thing.

You have some conviction too. A little bit like, this should work.

And if you don't, if you're not— this is, of course, a difficult thing to solve and it's not a formula. But if you don't honor that thing that is you, that is who you are and why you're You know, maybe I should say why you're doing that. You might be doing it for making money, but part of the purpose of doing this is not just getting a job, right? If you give that up, it's just pandering.

Yeah.

And I don't know, you're just like, you're, you're, it's not you even.

Yeah.

So you can't quite give it up, you know? But you also will always be the starving artist if you never care what people will buy.

And there's still a lot of people.

And so if you want to make a business, if you want to be an artist, be an artist. That's, that's awesome. But if you're saying you want to make a business, okay, well then people have to buy it. Sorry. I

think it's the intersection of the 2 circles though. But it's hard to know. what the market slash an ICP is wanting from you and what you are driven and so inspired to do and create.

So it's hard to know what is that essence of me where if I give it up, I don't know why I'm even doing this versus like, oh, this is, I have to do this. What's that balance?

How do you like walk through that path?

Yeah, again, there's no formula. So let's just get that out of the way. I would say there's a word we use it in our culture at WP Engine. One of our cultural values is do the right thing. And we define it as when it's right for the company and right for the customer and you're proud of your decision, then you're doing the right thing. This word proud is interesting because it sounds completely subjective.

Yeah.

But it isn't. Just think about it. When you're doing something, when you made a choice, and if you stop and wait and say, like, am I proud of this? You actually can answer like that, complete certainty. Yeah. It's not actually subjective. I mean, You could say subjective, 2 people could disagree.

Right, right, right.

Okay, yes. What I mean is for yourself, it's completely known.

You can tell.

Let's say that. It's completely known. And so you can say, I'm not going to do things I'm not proud of. And that does help you, even though you can't necessarily define that till after the fact. Fair enough. Because again, it's hard to define it. But you can know this twist, I'll get more sales and I'm proud of that. And this twist, it's like I just, I wouldn't be proud of telling. I don't want

to

tell my spouse. I wouldn't tell my mom. I kind of feel it's wrong. You just know it. So I actually feel like pride is an interesting north star for that.

So that keeps you in the game, keeps you like still that circle of like drive and inspiration.

Yeah, how am I seeking what the market wants but staying true to something?

Yeah.

Without that, I don't know what I'm doing. Right.

So this is sort of the, not formula, but like the pathway to walk.

It's a path.

A path to BMF. Let's say you have it now. Now you're inundated.

Yeah. So the first thing that happens is you have to deal with it. So what that means is you don't have enough human beings. There's not enough time in the day. So first you have to deal with that. So like Adobe Connect, I would say was at least a year before we were like on top of the support queues, maybe 18 months. It's hard to remember. It was a while ago. This is like 12 years ago. Yeah. Then we hit it. Then that happened. So it's hard to remember. But anyway, and so because you're behind and then you're like, we gotta hire, we can because we have revenue.

Right.

But hiring means you're recruiting, you're finding people. It's tough, yeah. And that's a new thing you haven't done before really because you haven't. And yeah, and then you're interviewing and then they're here. And how do you train a lot of people? You don't because you have no training materials. Like, I don't know, just come here. Like, that makes it worse because now you're training people and trying to do the job. So you go like this before you finally eventually climb out. So first, to me, this initial scale phase, it's this climbing out sort of like a J-curve looking thing.

It takes a little bit dip in productivity overall, but

it

picks it up.

And it makes it worse. Okay, so eventually it's like, okay, it's not we've solved everything, but okay, now we're doing this. Okay, we're not totally behind. At this point, at some point from here on, you could think, Is there, do we need to do more? So of course there's gonna be a judgment call, but there's a couple of things you can look at. You could say things like, our marketing channel is being saturated. We can't get more from it. Sure, we'll optimize A/B tests. Maybe we get 10, 20% more because, but like there isn't another 10x for sure. And there's probably not even another 2x. There might be like 50 new customers a month, 50 new customers a month, but we're never gonna have like 500 customers a month from this channel.

Right.

So our absolute growth, let's say, forget percentages again. I don't like percentages anyway. Our absolute growth is kind of capped here. So while we should optimize, we kind of have no choice but to do something else that's serious.

Add a new channel maybe.

Yeah, it could be a lot of things. It could be a new geography. It could be a new customer segment. It could be a new product. It could be a new marketing channel. You could say same marketing channel, new product. You could say same product, new marketing channel. There's lots of things you could do. There's tons of stuff, but just this marketing channel and nothing else, that's You know, we kind of tapped that.

Yeah.

So that's an indicator that maybe there's something else. Or, hey, our, you know, profits are such that we can simply afford to make a real investment in something. So for that monetary reason, you could choose to add a team or 2 on something and take a bet. We might be wrong, but we can afford to be wrong. How about that? Okay, if you can afford to be wrong, that's a reason to go take a bet on something. Good reason. So there's a couple of things like this where you're like, okay, this is actually logical then to go find the next thing.

This is all post-PMA, right?

Yeah, all post-PMA and post the scaling problem.

So

now I'm like, I'm still scaling. It's not easy. It's never easy. But I'm out of the shit. I'm out of the disaster red zone.

Survival.

Yeah, I'm out of the like, we're drowning zone.

So I got a sort of counterintuitive question, which is, as you get bigger and bigger, it almost becomes like you're the prominent player in the category. So there is a tendency that you're too big to fail. May or may not be true, but you can't internally feel overwhelmed.

If the obstacles are too big that you won't just go away, that's probably not good.

In that case, as a founder or an exec, how do you make sure that you're not trending in the negative direction though? Because you're getting so much good feedback and market share just by sheer existence now because you've been in the game for so long.

You get both because people hate a leader. Ah, yeah. So people who like, for WP Engine—

It's also cooler to hate the top. I

don't know if it's cooler, but we always do. You know, it's called tall poppy syndrome. It's worse in some countries than others. And in fact, for founders in certain countries, they'll tell you like, that's one of the things that's hard. Because being a founder is saying I'm exceptional. I'm something special. And there's a lot of places where the culture is like, no, you're not. It's a very hard place to begin. But, you know, it's very common. Even with celebrities, we love when celebrities fall. We love it.

Yeah.

Is it because it's cool? I don't know that it's cool to like it.

It's just we just do. Yeah, it's—

We just do. So like at WP Engine early on, if we had trouble with something, so we host WordPress sites. When we had trouble early on with like— The sites went down. On Twitter, people would be like, that's okay. I'm still with you. I know it's hard because we're like the underdog little guys, right? Once we weren't the underdog little guys, it's just like, I pay good money. I expect this should never happen.

100% uptime and all, yeah.

And they're not wrong. It's just like we never got— we didn't get the benefit of the doubt either. So no, it's not all good. That's not true. You get both. So I think you're probably kept somewhat humble. But another answer to that is, of course, it has to be your job to have standards and not be— that you should celebrate but not get confused when people are praising you. And you should work on it but also not get confused when something bad happens. Not get confused like, It's over. We're screwed. My failure. Like this is not. It's both not true and not very helpful way to describe it. It's better to try to describe what really happened. Yeah. Oh, we did make this mistake, or we have this gap, or did did did that. Good. Like we got to say that so that we can do something about it or not. Sometimes shit happens and there's nothing to do.

Yeah.

That's okay.

Right.

So like of course you should you should address it. Right. Right. But it's it's not good to go too far in either extreme.

Yeah. Try to keep it to that. Where do you see some of the bigger companies get wrong? Because if everyone was this thoughtful and sort of introspective—

I think a lot of big companies are like that.

Yeah?

Yeah.

They're like—

I don't think— yeah, I think so.

Okay.

Yeah.

So is there a trap to avoid or anything in this scenario? I guess the trap, because what I'm thinking about is maybe losing touch of reality with like actual customer feedback and like not really feeling what they're feeling and what they're— I guess maybe like in the social world we live in, it's hard to not get direct feedback as well. Someone would tweet at you or tweet at W3C.

When people tweet, that's not necessarily representative.

Yeah, of the whole—

But sometimes it is. So you have to be careful. All these signals, it's the whole elephant and there's the blind people, you know.

Guiding the—

yeah, okay. No, no, like, so there's an elephant, but they don't know that and they're all blindfolded. And so one's touching the tail and they're like, it's a rope. And one's touching the leg and they're like, it's a tree, right? And then, no, it's an elephant. They're all kind of right in that they're They're understanding a facet of what it is and none of them have the picture. So that's, to me, that's what customer feedback is. Stuff that comes through support is part of the elephant. Stuff people say on Twitter is part of the elephant. It's not that it's wrong, it's just not the whole elephant. People leave reviews, that's part of the elephant.

You have to keep the perspective of the—

Yeah, when you go out and interview them, that's a weird special event. Like you'll get information there you can't get on Twitter, but also it's this artificial strange thing. Actual product activity is part of the elephant. So There's, for customer feedback of quote unquote, what's reality, what's really going on. Yeah. You have to think of it to me like that and say like our job in product especially, maybe marketing, is to try to understand the elephant at all times, which means we need all of these avenues of input and we need to be synthesizing. So how do you do that? Because that also sounds hard. So one simple thing to do is you say, all right, if I have all these different channels and if I hear the same theme Okay. In like 5 out of the 7 channels, that's got to be the truth. There's no way that everyone's saying it all these different ways and it's not true.

You're looking for a pattern, basically.

Okay. Common themes.

Yeah.

And then you're like, that's probably for real. Now you can go back to those channel stats. Now, what were they saying in detail now that I actually believe this is a thing?

Right.

Now, what are they saying? Because I got to, you know, can we measure that ourselves objectively? Whatever they're subjectively seeing, can we objectively measure it? Right. So that We can then take action and see if we fixed it on our own.

Yeah.

Because again, like customer feedback is super laggy and, you know, it's super, super, super hard to do. So like for me, can we set up a metric or 2 or 10 that helps us understand it so that we can see if we made an impact sooner than trying to ask them, you know? So, but only once a theme is established, right? And it's very common for sales is another one, by the way. What we hear in sales,

those

aren't even customers yet, but they matter. So it's another one of those inputs. So sales was very much like, we just lost this deal to this because reasons, we got to do that. Well, they're not necessarily wrong, but that's not enough, is it? Or as people complain about this in support, we've got to like, maybe, but maybe it's okay that they complain about this, or maybe it's the wrong segment.

I got to follow up there with the, especially sales side of it, and then also support, customer support side of it. As a, let's say, head of product, you've been, I feel like you are, as a founder, you were the head of product. I

mean, and I was literally the head of product for a while. So

you get these bits and pieces of feedback coming in from, let's say, sales channel prospects saying that they wish they had this feature or yes, like an existing maybe account that's really converted saying that this is great, but we also want this other thing, right? Now as a product leader, how do you look at all these bits and also things that internally you know are good bets or good features to build? Like, how do you size up all these things and figure, like, how do you design a roadmap given there's all these disparate pieces of information?

So what I do is I have separate backlogs for each of these channels. The sales one, the support one, the product one, which means they're talking to customers, the product has me, engineering, because they want to do stuff that's not even customer related. Yeah, like we need to refactor this thing and I gotta, you know, they're making these features, stuff, you know. And maybe there's more. Of course, it depends on your company, right? Okay, there's these different inputs and things. So I have a different backlog for each one. And then what I do is for the ones that have a department, which is most of them, I go to the department and this could be once a quarter, once a month, whatever. And I'm like, all right, they bring specific people they think are good at the following workshop.

Right.

And we say, okay, let's make a stack rank list of what you wish we would build. it. But y'all have to agree on what you want, but you don't have to think about any other department. You sales, you can just think about sales. What do you think you can sell? Well, someone's gonna say, oh, I heard this. They're like, I've not heard that. I don't know about that, but I hear this. And then like, oh, that one, that one, that one. And they put that one for it. You see what I mean? They don't agree either. No one agrees. This is the point. Right. So it's interesting when you put them in a room, they see that and they're like, oh, because they get

mad. Maybe that was a one-off customer.

Because otherwise they get mad. I've been asking for this and you guys don't do it. You know, it's like other salespeople don't even agree with you. What are you talking about? You know what I mean? So they see like, oh, oh, oh, okay. So then they have their stack rank list. Okay, so I do this for everybody. They only think about themselves, which is good because they can do that. But sometimes they tend to say like, I heard support needs this. I'm like, never mind. You don't know what support needs. What do you want? So I get this really clear thing. So of course, if you hear similar things, you know that's going to—

okay.

Right. But even when not, And of course, you're always going to use your judgment. Obviously, you're going to use judgment. It ultimately comes down to your judgment. Sometimes you just make a call, of course. But here's what's great about it. First of all, you have this great input. And so as you're synthesizing this, you really have a good idea of what everyone thinks, which is nice. Not just one big backlog and who knows? That's not so nice. So then whatever you pick, where you're using, you know, and here also, you're also asking, can we build this? And that goes into The team capacity, the skill sets. Oh, this person's out having a baby, so we actually, it's harder to do this. Like, I mean, we're blocked on that because this other thing, there's a million things that goes into what we can actually do. Yeah. Right? So these wishlists, besides trying to synthesize it, there's also the realities of doing the work, which you didn't talk about yet, which you shouldn't because it's too complicated. You can't talk about everything at once, right? But you, the product manager, you do have to synthesize that. So this has now been organized. That's good. So you synthesize it with what you can do. All right, you're going to come up with an answer. And then you can go back to all those folks and you have something to tell them. Hey, guess what? We're doing your number 2 thing. Aren't you happy? I'll see you in a month. Or listen, I know we can't, we couldn't get to your top things. Here's why.

Right.

The reasons, oh, there's this huge theme that we're seeing from blah, blah, blah, blah here. We just feel like we have to hit it. But you can tell them that. They're like, oh, okay.

Just be honest with them.

Whether they agree or not, at least you heard them.

Yeah.

And there's like a good reason, and that's totally different stakeholder management than just saying no, right? Right. Hey, but guess what? Turns out your 6th thing, I know it's your 6th thing, turns out it's super easy. We're banging that shit out. Yeah. I know it's not your favorite, but hey, we're gonna knock out one of your things, you know? And like, it's that kind of, it sets up that conversation so easily.

And they feel heard, one. And second thing, I feel like they get a sense of the process.

Yeah.

'Cause I think sometimes they may not know all the steps needed to get that feature built. And so when you do this in a room,

like— Yeah, or they don't know what it takes, or they don't know that like there's this huge thing going on. They're like, oh, okay.

You seem like that's a bigger thing than what I'm hearing.

Yeah, okay, okay, you know. And so we forget in product sometimes stakeholder management isn't just collecting or having a meeting every 2 weeks, you know, being able to make people feel heard and explain briefly, not read this 18-page document, have you preparing forever ahead of time. Like, that's a lot of work. But just being able to say like, okay, you know, that's very nice.

Yeah.

Yeah.

Awesome. I'm gonna do a time check. How are we doing on time? Do we have until— 'cause I have 11:38. Yeah, 11:36. I think we should wrap up maybe with one or two questions. I got a question from our CMO at Paddle, Andrew Davies. We talked about strategy flowing well, right? What does it look like when a company strategy is not going well? Like, what are the signs? First of all, how does it look like?

Well, if you haven't written down what your strategy is, I don't know how to answer that. And your problem is you don't have one. But let's suppose you have one, meaning you wrote down like, we're targeting these customers, our edge is this, and, you know, they're gonna buy because of this reason, and we're gonna leverage this thing we have to And you've written that down. The obvious question is like, well, how would you know if this is happening the way you just said?

Correct.

You're getting customers in that segment. They agreed this is good. They, you know, how would you know? And it could be qualitative, but hopefully there's some quantitative things. And so then as you proceed, the question is, is that happening? Like whatever thing you said, whatever evidence you think would have happened had you been right, are you seeing it? And of course, you got to look for contrary evidence because, you know, the initial strategy can't be quite right. It can't be. So you got to be looking now. You don't have to be going crazy and constantly questioning everything. Of course, that's no way to live. But for example, when you're— each customer interview should not be trying to just validate what you think is true. Yeah. It should be open-ended questions on those topics so that if they unprompted continue to come up with the thing you said, then that's evidence of strategy. It's a little bit more evidence your strategy is correct. And if they're like, blah, blah, blah, it's like, oh, oops, that's not one of our— that doesn't completely disprove it either. This isn't physics where like one counterexample disproves the theory. That's not what this is. Maybe that's just not the right customer. Maybe it's not 100% think that, 80%, 60% think that. That's enough. So it's not full disproof, but it's contrary evidence. So it's a negative signal. Right. And so again, so just one example, if you use customer interviews and you keep it open-ended on these topics, You start seeing hopefully the truth going one way or another against, again, these things you've written down. That's how you're validating your strategy as you're going on. But of course, if you hit PMF, your strategy is probably mostly right. And if you haven't, you don't know. Unfortunately, it could mean it's wrong. Could be, you know, but it could be you're just not there yet. So hence things like customer interviews or other numbers you might have come up with. But again, Early on, you probably don't have numbers of significance where the signal is big enough that the noise doesn't overwhelm it. You probably don't have it. So while numbers is the best answer, it's very often not possible.

You don't always have the privilege of the numbers, right? Yeah.

Yeah. That's just a fact. Like, as you scale, it's one of the advantages is now in some areas, you have enough N that you can actually know things. How nice. Once you're at scale or even starting at scale, like take advantage of that. Like you're going from, we can't really, we don't really have numbers to, oh, actually sometimes we do.

You have different advantages, different stages, right? When you were so small, you had the nimbleness. You could literally just tomorrow pivot to something else and everyone's working on a whole new use case. And then, you know, you can't do that when you're post-PMF. Anyway, Jason, such a pleasure. We could do this for another hour easily, right? Such an honor, such a pleasure.

And maybe there'll be a third and we will.

We will. I would love to, you know, hopefully you don't hit me enough to not show up for the next one. Right. Thank you for joining me on stage. Shout out to WP Engine. Jason's Twitter is @ASmartBear. ASmartBear? Yeah, SmartBear was one of your companies, wasn't it? Yes, that's right. That's what we're talking about.

Yeah, that's right.

Yeah. Follow him there. And I'm @thisiskp_ on Twitter. Thank you. Awesome.

Thanks.

Awesome.