Skatin' on Thin Ice Buildin' Business & Makin' Trouble

A Pause for Reflection

The past five months I've been up and down Silicon Valley figuring out Passpack's future path. It would have been great (maybe) had I decided to blog during that time, but frankly I just was't up to it. That said, what I've learned has been so incredibly useful that I'm going to share some insights after the fact.

On Funding

A little over a year ago at Passpack, we tightened our belts for the recession. While (alas) the recession is still only barely showing signs of improvement, in July we took on some extra funding that allowed us room to explore the future development of the company. In this post we listed four goals for using those funds. To recap:

1. Continued product development
2. Infrastructure
3. Marketing
4. Improved content

While Francesco toiled away on development and infrastructure, I was in charge of marketing and content. However after looking into hiring a blogger and content writer, we ultimately decided the "content" money would be better spent entirely on marketing.

Marketing Take 1

Raise your hand if you hear "marketing" and think "promotion." Yup, promotion is exactly what I'd planned to spend our mini-budget on. We did a little SEO, dabbled in some ad-wording, tested a few landing pages. Nothing extravagant, but it all seemed to be going decently at least.

So we took a look at our metrics. We compared that with that survey we had our users fill out, and we thought, "Hey not enough web designers are using Passpack. We should reach out to them!" Shortly thereafter we had a banner ad running for a full month on Smashing Magazine.

Results? Nothing. Nada. Sub-zero response from the designers.

In our business plan web designers were one of the top five segments we expected to go ga-ga for Passpack. Stumped, I decided to pull out the original doc and check our standing on all five segments. Turns out Passpack is being used by an pretty different crowd than we had expected. Go figure.

Marketing Take 2

It was time to take a deeper look at our current - and future - strategy before doing any promotion.

What's our market position right now? is it what we want? is it sustainable? should we be penetrating deeper into the segments that already use Passpack? should we be trying to reach out to new segments? are these the business plan segments or folks we've never dreamed of?  does any of this mean product improvements, building additional products or an API/platform for building multiple products?

I decided to go straight to the source to conduct my research. I've just now returned from a 4-5 month stint at Plug and play Tech Center in Sunnyvale. What I learned is pretty amazing and merits a post unto itself.

In the meantime, I leave you with these links on metrics and customer development:

• Steve Blank, Customer Development
• Eric Ries, Validated Learning about Customers
• Interesting rant by Dave McClure (aka The Startup Metric Pirate)
• Lean Startup Circle Mailing List