5) User Acquisition

Behind-the-scenes building Vambrace AI, a company on a mission to forge stronger relationships with users. Subscribe to follow along or visit the site here:

(typos are to make sure you’re paying attention)

Introductory Remarks

Dear Vambracers —

In last week’s post, Failure to Launch, I discussed some of the psychological hurdles I’ve failed to clear leading up to launch. In summary, I think there have been some semi-legitimate reasons for the delay of my launch as well as some super illegitimate reasons for the delay of the launch—and I’m sure it’s all somewhat par for the course of actually launching something. The good news is that I’m now hyper-committed to launch at the end of June—no matter what—and I’m increasingly frustrated at myself for the continued delays, which generally spurs me on to more focused action. So stay tuned!

User Acquisition

In today’s post, I want to explore super early user acquisition and brainstorm areas for me to find crazy people willing to try my clunky MVP. First, I intend to deconstruct what it actually means to get a user—which may feel reductive and obvious but which I hope will be constructive. Then I’ll explore some of the main channels I aim to penetrate for early users. Lastly, I’ll give a brief update on the actual launch status of the MVP and then queue things up for next week. Let’s get into it!

Why users matter

Let’s take a step back. For any business to be successful, it needs customers. A company’s customer can be defined as an individual or entity (or some thing) that freely and willingly exchanges capital, goods, or services for the company’s goods or services. There may be some debate around whether unpaid users are actually customers, and I think in this case I’d make the argument that unpaid users are not customers—but in general I’ll use “customer” and “user” pretty interchangeably.

So, getting back to things: for any business to be successful it needs customers. But, that may be too general. The value of the business is the present value of any and all future profits. Profits are revenue (i.e., money from customers) less expenses. Expenses are generally separated into variable expenses and fixed expenses. Variable expenses (also sometimes COGs) are any costs that vary with the usage of a product. Revenue - COGs is Gross Profit; and a close cousin of Gross Profit is Revenue - Variable Expenses - Costs to Serve a Customer = Contribution Margin (which is pretty much the money that a business earns from its users, inclusive of all variables and allocated-fixed costs associated with servicing that customer). Fixed expenses are costs that generally don’t vary with usage and are required for a business to “keep the lights on.” Simple examples include salaries, travel, tech subscriptions, etc. So, for a business to have any theoretical value today, we must assume that eventually its revenue will sufficiently exceed its variable and fixed costs.

And, now, in order to generate any amount of revenue in the future, the company must acquire and serve users (and turn them into customers) today. Those customers must be contribution-dollar-accretive (at some point) and there must eventually be enough sufficiently contribution-dollar-accretive customers to cover the company’s fixed costs. We could also get into a deeper exercise on customer acquisition costs and investing in marketing to accelerate customer acquisition and payback period and other stuff like that, but I feel like that’s kind of beyond the scope of where I want to take things today.

So, I guess, what I’m really trying to build to here is the uncomfortable reality that: for a business to actually ever have any value as a business (which, let’s not forget, is literally, legally, and expressly the singular goal of corporations) it must acquire and serve customers that willingly exchange capital in return for the company’s goods or services. If we continue with our assault on the dead horse, we can extract two key components here: (a) “willingly exchange capital,” and (b) “the company’s good or service.”

(a) For an individual or entity to “willingly exchange capital” we can assume that they are receiving value for the goods or services they’re purchasing in a manner that is commensurate with or in excess of the costs of said goods or services. There is some degree of subjectivity here, although there is also probably a pretty robust set of cost-analysis tools within most companies.

(b) The company’s goods or services represent the delivery of some solution for the customer. This can be software, hardware, work-product, advice, guidance, fancy PowerPoint slides, or really anything that the customer perceives as having value commensurate with or in excess of its cost (as charged by the company).

So, as I work to create a product / service that delights and serves users and eventually turns them into customers, these are pretty much the two levers I have to pull: (a) can I find customers with sufficiently burdensome pain that my solution solves well-enough to warrant their willing exchange of capital, and (b) can I create or modify my product or service such that it provides more value to the customer. I think there’s some interrelation and overlap there—and since I’m so early in the process I’m still figuring out the best user to serve. But I think you get the general picture here: I have to, (1) find customers with existing severe pain around some business process, and/or (2) create a compelling enough product that solves severe customer pain better than existing solutions. In order to engage in this activity, I need users.

What’s in a user?

I think this is where I’d like to be a bit stricter on the difference between a “customer” and a “user.” As I said above, I’m going to define a “customer” as an individual or entity that actually pays me—and I’m going to define a “user” as an individual or entity that actually uses my product.

For me in the first probably month or so post-launch, my sole focus is going to be on identifying and acquiring “users.” As I mentioned briefly in last week’s post, I plan to charge a stock $12/month subscription to see if anyone pays, but I also intend to share freely a discount code for everyone to use and ask that they instead subscribe to this newsletter (code: LETLUKESTARVE). Candidly I have no idea if anyone will pay for what I’m bringing to market.

At its core, the current MVP of my product basically allows for extremely rich, narrative-driven, and business-relevant insights into a business’ customers and users based on interview transcripts. By uploading interview transcripts, we extract all sorts of stuff and sort and organize that by “participant” for the company. We also have a chatbot that allows our users to basically ask questions about their business with the benefit of empirical evidence from their corpus of interviews (e.g., “how do my last 5 interviews inform GTM strategy and what marketing strategy could I implement to accelerate efforts there?”) which should help them in the soundness and effectiveness of their decision-making. But this is all theoretical as of right now.

So I pretty much just need to find people willing to give me like 5-10 minutes of their time to: (1) create an account, (2) upload some number of user interviews (I’m hoping for like 5-10, but we’ll see), (3) interact with my product in a way that helps them achieve some business objective or drive some business outcome or save time, and (4) willingly accept the imperfections and crudeness of my product without passing judgement on the experience. The completion of steps (1)-(4) serve to reinforce the significance of the problem that my platform aims to address and gives some indication that I might be onto something.

User activity also allows us to begin cultivating a community of customers and gives me the chance to reach out to those actual customers and talk to them 1:1 around why they were interested in my platform and how I can better serve them. I also think it’s important to just build more general trust and empathetic connection with these folks while it’s still just me, so that they can know I’m here for them and that literally the fate of my professional existence rests on their shoulders. I’ve always been a people-pleaser so I’m hoping that will be handy for this general endeavor. And then the beauty of this process is that I can then feed those interviews directly into my platform and use and test the platform for myself as this all unfolds.

Within the context of general technology adoption trends, I am going to be looking for the earliest of adopters who are willing to bear with me as we iron out technical issues and other growing pains. But people who do indeed experience some problem sufficiently acutely such that they’re still willing to work with me on roadmap and that they receive some value from the core capabilities I’m bringing to market. So I just need to find like basically as many people as possible—and really even just like 5 or 10 people at first—who are willing to earnestly and honestly engage with my product.

User acquisition

Now that brings us to actual tactics around user acquisition. Candidly, I only have about 11 or so people on my waitlist right now, and 2 of those emails are me, and then the remaining 9 are pretty much you—and I’m not sure how many of you actually intend to use my platform and how many of you just want to support me (which thanks btw!). So I expect that I’ll have to do a good bit outreach—and begging—to get people to actually test out the product. But a more concrete and semi-scientific breakdown:

Channels

• Reddit: Reddit is a magical (and scary) place full of all sorts of curiosities and oddities. I’ve already done some initial validation that the problem I aim to address exists based on some threads within r/productmanagement, which is great, and so I intend to try to figure out some clever ways to promote my product in a non-promotional manner (since Reddit has rules against self-promotion). I’m hoping that maybe I can get a few folks to actually try what I’m building based on these threads or just by posting more about the solution. We’ll see if I’m able to build any momentum there at all.

• Friends & Family: I’m also going to share it with folks in my network that I think could theoretically benefit from the product and who I’m close enough with where I think I have enough goodwill that they’d be willing to give me like 15-20 minutes of their time (to try my product) just because they like me enough for whatever reason to appease me. This is where I think it’s generally important to be kind to everyone I interact with because you never know who your early adopters will be—and I also expect that I’ll need to use a good bit of the goodwill that I’ve accumulated throughout my life to get some early users as well, so we’ll see how that goes. But, in general, I really have no issues with bugging people I know to try something I’ve built until they do it—and I’m pretty unashamed about groveling—so I’m planning to leverage this channel intensely.

• (Maybe) LinkedIn: I really don’t think I’m actually going to use this channel at least in the early days, but there is a world where I reach out to some product managers and/or growth folks at B2B saas companies that I think could be good customers or something and try to send them some stuff cold. I just personally hate whenever people cold DM on LinkedIn and I’ve literally never converted to a customer from any of those solicitations, so I’m not optimistic that I’ll have some secret code here to crack the issue. I’d honestly probably not respond to a cold DM from me about what I’m building.

• Product Management Websites: I haven’t gone deep here yet, but I’m sure there are platforms and forums our there specific to product management and growth where there might be some folks that could be interested in what I’m building. So I’m going to try to find niche communities in unrelated and/or one-off areas to spread the word of my product.

• Discord/Slack: I don’t know if there will be any bountiful ponds to fish in here, but I feel like there might be some random discord and/or slack groups with places to share new products and services or something. Again, I don’t know if there’s anything concrete here yet, but will see if anything makes sense when I start researching.

I think this is probably where I’ll start trying to acquire initial users to test the product and then from there I’ll expand into more formal distribution and acquisition channels once I have a more tightly refined product based on (hopefully) feedback from 50-100 users that I can get to mess around with my platform and talk to me about it.

One last quick note here: as of right now, I’ve made the difficult-but-resolute decision to not pursue podcast distribution (as in I start my own podcast), TikTok distribution (as in I make my own TikToks), or twitter meme-posting distribution (as in I post memes on twitter). Despite my willingness to grovel to acquire users, I also intend to maintain dignity and grace throughout this process, and I just don’t think that podcasting, TikTok, and/or Twitter are noble, dignified, or effective uses of my time for now—I also think those distribution channels are pretty saturated and I’m not sure that they’d be all that effective in actually converting engagement to use.

I’m sure I could iterate and cringe my way into some engaging online content, but I just don’t think that’s the highest ROI use of my time, and I also more generally think that sometimes those are more vanity-distribution channels, where founders and/or service providers just want to like become influencers and achieve some semblance of fame or notoriety without too much concern about eventual business success. Because if they become famous then surely they can monetize that in some way. It’s kind of like Love Island, where they’re on there for “love” but really they’re on there to become famous.

My last point here, I also think that I don’t want to be the face of the company, and I actually don’t think there should be like a human-individual face of the company. I think the company, as a brand and organism, should be able to stand on its own and like take on a life of its own. I’ll be the most obnoxious cheerleader and will obviously be architecting its image and its attitude, but I shouldn’t be directly associated with that image and attitude.

Other considerations

Some other more general considerations and tactics I’m thinking about as I start to plan for super early user acquisition and distribution.

• Virality: David Sacks (politics aside) has some incredible thoughts on how to build and grow B2B saas companies, and he talks about the importance of viral loops for longer-term and low-CAC acquisition. I think this is a nice-to-have, because right now I just need to get the core product out there and see if I can solve problems for even 10 people. But I do think that longer-term I want to lean on virality and word-of-mouth as much as possible (with word-of-mouth obviously being the most sought after form of growth and distribution out there). For me, this means enabling share features for interview insights and/or chats, and then eventually opening the platform up for organizational collaboration and stuff. But I just want to make it clear from the start that virality is pretty much the biggest thing on my mind when it comes to distribution and acquisition.

• Pseudonymous Non-Self-Self-Promotion: I think there are some find moral lines in and around the game of business, and I have a pretty clear moral compass, but that also means I’m open to doing some things that may seem amoral. For example, I’m almost positive that I’m going to create fake personas who promote my product and/or just talk about my product in public forums so that I can try to drum up some word-of-mouth-adjacent / organic-feeling interest in what I’m doing, in a way that doesn’t feel super self-interested and promotional. As I reflect on this strategy right now, I don’t think I’m going to ever have fake personas say that they’re happy customers—but I think I will have fake personas indicate enthusiastic interest in the solution and ask if others had had the chance to try it. That feels a bit more within bounds. [See, this is how culture gets built! :)]

• Wacky Copy: I don’t know how this will ultimately manifest, but I’m going to throw so much stuff at the wall to see what sticks as it relates to marketing tactics and like copy and language and stuff—and then I’ll just triple down on what works and take it from there. But I really want to like discover the voice of the brand through trial and error, and I’m not against really pushing conventional wisdom or just trying stuff. I don’t even really know what I mean here, but I want to embed an attitude of invention and freedom-to-operate and enthusiasm and weirdness in everything we do as a brand. And so we’ll see where that attitude takes us.

• Exacting Customers: I want to try to find the most difficult and exacting and discerning customers and get them on my platform. I feel like if I’m able to serve real power users and real intense product people then hitting those super high standards can help ensure a high-fidelity and delightful experience for “less powerful” users. I don’t think that I’ll pursue them immediately, but over time I definitely think that as part of like my second launch wave I’ll try to intentionally seek out more boss-mode users to get their feedback and see how much they hate the platform (and figure out how to get them from hate to not-hate).

• GTM: I should have mentioned this earlier, but I’m definitely still in the early stages of ironing out exactly who I’m serving. I initially thought maybe it’d be startup founders in search of GTM, but I’m discouraged by generally low willingness-to-pay—and so now I’m thinking more product and growth teams at early-stage B2B saas companies, but I just need to see if this resonates with them. So part of this whole experimental launch process is to try to discern the most appropriate beachhead market around which to base my GTM and distribution strategy—and refine the product as needed to better serve the needs of whatever beachhead market I deem as being the most compelling. But still something that’s very much up in the air.

Looking Forward

It’s an exciting time for the company, as we gear up for our public-private beta launch and hopefully try to get some actual people to upload some interviews and check out what we have to offer. From there, I intend to form as many relationships as possible, collect as much feedback as possible, and iterate as rapidly as possible to form trust with early adopters and refine the platform as needed to better serve our core users.

I’m now targeting an end of June launch (due to some personal stuff and a family trip), and then can spend all my free time in July on acquiring early adopters, gathering feedback, refining the product, etc.

But I also know that it’s so incredibly difficult to actually acquire any users and so I’m not taking any of this for granted, and can’t wait to hopefully experience just a single person who says that my platform helped them. I know I’ll get there eventually, because I literally won’t let myself die until I’ve at least had that experience once, but I’m just hoping I’m able to make that happen many times over here in July.

Until then, please stay tuned for more launch information and I hope you have a wonderful week full of user delight and personal development!

Sincerely,

Luke

P.S., in my subtitle “Oh user, user, wherefore art thou user?” I perpetuate a common misinterpretation of that famous phrase from Shakespeare. Juliet says “Romeo, Romeo, wherefore art thou Romeo?” by which she really means, “why is Romeo Romeo?” because if he wasn’t Romeo (and not a Montague) then their love could exist. Despite this, I still used the quote as-is with the hope that you’ll interpret it within the context of its misinterpretation. But then if you knew I was perpetuating its misinterpretation, I wanted to add this snippet down here so you now know that I know it’s a misinterpretation. Capiche? Adios!