Getting users for your startup

Getting users for your startup

I was having a conversation with a client last week about how to get initial users for their startup. They were concerned that a lot of my suggestions weren’t going to scale. I countered that until they got bigger, the other methods we are building aren’t going to be very helpful. As time goes on the cost to acquire a user will be driven down as things scale, but initially that cost is going to be really high. There is no way to avoid this. Your one-hundredth users will cost you more than your one-millionth.

AirBnB is famous for being a billion dollar company, but back in the day they were struggling to get users like everyone else. In the beginning, they would comb through Craigslist for people listing their apartments to rent out and for people looking for a place to stay. They would individually email all of these people. Every single day they would email all the new posts in the relevant categories. They would individually urge each of these people to try AirBnB instead. One at a time they won people over. Eventually this method was no longer helpful so they stopped and moved on to more scalable methods.

This weekend, renowned startup investor Paul Graham (Dropbox, etc.) wrote an essay expanding on exactly this idea. In it he says:

The most common unscalable thing founders have to do at the start is to recruit users manually. Nearly all startups have to. You can’t wait for users to come to you. You have to go out and get them.

He goes on to explain how quickly compounding growth adds up. He says that starting with 100 users and 10% growth per week, “After a year you’ll have 14,000 users, and after 2 years you’ll have 2 million.” Good to hear validation and to have a really reputable source to send to the client to backup my claims with additional evidence.

The entire essay is worth a read and can be found here.