📰 The Solo Founder Newsletter #97

Brands are about feelings, and feelings are complicated. When you ask people why they love certain brands, it’s often hard for them to pin down. They might provide a list of rational and logical reasons, but in the end, it often comes down to a feeling. How does that brand really make them feel? And why do they come back for more of that feeling? Why does that feeling mean something to them? Successful brands today are always emotionally infused. They hold great emotional meaning for people and that’s what makes that brand loved and respected.

Highly recognizable, well-known brands are often used to define what a brand is. More often than not, the question of defining what a brand is is answered with a list of popular, well-known, established brands. Think Nike, Apple, Google, etc. Although these examples can reveal a lot about what a brand is, just thinking of the definition in terms of these big names isn’t enough. Consider all types of brands – big and small, global and local, new and old. Maybe even consider what businesses lack a brand and what makes them different from businesses who have built a brand they rely on. There’s a lot to learn from all the brands we interact with every day. Each brand is meaningful because of something different, and this is often what differentiates a brand and makes it powerful to the people who matter to it.

Defining the impact a brand can have is often easier than defining what a brand is. When we talk about defining what a brand is, we often talk about what makes a brand impactful for a business: stronger ROI, an aligned leadership, a more engaged workplace, etc. And when we discuss impact – whether it’s from a brand refresh, a new positioning, a great campaign, or just further brand engagement – that’s where we see the brand really working. That’s where we see it living and doing its job. Take the impact of an engaged workplace. Here, we see the brand in action – creating specific meaning and value tailored for employees and recruits of the right fit that increases innovation, productivity, creativity, loyalty.

PLA #1: Encourage users to invite other users In software startups, there are two ways to encourage users to invite other users: (1) naturally or (2) via artificial incentive. The natural way is a form of PLA, and it looks like this:

• Zoom’s PLA: When talking to a lead via Zoom, you’ll ask the lead to install Zoom in order to chat with you. In doing so, you brought Zoom a potential new customer. • WhatsApp’s PLA: When you invite a friend into your chat group on WhatsApp, they have to install WhatsApp first. • As mentioned earlier: When you send someone $1,000 via Paypal, they need to sign up to receive the money. Now let’s compare natural invitations to incentivized invitations—also known as referral programs. For example, you and the person you’re inviting both get $25 for signing up. Referral programs like these are much worse than natural invitations for three reasons:

Most users don’t care about receiving a small cash reward—especially business users. Cash incentives attract users who are likely to quickly churn (stop using your product).Users are uncomfortable spamming their friends about your new product. The poor performance of most referral programs teaches us that new users should come for the product’s core value—not for a cash reward—otherwise they’re likely to leave.

For natural invitations to work without incentives, the invitation has to take one of two forms: users are invited either to (1) receive something they’re owed or to (2) join a conversation that’s important to them:

They’re owed something: When an existing user invites a new user in order to give them something they’re owed, the new user almost always accepts the invite. For example, if they’re receiving a cash payment (Venmo) or profit participation (AngelList), signing legal documents (DocuSign), or receiving an expensive NFT they purchased.They’re joining a conversation: When a user invites a new user in order to include them in a conversation both parties care about, the new user almost always accepts the invite. This is why Slack, Discord, Telegram, Zoom, Clubhouse, and other conversational apps grow so quickly. Here’s the takeaway: When designing your product, ask if your product is used to send valuable goods or facilitate important conversations. If so, get as many of your users as possible to use that feature as much as you can. That’ll trigger viral growth via product-led acquisition. Similarly, if you’re deciding between two equally good startup ideas, choose whichever is better used for these two purposes.

For the past few years, I’ve done all my software development on a home server. It works great, except for when I screw up the network configuration or want to install a new operating system. My server has no monitor or keyboard attached, so I have to drag it over to my desk, swap all the cables with my workstation, and then swap everything back when I’m done.

I’d read that a Raspberry Pi could masquerade as a USB keyboard, and I knew it could capture video. What if a web app combined those two features and transformed the Pi into a miniature remote administration device?

After a few months of tinkering, I had a working prototype.

I questioned whether there was a market for this. Why would anyone buy this device from me? It was just a collection of widely available hardware components. Maybe one or two customers per week would purchase, so if I made $80 per kit, it would be worth my time packing and shipping orders.

Then, I published a blog post about it.

Immediately, it became clear that this business was different than anything I’d ever done before. Less than four hours after the blog post went live, customers had purchased all nine kits from my inventory, and they kept buying even when it was backordered.

Within a week, the blog post had driven $8.8k in sales. It reached the front page of Hacker News and became one of the top “Show HN” posts of all time.

There was a drop in sales after that initial spike, but TinyPilot has been growing consistently ever since. I had zero experience selling a physical product, so I quickly learned how to manage inventory, systematize the order fulfillment process, and work with vendors to make circuit boards and 3D-printed cases.

TinyPilot ended the year with almost $54k in revenue. My net income is still negative, but it’s because my costs are front-loaded. TinyPilot’s expenses for 2020 include inventory to last through February 2021.

I’d like to take you back in time six years, to a time when the world of blogging was very different.

The “premium WordPress theme” was in its relative infancy, the default WordPress theme was Kubric (HuffPo claims “Kubrick has helped change the face of cyberspace”) and WordPress 2.9 had just launched, boasting the addition of being able to “trash” posts.

At this time I was 15 and running writing a lot of WordPress tutorials, alongside studying for my GCSEs. I could see the gold rush to sell WordPress themes happening and reasonably assumed I could be part of it.

I spent six months building an okay theme with a partner and didn’t go great. The product failed. After talking about survivorship bias (and accusing the classic product case study of misleadingly highlight success) I figured I should share my story and (in an attempt to avoid survivorship bias) clearly say what I’d do differently now.

Let me walk you through what I did wrong and what lessons can be learned from my unsuccessful foray into the WordPress theme market.