The Physics of Startups
00:08:11 · S0
[00:08:11] S0: Yeah, yeah. That would be an interesting one to go deeper on pre more premium product uh products. I know you you tend to think on the kind of fringes and the extremes. That would be a cool one to investigate sometime. Um let's get to this one's from DJ Just One. One thank you for having a handle that I can pronounce. Um and this one is in the cold outbound uh episode. Uh and DJ writes, uh, you helped us get to an 85% close rate close rate on calls, but our bottleneck is the pipeline, and the outbound game has changed with AI. We've tried the be interesting thing, and later on they they commented that like they took the approach that's similar to the um Snoop Dogg invested in us. Apparently they have an interesting investor. Um, and so they they write, we've tried the be interesting thing, but just not cracking it. Uh two questions here. Um, one is in your perspective, Rob, how has AI changed outbound uh outbound and pipeline? Um, and then what do you say to people when it's like it's just not working? Like they're they're trying to follow your advice and and they're having a hard time. Um yeah, that and this um as a sorry, quick recap. This episode on Cold Outbound discussed the hierarchy of interestingness. It was kind of like this is where you uh you laid that out. So yeah, Rob, take it away.
00:09:29 · Rob Snyder
[00:09:29] S1: Yeah, I mean there's um so I I think you might there's a couple things it could be based on this. Think thing one is just like the thing you think is interesting is actually not interesting um to your target customer. And that could that could be the case. Um, and so I I I still see very interesting messages getting very high response rates. And so I don't think much has changed there. That said, um, I actually don't think AI is behind it. I think just like, for example, LinkedIn outreach is getting like it has gone very mainstream, and so a lot of people just I have like 300 LinkedIn connection requests that I have not answered. And then so way more people are getting in the LinkedIn jail. And so yeah, it's just it's um so so I think that might might be part of it. Uh one other thing I'd say is um there sometimes outbound just might not work super well for you for whatever reason, um, just like the kind of interesting style outbound for your target market or something, there are a bunch of other things to consider. Can you cold call? Can you go to events? Can you host events? There are all these other other ways. Um I like founder magic because it often works quite well in the early days, but the point is for you to figure out what poll is repeatedly. And once you know what poll is repeatedly, then you figure out what the most effective way to find those people is. That's the toll booth thing, which is how do we put a toll booth in the situation when they would be weird not to buy? So that it so when they hit that situation, it's weird if they don't talk to us. And and so if you have an 85% close rate, you know, hopefully, what poll it is, which means you should be figuring out some way to own that situation.
00:11:31 · S0, Rob Snyder
[00:11:31] S0: Yeah. That's that's awesome. And uh congratulations to DJ on 85% close rate. That's uh that's super impressive. Um all right, let's hit um maybe one or two or a couple more. One is uh Did we hit the workday one? Yeah, let's hit the workday one. All right. This one is from uh Syed, and then that it continues. Um it's from uh it's a comment on uh your kind of like your longer lecture, notes on the physics of startups. Umed writes. Uh I would be so willing to understand the pull behind workday. It's the bane of everyone's existence, but we still can't get seem to get rid of it, neither employers nor candidates. [00:12:12] S1: Um and you know, Rob, maybe um how would you how would you characterize workday is an HR information system, HRIS. [00:12:20] S0: Yeah.
00:12:20 · S0, Rob Snyder
[00:12:20] S0: Yeah. [00:12:21] S1: That um is used in basically all big companies. Perfect. And so, yeah, and and the experience is awful for everyone. And that doesn't matter. That's totally irrelevant. I I have tried to build an HR system with uh uh to to like go and attack this market with under the theory that the user experience that everybody complained about was relevant. It isn't because what matters when you're buying an HR system is it has to work for all the relevant laws and all the relevant jurisdictions and all the places for everything that could possibly change. That's what matters, and that's how they make the purchase decision on it. There is a buyer who decides based on something like that, a checklist of things, but it basically is like, okay, cool. Um New York City is gonna pass this new stupid law, but we also need to our HR system to be able to reflect that so we can automatically comply with it and da-da-da-da-da. Right. And that happens everywhere. And that and each business requires a ton of customization to all of these kinds of things. And that is what causes the purchase, right? Like the most important thing with an HR information system is like is it is it gonna make sure we're doing things legally? Do we not get thrown in jail? User experience is irrelevant.
00:13:57 · S0
[00:13:57] S0: Fascinating. Great question, Sayed. I'm glad you glad you asked that. Um uh, let's um maybe hit one more. Uh, this one's from founders feed. Um, would love it if you also oh, and this is on uh the episode five lessons from 50 startups that reached 1 million ARR, um uh the comment or the questionnaire. Would love it if you also talked about CPG uh or business to consumer brands uh and how much your framework applies there. See the success of native deodorant, liquid death, grooms, Tesla, etc. Um, so what would you say about B2C here?
00:14:35 · Rob Snyder
[00:14:35] S1: Yeah, what's been interesting is that we've had, so I mostly focus on B2B. Um I would love to focus a little bit more on B2C, but I just don't know a bunch of B2C founders. Um, but I had a couple come in bound, and one specifically has been using the pull framework to sell a kind of D2C subscription thing, doing meta ads to a kind of eventually self-serve checkout flow. But what he has said is that using the pull framework and having these kinds of sales conversations with people early on has helped them speed run the process of figuring it out. What a lot of these B2C brands might do sometimes is like um either from their own personal experience, they're gonna say, okay, here's what I think the product needs to be, here's who I think it's for, and they'll go out and just like start, you know, running ads on that and just kind of like hope it works. Um, or they will spend a ton of money on ads to like let AI figure out what the market needs, kind of is is kind of roughly how it's how it's been described to me. And so he says, and and hopefully at some point we'll be be able to do a case study and talk about it more, but um but he says this has basically allowed him to not raise a ton of money to spend a bunch on ads and wait to learn. And his learning cycle has been super, super fast because he's talking to basically every um customer, uh, you know, interviewing every customer or talking to them and trying to fill out the poll framework and compare and contrast the people who buy with the people who don't. Um, and so it does it works there too. The mechanics are obviously different, but like I work with a bunch of B2B brands who are doing a bunch through through meta ads as well. And so I don't know how different it actually is.