“Go-to-Market” must be on your mind from day one
You can put off monetization, but not thinking about monetization
Hypothesis: The ability to find alpha in attention markets is an irreplaceable and invaluable skill on a founding team. Recently it seems that the lack of acquisition DNA on the team is one of the more common reasons I fail to fund. Thoughts on why it’s so important:
First, it’s important to define what I mean by acquisition. There’s too much focus chasing arbitrage opportunities on Facebook/short-term growth hacks, and not enough focus on finding sustainable and scalable commercial opportunities.
It’s also not enough to just be commercially savvy. Someone on the team needs to be obsessed with looking for opportunities to grow — and the process of growth itself. Someone who is constantly seeking out the “edge of the ledge.” This can take many forms:
🏪 Markets: The most obvious path to growth is identifying underserved markets. e.g. @AdHawk is on a roll partially because the flooring industry is viewed as unattractive. Underserved markets are desirable simply because the commodity tricks are still potent.
🐁 Growing Niches: Find an emerging service — TikTok, Twitch, etc. Tap the energy of those users to propel your startup. This requires creativity, but a startup should always be able to move faster than a large corporation.
😜 Unorthodox Tactics: While a host of DNVBs have used Facebook and Instagram to accelerate their growth over the last few years, @PillPack levered the heck out of a much less & attractive growth tool: call centers. “Maybe-not-so-anachronistic” tactics can be underrated.
🏗️ Platform Shifts: @Seatgeek got out of the gates strong by making a big bet on mobile just as the market was shifting. They’ve followed up that original insight with a decade of smart decisions but it would be harder to replicate their success today on the same platform.
That’s far from an exhaustive list, but before you go into your next VC pitch meeting, think hard about two questions:
- Who on the team owns acquisition? Not as a sideline, but as a core mission. This person doesn’t have to have a track record (although it helps), but they must have a clear vision and a bit of evidence.
- What are the big bets you’re making on commercialization? If your answer is simply “buy Facebook/Google ads, maybe a retail pop up…” know that your chances are going to be severely diminished. Product and commercialization need to be designed together.
There have been times when we didn’t back the product genius because no one on the team was focused on finding the customers. It’s a critical founder skill because it’s such a hard position to hire for. The best acquisition practitioners are doing it for themselves.
Managing Partner David Frankel recently shared this as a tweetstorm. We collected the tweets as a post for your convenience. Please share it with any entrepreneurs that might need some motivation WRT monetization.