“Unfortunately, the pendulum rarely swings halfway”
— Eric Paley
Eric Paley has a great post about founders hesitating to invest in growth, even when he thinks they should.
Now, I’ve been in startups where either the CEO or the VCs tried to force growth too early, and had it backfire in a big way. Thus I’ve been very responsive to Sean Ellis’ argument that you should get close to product-market fit, THEN optimize your funnel, and THEN try to scale aggressively. This approach requires a level of patience that many don’t have.
But who is right? The answer is, as always, it depends.
Transition moments, such as accelerating spend or pivoting, are among the hardest decisions for a startup CEO, up there with firing a core member of the team. You can’t dither in your decision making. You have to mix evidence, experience and intuition, and then make the best call you can.
Then do it again. And again.
The root problem is Eric’s quote at the top, “unfortunately, the pendulum rarely swings halfway.” It is all about being smart, practical and finding balance. What are the dynamics of YOUR company? YOUR market? YOUR product?
Frameworks and blog posts are simply useful ways to focus and stretch your analysis… thinking through different vectors for the problem.
If you are wrestling with this question of spend & scale, definitely read Eric’s post, and then go read Sean Ellis’ 2009 post Milestones to Startup Success. An excerpt:
Most successful entrepreneurs have a good balance of execution intuition and luck. This was definitely the case at the two startups where I ran marketing from launch through NASDAQ IPO filings. While we didn’t follow a specific methodology, our CEO was intuitive enough to know the right time to “hit the gas pedal.” We didn’t accelerate until verifying that the team had created a great product that met real customer needs and we could generate sufficient user revenue to support sustainable customer acquisition programs. It’s taken years for me to realize that our growth was less a function of clever marketing tactics than beginning with something that customers truly needed. Some growth would have been automatic; the marketing team simply accelerated this growth.