đŠ 3-2-1 Traction â is AI a bubble? Also, original pitches suck!
The cyclical process of validation, learning by doing, extending your runway, and more! Here are 3 ideas from me, 2 ideas from others, and 1 question for you this week.
Welcome to a new week, my friend đ
Here are 3 ideas from me, 2 ideas from others, and 1 question for you.
This is 3-2-1 Traction. Letâs go. đ
three ideas from me
one: resist originality in your startup pitch.
Pitches are stories, stories have structure, and structure creates predictability.
Potential investors hear a lot of pitches â hundreds, maybe thousands.
They all start to sound alike, and thatâs where you might think itâs best to stand out. To break the mold. To be different.
But itâs actually the time to blend in.
In the sardonic words of one of my favorite tiktokers: everybodyâs so creative.
The goal of a pitch isnât to get a check â itâs to get a second meeting. Ultimately, theyâre trying to answer a single question: is this worth further discussion?
Investors are trying to get information as quickly as possible, so that they can digest, evaluate, and compare.
The heavy lifting is actually done by the pitch format: it creates expectations and allows shorthand. When you break that convention, you increase the cognitive burden on the audience, which means we surprisingly hear less of what youâre saying.
Frankly, itâs frustrating. And we just lose interest.
Remember: investors donât care how fancy your pitch is, or how original the format is.
They care if itâs a good investment.
two: startups are just validation cycles.
The work of a startup is just the cyclical process of validation. If you canât articulate your current cycle, youâre stuck.
Startup literature is full of cycles:
build, measure, learn;
ideate, experiment, data;
empathize, define, ideate, prototype, test;
observe, think, hypothesize, experiment, reflect;
etc.
But theyâre all manifestations of the same thing:
find a question to ask customers;
ask them the question;
revise your priors;
rinse & repeat.
And it wouldnât be too reductive to say thatâs all a startup âisâ ontologically.
After all, startups are just organizations incessantly iterating toward a scalable business model.
Yet, paradoxically, the vast majority of founders I talk to canât articulate what question theyâre currently trying to answer, what experiment theyâre running, what prototype theyâre testing, or why.
This is the very definition of aimlessness.
How precisely are you able to articulate what question youâre trying to answer right now?
three: you canât learn how to do startups before starting one.
This desire explains the endless supply of books, courses, workshops, webinars, and other ways to procrastinate working on whatever idea a founder has.
Thatâs not to say that knowledge of process and best practices isnât valuable â itâs extraordinarily valuable!
But itâs not as valuable as doing the work.
In other words, you could read a book on how to develop good customer interview questions â or you could just talk to a customer. You may not get the best answer, but an imperfect answer today is far better than a perfect answer three weeks from never.
Everyone wants to learn how to do it before doing it.
But you actually learn by doing it.
So start this moment today.
two ideas from others
Extending your runway is a creative task. â Itâs a simple equation: growth minus burn. But too many founders view âburnâ as synonymous with âexpensesâ. This article lists 7 ways to decrease burn without just cutting expenses or laying off employees. There are many others, if you examine your assumptions creatively.
Are we in an AI bubble? â Iâve been impressed by the flood of AI-powered startups lately, helping with everything from marketing copy to user interface design. Theyâre immensely valuable, and they point toward the awesome promise of artificial intelligence.
And it seems every other day thereâs an AI startup raising a massive round with unicorn valuations.
Case in point â Buzzfeed announced they were going to use ChatGPT to power quizzes, and their stock jumped 260% in two days.
It will triple the companyâs value?
I mean⊠really?
Yet, most of these startups donât create AI â they just implement AI. Thatâs useful for users, but is neither defensible nor sustainable for the startup.
And it really doesnât make for a good investment.
Sure smells like a bubble to me.
one question for you
What are you putting in front of customers this week?
Itâs the simplest possible question, but itâs probably the most important.
For me⊠Iâm launching two new podcasts this week: Zero to Traction, a biweekly about how first-time founders create companies that scale; and Startup Meditations, a daily (!) podcast that contains one snippet of startup wisdom for you to ponder.