Scaling the product

& Funding
For B-Plan at Pune Vidyarthi Griha's College Of
Engineering And Technology.

Rajat Dangi, Co-founder at Hapramp

Covered in today’s talk:

#1 Very early stage

#3 Growth/Scaling
#6 Funding
Building a
Successful Startup
This is a collection of learnings on best practices to
build a successful consumer tech startup. I tried to
put it in sequence from “very early stage” to “later /
mature stage”.
Before you proceed
This presentation is made solely for pure-play tech or
tech-enabled consumer startups. Some learnings
might apply to B2B startups as well. Each slide has
resources to read further. Building your startup is
about setting the right priorities, grit, and hard work.
These are guidelines that you can choose to ignore.

For any feedback or collaboration on this presentation,

DM me on twitter at @TheRajatDangi
What’s covered in
these slides?
#1 Very Early Stage
#2 Early Roles and Team Building
#3 Growth, Marketing, and Advertising
#4 Product Building in The Long Run
#5 Management
#1
Very Early Stage
1-3 founding team members, an idea (an insight),
and a dream.
Discover and define
the problem (Idea)

#1. Solve your own problem. (Organic Startup Ideas by Paul Graham)

#2. Improve an existing solution by 10X. (Such that once users

switch to your platform, they don’t want to go back to the older solution).

#3. Build in the future. (Ambitious ideas where founders envision a

future and build for it)

#4. Build using/for unaddressed/underserved market gap Or

Inflection point in technology, consumer behaviour, or legal
policies.
Find your unique solution,
refine->validate->refine->validate

# Find your potential users (in-person) and pitch them your idea.
# If they say they like it, that’s good.
# In a few days/weeks, take the MVP to them and pitch it again. If they say,
“This is awesome. I would pay for it.” -- that’s an early sign of validation.
# Ideas are useless. Validated Ideas are priceless.
# Build the core of your product first and refine based on user’s feedback.
# Refine for-- Virality: Every new user brings more new users + Retention:
Every user who starts using your product, uses it again.
The most important validating
factors for your solution

- Virality / Distribution
- Retention
Virality / Distribution +
Retention

= Product Market Fit (PMF)

Your startup’s first
milestone = PMF

Doing anything that doesn’t help you move towards PMF

(before hitting the PMF) is waste of resources.

Nothing is important before finding the PMF.

Early Phases

Idea → Traction = Finding PMF (Hardest Stage)

Traction → Growth = Optimising PMF

Idea to traction requires to your build the MVP. Once you start
getting traction on your MVP, you focus on the Growth. For growth,
you’ll need to build viral loops, delight users, and hack the UX such
that the product grows itself. This is not the place and time to think
about monetization/revenue. Sustainable and continuous growth,
retention, and achieving network effect are the fundamentals for a
great product. Revenue is a resultant.
 Measuring PMF
Method #1

Product KPI (Key Frequency

% of Users who did [KPI]

Performance (Ideal for KPI) 100% in Week 1
Indicator)

Uber Ride Twice/Week

Instagram App-Open Daily

Airbnb Booking Yearly

10% in Week 12
Letterflix Sale (Letter sent) 6 months
Time Interval
Blinkstore -- -- [day/week/month/year]
(See Method #2)
Measuring PMF
Method #2
Press Mentions
PMF =
organic/sustainable
growth in key metrics
Key Metrics

Blinkstore’s Hypothetical Example:

Reality
ation Key Metrics = Store Creation / Sales /
ect
Exp Product Listing / Visitors

Time = X Daily

Time
How do you know
you’ve achieved PMF?

- Product growing itself.

- Retention and repeat usage.

You’d know!!
#2
Early Roles and
Team Building
Two kinds of people
(broadly)

1. Generalists
Generalists are people with T-shaped skills. T-shape skill structure
means that they knows a lot of things on the surface and one
skill/domain in depth. These kind of people are crucial for startups.
They can adapt to changing needs, wear multiple hats, and as a
result the teams stay lean.

2. Experts
Experts have a I-shared skills. They understand one field the best.
They supplement with generalists by performing complex things
with perfection. Startups need experts in key roles that have highest
impact on product.

You need both in a startup. Generalists adapt and do multiple

things as the needs arise. Experts take those things forward
and do them the right way.
Role of the founder

Define-Execute-Analyse. Build teams. Keep all the stakeholders

motivated and excited.

- Quickly hacking the product, releasing it, and setting priorities.

- Setting the north star* and goals.
- Repeating the north star and priority.
- Regularly communicating with the team in written.
- Keeping people excited and motivated to work towards the goals.
- Building the team (hiring) and culture.

* North star is the ultimate goal/vision that you want your product/startup to achieve.

** I didn’t put resolving blockages and taking decisions in the list. Eventually, founder(s) must bring in
experts in each domain and delegate it. Setting vision, short/long term goals, communicating, and keeping
teams excited is a lot to do. They should then trust the teams to execute.
Building a Culture

1. Early Stage: Culture = How founders behave

2. Culture is not written in stone. It is flexible, it adapts and
improves with time.
3. Later Sage: Culture = How the organization behaves.
4. A culture written on pages is not your startup culture.
Things founders and everyone around them do is the
startup culture.
5. Don’t worry about culture if you don’t have PMF or if your
product is suffering in the market.
Team building / Hiring

A Players, high impact initiatives can Low Ego and High Empathy, people
only be lead and executed by high with these characteristics are easier to deal
performing individuals. Keep them with and perform better in a team setting.
invested in the company’s success (ESOP).
Speed of learning, how fast they
Team size, high performing individuals learned in the past and are willing to learn is
should get resources that help them very important. These people give your
improve organization’s performance. organization agility.

Generous Salary, people can put up Motivation and excitement, these

with tight deadlines, high pressure, bad feelings are psychological and do not
management, and overtime if paid the right depend on reality. People happily went to
amount. Overpaying doesn’t hurt as much wars and now they sadly go to office.
as paying less to the right talent does. Feeling of progress, achievement,
Promise them a better future money wise. friendship, care, appreciation, and collective
Adam Neuman told all seniors, “I will make mood around them affect these. Make sure
you millionaire”. you build that or fake it.
#3
Growth, Marketing,
and Advertising
Paid advertising and
traditional marketing

Refrain from spending in paid advertising and

traditional marketing without PMF or revenue
channels.

Try to remove the advertising and marketing from

your vocabulary. Instead, talk in the terms of
awareness/discovery, distribution/virality, and growth.
10 Ways to get your first
1000 users (Distribution)

1. Go where your users are. Tinder founders went to

college campuses. Jugnoo (India) went to offline public
events to promote Jugnoo app. Find your users offline.

2. SEO. Create a website. Use the right keywords. Create

your startups online profiles. And get the first 10-15 easy
backlinks.

3. Online forums. Find relevant Reddit threads, Quora

questions, or online forum. Present your product’s solution
there.

4. Online communities. Find relevant Discord servers,

Slack communities, or Facebook groups. Launch on
ProductHunt. Share your product’s journey in IndieHackers.
Distribution...

5. Social Media. Create your social media pages.

Share what your product does, how it does it better,
share small wins, and engage with your audience.

6. Teaser/Trailer. Create a teaser or trailer video and

share it on YouTube + your social media. Engage
with the viewers.

7. Offers/Free-trial. If your product is a paid product,

run offers for early users, create a referral program,
or provide free-trial.
Distribution...

8. Provide value. Create E-book, write blogs, or

make videos that are valuable for your audience.

9. Use your own online presence. Share what you

are building on your LinkedIn, Twitter, Facebook,
About.me, in your email footers, Instagram, and
blogs. Ask people to try it out and share their
feedback with you. Incentivize feedback.

10. Friends, family, and their network. Use personal

messages to reach out to your own connections. If
they are not your ideal users, tell them who is your
ideal user and request an introduction.
10 ways to make your
product viral

1. Utilize social graph of your users. Utilize social

logins, take permission to view contacts, and make it
easy for the user to invite his/her network. Cleverly
use those contacts and enabled them to discover
your product.

2. Referral & Rewards. Incentivise referral. Reward

users to refer the app. The rewards can be in any
form.

3. Make switching easier. Create tools and features

that help new users switch to your product from
their current stack. Ex: Medium made it easy to
switch from Wordpress.
Virality...
4. Compensate for cold-start problem. Two-sided
marketplaces face cold-start problem. Stick to one use case
and user segment. Manually (spend if required) onboard
one side of the marketplace and aim for the tipping point.

5. Aim for deep network (not widespread). To get network

effect, you need lots of users on your platform who already
know each other. This creates a sense of virality in the users
and they tend to invite more people to it. Grow into specific
cities, communities, and demography.

6. Meticulously craft the “Aha moment!” Read Hooked

and figure out what’s the reward in your product that users
get, when they get it, and how they feel in that moment. A
great Aha moment is a must for “word of mouth”.
Virality...
7. Create reasons for users to share your product.
Nudge them to bring their connections to the app.
Demonstrate value they’ll get if they do so. Give them
shareable content.

8. 10x the ease of use where competitors are lagging.

This could be as simple as easy signup or as complex as
simplifying loan process in a fintech app. Aim for 10X
ease of use in every part of your product. Ex: Groww
made investing simple.

9. Do One thing GREAT! The key use case of your

product that the users care about should be crafted for
greatness. This leads to word-of-mouth virality.

10. Cater to a fundamental human need. Help your

users save time, save money, showoff (increase status),
save from complexity, etc.
Three Types Of Startup Growth

Classic Scale-Up Optimizing the team for efficiency Aiming for PMF
(rapid iteration and fast learning)

Fast Scaling Optimizing for sustainable growth Scaling with certainty.

Predictable growth. In the
absence of massive competitors.

Blitzscaling Optimizing the organization for Scaling with uncertainty. Aiming

(must read) speed at all cost for market dominance or
creating strong network effect.
The Three Key Techniques
of Scaling

1. Business Model Innovation

High gross margins, new models of generating revenue, etc.

2. Strategy Innovation
Figuring out product virality, cracking/hacking growth, etc.

3. Management Innovation
Optimizing the team structure and human resource to achieve big
goals.
Four Growth Factors and
Two Growth Limiters

Growth Factors
1. Market Size
2. Network Effect
3. Gross Margins
4. Distribution

Growth Limiters
1. Lack of Product Market Fit
2. Operational Scalability
#4
Product Building in
The Long Run
Product is everyone’s
responsibility

Founders, developers, designers, growth hackers,

and people in each and every role in the company
are working on The Product. Any role or activity that
doesn’t benefit the product achieve its goals is
eating your scarce resources.
Product building is about
prioritizing and organizing

Prioritizing: What gets built when. What gets built first.

How to release quickly. How to iterate quickly. How not to
delay release. Whose feedback to listen to. Which bug/issue
is the most severe. What can we ignore. Which platform to
build for. Whose issue we resolve first. Etc.

Organizing: The problem statements, potential solutions,

written and designed resources, code base, documents,
and product roadmap. Picking the right tech stack and
components to build different parts of the product. Setting
the most efficient process for your stage and team size.
Collecting feedback. Validating hypothesis.
 Four BBs
Bread & Butter Brilliant Basics
Your Core business which generates enough money to Processes and tech that you need to run your product
stay operational as a business. This part/product of the but isn’t unique to it. These are the building blocks. The
company must get required resources and should rely tech infrastructure, scaling needs, code cleanup,
on strong processes in the long run instead of key technical debt, basic user flows (parts where you do not
people. innovate), etc. The basics must be kept brilliant and
time and again, resources should be allocated to keep
it tidy and running.

Big Bets Breaking Bad

When the core product is growing well, generating Breaking Bad is a bigger version of Big Bets. A
revenue, and the team feels confident of it. At that successful company can take only one (at max two)
stage, companies start taking Big Bets. To spin-off new chances of breaking bad in a year or 5. It’s different for
initiatives, product lines, and customer lines. This is to the Big 4 tech companies where they are betting big
leverage the resources, learnings, and the existing and breaking bad at the same time. When you want to
market capitalization. Big Bets needs new/separate enter into a new market, expand your product line,
teams, early-stage mentality, quick execution, and a changing the definition of your company, and building
sprint towards PMF. beyond the core of your product.

-- Shivangi Srivastava
Data, Insight, and
Hypothesis

Write down hypothesis for everything you build and

execute.

After execution and release, match your hypothesis

with the outcome.

Call spade a spade. Be quick, honest, and truthful to

yourself and your team.
Data, Insight, and
Hypothesis
Prioritization Framework

Focus on Customers Focus on Competition

50% 10%

Focus on Economics Focus on Future

20% 20%
Quality Ideas Over Busy
Work

Startups operate in scarcity of time, money, and

resources.

- Not enough time to build the products with

perfection.
- Not enough capital to spend on big teams, senior
talent, and advertising.
- Not enough human and tech resources to do
hundreds of things.

Hence, it is better work on quality ideas (do less),

faster.
#5
Management
Hierarchy of roles at later stage
1. Founder and CEO
CEO manages the executives/co-founders. Leads with 1 to 10 years of vision, builds
key relations in the industry, sets priority/goals, and leads the direction.
2. Co-founders
They overlap with the executive roles. For several years (1-4), first time founders play
all the roles, from 1 to 5 (they have no money or options). But with time and progress,
co-founders should assume roles on which they are the strongest and take new
initiatives. They work on 1 to 5 years vision.
3. Executives
Manage managers. Executives take decisions, resolve blockages, manage funds, do
key hirings, build organizational structure, introduce and improve processes, and
lead new initiatives.
4. Managers
Manage contributors. They work on weekly and monthly timelines and tasks. On
some long-terms goals, they also work on 3 to 6 months of timelines. They resolve
blockages of contributors. Manage teams and keep people happy.
5. Contributors
Work on daily and weekly tasks. They make progress every day and execute the task
at hand.
Introducing OKRs (Objectives
and Key Results) + Initiatives

Management by objectives, is a method

for defining and tracking goals, and
prioritizing initiatives.
OKRs Framework

Objectives Key Results Initiatives

Where do I need to go? How do I know I’m getting What will I do to go there?
there?

Non-measurable and Measurable, ambitious, and Good balance of high impact

inspiring not impossible initiatives with low, mid, and
high complexity.

SMART Objectives: Specific, measurable,

achievable, relevant, and time bound.
Implementing OKRs - The
Executional Heartbeat

Teams take initiatives and

Leadership defines organisation execute. Reviews progress
wide OKRs for the year. every two weeks.

Different teams define their own Best Practices:

quarterly OKRs, alignment with
the annual OKRs - Set OKRs frequently
- Keep prioritizing for agility
- Don’t have too many OKRs
- Make them transparent
- Align teams
Q1 Q2 Q3 Q4 - Update progress regularly
- Appoint OKR ambassador
1 Year
Main Reasons Workers Quit
Their Jobs

For More Money 44%

For a company with a higher purpose / stronger mission 12%

Don’t feel appreciated 12%

Bored / Unchallenged by work 12%

Bad commute / want something closer to home 7%

Corporate culture is not a fit 7%

Unhappy with boss 6%

Finances, Legal, and
Administration Work

Outsource, spend minimal time on it,

spend generously for quality work, ask
right questions, and work with those whom
you trust.
#6
Funding
Why do you need external
funding?

- To fund product development and

business growth.

- To expand into new product lines and new

markets.

- To compete in the market with your

competitors.

And more.
Types of funding?
1. Friends and Family
When you raise a small round from your
friends and family with little obligation to
return. They fund you because of who you
are not on the basis of your product.

2. Angel Round / Seed Round

Usually raised at the idea or MVP stage by
showing the potential of the team and
product.

3. Series A and beyond

Raised at the growth stage to capture the
market share and strengthen tech, team,
and product.
How to approach a fund
raise?
1. Incubators and accelerators
Ideal for new teams at very early stage.

2. YCombinator, Hyper.com, and individual

angel investors
Ideal for teams with MVP and some
traction to show.

3. Getting in touch with early stage

investors through referral
Ideal for products that are proving
themselves in the market and getting
recognition.
What you need to prepare
for investors?
1. Pitch Deck
To communicates problem, solution, your stage, product, who you
are, and why this is the right time/team to build this product.

2. Introduction Email
An email to reach out to incubators, accelerators, and individuals.

3. Product Demo
Showcase your product and why it is the best/unique in the market.

4. Growth projection
Ideally, 1-2 years of roadmap and projected growth.

5. Expense projection
Define how much you want to raise and how you’d use the funds.
Thank you
To collaborate or share feedback on this presentation,
DM me on Twitter @TheRajatDangi.

About me | LinkedIn

Email: [email protected]