The new Face of Silicon Valley’s Pied Piper

Up until now we’ve focused mainly on Investor pitches. But there’s a pitch no less (if not more!!) important — the User/Customer pitch. Before or after you raise funding you will need to pitch — whether live or written — to those who will actually validate, use and eventually (we hope) pay for your product.

If you saw Episode 9 of Season 3 of Silicon Valley this week (And I beg you — please go watch it now if you haven’t!!! And why aren’t you watching the show? You really need to be!) you will have seen the best example of how absolutely not to pitch to users. Though they have successfully fund-raised (Check out their investor deck here), Richard, the uber-geeky yet shockingly realistic techie-CEO made pretty much every mistake in the book pitching users. I will give you a breakdown of the mistakes he made and what you should be doing instead:

Mistake #1 — Testing Your Product with the Wrong Audience — After Richard discloses to Monica (one of their investors) that they only had 19,000 Daily Active Users, (DAUs) this in spite of impressive installs (thanks to a very expensive TV ad they created), Monica sets him up for some focus groups at a Market Research firm — a great idea — get your product in the hands of real users and get their honest, unbiased opinions. When listening in to the Focus Group and hearing feedback like I was “totally freaked out” and “It just made me feel stupid,” Richard, who is having conniptions says “Clearly none of these people get it. Maybe this is a bad group?” The moderator tells him this is the 5th group to react this way. Monica then realizes that though he’s trying to sell his platform to “regular people” he’s only actually given it to Engineer friends to test. They of course loved it, but they are Engineers, not users.

— After Richard discloses to Monica (one of their investors) that they only had 19,000 Daily Active Users, (DAUs) this in spite of impressive installs (thanks to a very expensive TV ad they created), Monica sets him up for some focus groups at a Market Research firm — a great idea — get your product in the hands of real users and get their honest, unbiased opinions. When listening in to the Focus Group and hearing feedback like I was “totally freaked out” and “It just made me feel stupid,” Richard, who is having conniptions says “Clearly none of these people get it. Maybe this is a bad group?” The moderator tells him this is the 5th group to react this way. Monica then realizes that though he’s trying to sell his platform to “regular people” he’s only actually given it to Engineer friends to test. They of course loved it, but they are Engineers, not users. Solution #1 — Test with Actual End Users — Don’t go for friends and family unless they are potential users. Look at your target audience and actually get Beta Testers from that audience to test your product and give you honest feedback before rolling out. Here are some great places to get Beta Testers without blowing your non-existent budget. Gather feedback, see what are the points that repeat themselves and learn something! It’s better to invest a bit in testers and testing tools than advertising an unusable product.

Mistake #2 — Explaining in “Technese” — Richard bursts into the Focus Group room and proceeds to try to explain to the participants that they don’t get the brilliance of the product. The audience looks dumbfounded, and he says “sorry, let me explain this to you in a simpler way…” then he launches into telling them how their breakfast is made up of electrons, pulls out the whiteboard and draws an intricate flow chart of the system extolling the virtues of the “neural net” which will allow devices to collaborate in ways we can’t “imagine or predict.” This leads the audience to think that the age of the Terminator is upon us, freaking them out. After hours of explanations and pizzas, it seems they’re finally getting it! Woo hoo! 20 people have been swayed, 2 of which will now use Pied Piper.

— Richard bursts into the Focus Group room and proceeds to try to explain to the participants that they don’t get the brilliance of the product. The audience looks dumbfounded, and he says “sorry, let me explain this to you in a simpler way…” then he launches into telling them how their breakfast is made up of electrons, pulls out the whiteboard and draws an intricate flow chart of the system extolling the virtues of the “neural net” which will allow devices to collaborate in ways we can’t “imagine or predict.” This leads the audience to think that the age of the Terminator is upon us, freaking them out. After hours of explanations and pizzas, it seems they’re finally getting it! Woo hoo! 20 people have been swayed, 2 of which will now use Pied Piper. Solution #2 — Skip the How — Focus Why — Most likely (unless you have a Devops solution) your users will come from an entirely non-technical background. They don’t give a flying fig about “neural networks” and “encrypted sharding,” they care about it being a cool solution that is easy and intuitive to use. So when pitching them, start off describing a problem in their lives that irks them and then how your solution will solve that problem — this is the why they will want to use it. That gets them enthused and hopefully, using and loving your product. If Pied Piper were my client I would have suggested something like: “You know how when you have a long video it’s super hard to transfer, it takes forever, the quality is compromised and then it takes up way too much room on your phone? Well with Pied Piper in an instant, transfer big files in top notch quality and take up absolutely ZERO storage on your devices!” They don’t really care how it works, if it sounds cool and useful — they will want to use it!

Mistake #3 — Spending Money Showing Users They are Wrong — Richard decides that the best use of the meager funds that remain is to launch and all-out education campaign on why the product is amazing rather than making changes on the platform based on the feedback already received. Dinesh, one of his Devs says that a better idea would be to put the platform on hold, take the money they have left, pivot into something that works and doesn’t require hours of explanation. Yes! A techie that gets it!! Unfortunately, he is not heard…

— Richard decides that the best use of the meager funds that remain is to launch and all-out education campaign on why the product is amazing rather than making changes on the platform based on the feedback already received. Dinesh, one of his Devs says that a better idea would be to put the platform on hold, take the money they have left, pivot into something that works and doesn’t require hours of explanation. Yes! A techie that gets it!! Unfortunately, he is not heard… Solution #3 — Listen to Your Users and Iterate — Albert Einstein said “The definition of insanity is doing the same thing over and over again, but expecting different results.” Even though he saw how difficult it was to educate users, Richard was poised to embark on a long, expensive and tiring journey of convincing users that they were wrong, he was right and that this was nothing like the Terminator. He even commissions the creation of a “Personal Assistant” named Pipey, who speaks Technese as well and makes things as clear as mud, to explain things to users on the platform. If you have to work that hard to explain a product, you have a problem. So listen to Dinesh, if your users aren’t jumping up and down, listen to them tell you why not, pause the product and see how you can implement their feedback, iterate and then test again.

Find your Bernice

Bonus Tip #1 — Use the Voice of the Users — There was one lady from the focus group, Bernice, who actually got what Richard was saying and became an avid groupie, attending his workshops all over town. If Bernice “got it” she could probably explain it in a way that other users like her would get it. Find your “Bernices,” interview them, learn from them, have them give a testimonial, explanation and learn how to pitch in their words. Believe me, they’ll do it better than you and will have a lot more credibility with other potential users.

— — There was one lady from the focus group, Bernice, who actually got what Richard was saying and became an avid groupie, attending his workshops all over town. If Bernice “got it” she could probably explain it in a way that other users like her would get it. Find your “Bernices,” interview them, learn from them, have them give a testimonial, explanation and learn how to pitch in their words. Believe me, they’ll do it better than you and will have a lot more credibility with other potential users. Bonus Tip #2 — Steer Clear of “Vanity Metrics” — At a “deus ex machina” moment, Richard wakes up to see that the DAUs have nearly doubled literally overnight. It’s a miracle! Actually, it’s Jared, the loyal COO, using the last of their funds on a “click farm” in India that we get a sad glimpse of at the end of the episode. In his trying to cheer Richard up and keep him from throwing in the towel, he’s created a set of “fake metrics” — a big no-no because it always catches up with you, as inevitably it will in before the end of the season. Also, steer clear of “vanity metrics” or “feel good” metrics. These are the metrics that look impressive but don’t actually hold any real weight. Josh Kopelman, partner at First Round Capital says: “The real data is retention and repeat usage. Instrument your site to track that data.” Chris Dixon, GP at Andreesen Horowitz agrees, stating that it’s better to try to understand why you lost users and what excites your engaged users. He thinks it best to launch an MVP and reiterate quickly.

“If you aren’t embarrassed by your first product, you have launched too late,” he says. Learn from early mistakes, improve the product, stay lean, and keep moving forward quickly.

Words to live by…