10 Marketing Lessons for Early-Stage Tech Startups

Posted on Jun 27, 2011 | 65 comments


I made every textbook mistake at my first startup, which is why I believe I was much more effective at my second one. I have adopted the motto “good judgment comes from experience, but experience comes from bad judgment. We need to learn from doing, by trial-and-error.

If I can help you avoid some of my first-time mistakes it would be a victory. The following are some lessons I learned about early-stage startup marketing. Because market is such a broad topic, I’m restricting these lessons to PR marketing (as opposed SEO, SEM, product marketing, etc.).

1. Where Stealth is Good – There’s a lot of discussions on the web about whether startups should be stealthy before they launch or not. The truth is – there isn’t a “right” answer so for your company.  You need some guidelines to make decisions. My general rule is that it’s good to be stealth in the early days while you’re building your product and testing your market. Stealth does not mean constipated, paranoid and totally untrusting of others. It does mean not telling more people your future plans than is necessary. It means avoiding drinking too much at cocktail parties with other tech people and bragging about your plans. It means not over-sharing your deal with VCs or other investors.

The truth is that we work in a very small, tight-knit industry and news & plans spread fast. In the early days you don’t really want 3 extra teams hearing your ideas and gearing up to compete before you feel you’ve got a solid head start. Most people totally advise against stealth. They think that only by being open and testing your ideas in an open marketplace can you be successful. Be careful about this advice.

Also be careful about VCs.  Most ones that I know have very high ethical standards so I’m not concerned about that. But once a VC has heard your idea he can’t “un-think” it. And these ideas have ways of seeping into board discussions with portfolio companies as in, “have you ever thought about trying A, B or C?” It’s mostly unintentional but tacit knowledge about ideas spreads quickly amongst the chattering elite.

I actually like finding entrepreneurs who are more circumspect, less braggadocios and generally more planned about their actions.

2. Where Stealth is Bad – I do meet entrepreneurs who clearly fall on the other side of spectrum and are totally closed. I worked with an entrepreneur who was to appear at a startup networking event where he was to talk about his company’s plans. He considered pulling out of the event because he wanted to stay in “stealth mode” and felt an event like this compromised him. I counseled him to do the event (it was high profile) and talk in broad themes about the areas in which his business would compete. There are very few truly novel ideas so talking in broad themes certainly wouldn’t give away any grand strategy. In stead he went to the event and told everybody “we’re in stealth mode and can’t yet reveal what we do.” It went down like a lead balloon.

I think he really learned from this experience: Experience comes from bad judgment. Nobody likes to hear you say, “we can’t tell you anything we’re in stealth mode” so develop some generic talking points that don’t give anything away when you’re asked what you do.

The biggest problem with over-stealthing yourself is that you cut off some of your most valuable resources in terms of testing your ideas, getting feedback from smart entrepreneurs & investors and helping you figure out the potential flaws in your approach.

In my experience, entrepreneurs who are overly paranoid or are information hoarders rarely do well. They certainly struggle to find mentors as there is nothing more frustrating than trying to help a company who is afraid to tell you anything.

3. Market Today’s Puck, Not Where It’s Going – I often tell startups to “skate where the puck is going” as a metaphor for not just copying what every other company is doing today but to think about where the future lies and planning for that now.

But it is a big mistake to tell too many people where you’re heading. I call this “marketing futures.” Marketing futures can be really good for enterprise software companies where the information is passed between sales rep and potential customer in terms of near-term roadmap. The buying cycles are often 3-6 months so you want to put your best future foot forward. But don’t let this information get out into the general press and don’t market more than a few months out.

For early-stage consumer companies I would be careful not to market futures at all.

We all know that much of early-stage technology startup success comes from execution and often what you’re working on today will be rolled out more seriously over the next several months. So I recommend that companies talk in detail about the puck at their feet but avoid talking about where the puck is going. While all your competitors are trying to copy your model, you’re already on to the next thing on your engineering team.

Nobody seems more disciplined at this tight-lipped future marketing than Apple and you can see how it has served them.

4. Don’t Market a Bad Product – Perhaps the most important lesson for first-time entrepreneurs is that you can’t have great marketing for a bad product. The corollary is that it is very hard to recover from a crappy marketing campaign that over-hyped. I think I first heard this from Guy Kawasaki but it’s kind of obvious. In a world in which you’re encouraged to launch early and get feedback from customers you can often confuse “product launch” with “marketing.”

I think a great example right now is turntable.fm. It’s a buggy product but pretty damn cool. I haven’t heard them pounding their chest and running big marketing campaigns. And the product itself is invite-only so they can control volume and everybody has expectations managed. By the time they go GA (generally available product) I’ll be the kinks are all worked out. And the anticipation of wanting to see the product will build.

The strategy they’re employing is called “velvet rope” as in what nightclubs do to build scarcity and interest in getting on the inside. It also helps to keep down issues with crowds getting too big, too early.

5. Don’t Blow Your Wad Early – There is a temptation of startups to announce that they’re “first” at something so they rush to market with announcements. I know because I did this in early 2000. We rushed to market to be first and got great coverage in the Financial Times (we were in London). But our product wasn’t ready for prime time and we struggled to live up to the hype we had created.

As you can imagine that once you’re compared to Ishtar (the movie) you’ve got a higher bar of success to get people interested the second time. Not everyone has a spare 40 mill for a re-do.

6. Market to Your Target Audience – I’ve seen a lot of startups who like to write blog posts on life as an entrepreneur. That’s fine if entrepreneurs are your target market. But be clear on whom your target market is and what the messages you want to communicate to them are. I talked about that in detail on this post about how to blog as a startup.

But whom you’re marketing to is not always an easy topic. At one company I work with it’s clear that our target user today is youth-oriented and middle America as opposed to 20-something and Silicon Valley or New York. We’ve been very successful at the former. But we also need to be mindful that often the influencers are on the coasts (LA/NY/SF) and that we can’t ignore them. So we’ve launched some campaigns to be sure we’re picking up these crowds with different messages.

7. Don’t Believe the Hype – Perhaps one of the biggest mistakes in marketing is to get caught up in your competitors marketing noise. When you’re inside the bubble and paying attention to every announcement of your nearest 3-4 competitors it’s easy to get despondent when they get their killer press articles or announce new features.

Those of us that have been around the block tend to not get too worked up on any big competitor announcements. They come and go. They’re mostly fleeting. Life goes on. iMessage is announced. The NY Times puts Group Messaging companies on their list of companies crushed by Apple’s WWDC. But life doesn’t end. It’s a narrow product. Most app-to-app products are inter-operable, Apple isn’t. You have tons of differentiation. Life goes on.

8. Your Competitors Look the Same as You When They’re Naked in the Mirror – One thing that startup CEOs often overlook is the impact of marketing on team morale. Every day your team members are reading about all of the great things happening at your competitors company. You’re reading their press releases or blog posts. Insider your company everything feels like it’s going to hell in a hand basket.

That’s because that’s how it ALWAYS feels at a startup. You always have too much technical debt, too many problems, staff members quitting, not enough capital, customer complaints, etc. That is EXACTLY how your competitors feel, too. And they’re reading your press articles and thinking, “shit, they have everything figured out.” You don’t. Make sure your team knows this and stays confident. I wrote about it in detail in this article.

9. Build Relationships – Many startups make the mistake of thinking that they simply approach a journalist any time they have a story and get coverage. IIt doesn’t work that way. Journalist are constantly harangued by over-eager entrepreneurs. Go slowly. Get to know journalists when you don’t need stories. If you care about this topic a more detailed article is here.

Follow them on Twitter. Respect their profession. Read their articles. Comment. Ask if you can help be a source for other stories. Say hello to them at conferences. Understand how their job works. Understand that for every article they write they need “an angle” and if you can’t help shape that you’re not likely to get inches. The more helpful you are over time the more likely you are to get inches when you need them.

10. It’s a Marathon, Not a Sprint – Some startup teams I speak with try to lump a bunch of announcements all into one release to try and have more effect. And example is lumping your VC funding announcement into a story about major customers wins, product features or key milestones. Don’t do this.

A funding announcement is a stand-alone event. It’s an angle. There are journals who dedicate a lot of time & energy into covering funding. Focus solely on that event. When it’s time later to talk about some major customer wins or big biz dev partnerships you’ll do so. If you announce killer product features worthy of coverage then talk about that.

One strategy I encourage is to break up mini-releases into exclusives that you give to different journalists to spread the love around and give everybody something unique to write about. Nobody likes writing re-hashed stories.

  • http://gregmberry.com Greg Berry

    Regarding points 1 & 2… what about passion?  I always like to say no one is as passionate about your business/idea as you are, so get as much feedback as you can, and don’t worry about someone stealing your idea, they probably don’t share the same passion.

  • http://bothsidesofthetable.com msuster

    Passion is obviously important. And it’s true that most ideas aren’t truly novel. So on balance I believe in being more open. But if you read some Silicon Valley playbooks they make it sound like you should be totally open with everybody about everything. I don’t feel that way.

  • http://bothsidesofthetable.com msuster

    Passion is obviously important. And it’s true that most ideas aren’t truly novel. So on balance I believe in being more open. But if you read some Silicon Valley playbooks they make it sound like you should be totally open with everybody about everything. I don’t feel that way.

  • Solomon Engel

    Awesome read!

  • http://twitter.com/epicsaurus Joe Mahavuthivanij

    I agree. One of my mentors once said that, even if your competitors figure out and have 85% of what you’re doing, they won’t have the extra 15% secret sauce that you’ve got.

  • http://twitter.com/wfjackson3 Willis F Jackson III

    Regarding stealth, I like having two halves of the product/roadmap/vision.  I share both halves with advisors, potential investors, etc.  I share the more obvious half with most people.  Beyond that, I try not to share the roadmap/vision if I don’t need to.  I definitely don’t share the mechanics of everything.

    Question: do you think it is worth *not* sharing the less obvious half with potential investors unless you are pitching them live?  It seems obvious to me that you need to be able to share this stuff in order to sell the business, but maybe not.

  • http://www.missi.com/ Peter Beddows

    Every one of these 10 points – along with related explanations – is, as usual, right on the money but that should be no surprise to any regular reader of Both Sides.

    Sharing from your own actual real world experiences gives relevance and authenticity to your observations and makes them a must-read for all members of any startup and even for those already beyond startup stage which is just one reason that I typically feel moved to re-tweet, recommend and promote your blog.

    In his comment, Greg Berry (@gregmberry) also makes a very valid couple of points: “no one is as passionate about your business/idea as you are, so get as much feedback as you can, and don’t worry about someone stealing your idea, they probably don’t share the same passion”. Even Steve Blank has said as much in his own observations.

    How else can one gather useful feedback to glean information, even to verify ideas, without getting out and about, out of the office participating generally in networking? Not difficult to create a cover story to avoid revealing critical strategy or competitive data while seeking relevant pointers even from competitors. There is an old British saying “Softly softly catchee monkey”; one can afford to be completely stealthy without risking being cut-off from one’s market place and potential customer base.

  • http://www.missi.com/ Peter Beddows

    Every one of these 10 points – along with related explanations – is, as usual, right on the money but that should be no surprise to any regular reader of Both Sides.

    Sharing from your own actual real world experiences gives relevance and authenticity to your observations and makes them a must-read for all members of any startup and even for those already beyond startup stage which is just one reason that I typically feel moved to re-tweet, recommend and promote your blog.

    In his comment, Greg Berry (@gregmberry) also makes a very valid couple of points: “no one is as passionate about your business/idea as you are, so get as much feedback as you can, and don’t worry about someone stealing your idea, they probably don’t share the same passion”. Even Steve Blank has said as much in his own observations.

    How else can one gather useful feedback to glean information, even to verify ideas, without getting out and about, out of the office participating generally in networking? Not difficult to create a cover story to avoid revealing critical strategy or competitive data while seeking relevant pointers even from competitors. There is an old British saying “Softly softly catchee monkey”; one can afford to be completely stealthy without risking being cut-off from one’s market place and potential customer base.

  • http://twitter.com/MarkHall123 Mark Hall

    I love this article as it covers all of the critical marketing questions that I have recently debated. Thanks Mark for a great post. Point #8 really resonates with me as well, because I think as entrepreneurs, we often forget that the sense of nervousness, anxiety and fear exists in all startups, even those that have tremendous funding or great staffing. 

  • Anonymous

    I think one important aspect founders must also focus is on is marketing themselves within their community. Getting initial traction for your product is much easier when you have an eco-system of people supporting you and your team. 

  • Anonymous

    I think one important aspect founders must also focus is on is marketing themselves within their community. Getting initial traction for your product is much easier when you have an eco-system of people supporting you and your team. 

  • http://twitter.com/galica Matthias Galica

    As a BothSides devotee, the existence of this post about 4 months ago would have made me life quite a bit easier.  I’m a testament to some the cautionary tales above, especially #1 and #3.  If you’re a founder with endless enthusiasm and are a consummate self-promoter, that’s fantastic, but reigning yourself in for the sake of strategy is immensely valuable in instances like these.  You’re making a steak but selling the sizzle, and you can typically only bring it out to the table once.  (Extended metaphor bonus: this restaurant is packed and there’s an echo: be sure you’ve got the right sizzle because everybody’s gonna hear about it.)

  • http://www.springmetrics.com Tim Huntley

    re: It’s a Marathon, Not a Sprint – Yep, definitely do not roll up a bunch on newsworthy events into a single release.  Having something to say on a regular basis is a wonderful way to create buzz for the company.  I found this to be especially true in the local media – and this made it much easier to recruit good talent.

  • http://twitter.com/JacquelinesLife jacqueline hughes

    In my first startup, my cofounders and I were polar opposites. While I was a fan of talking about the product I was building (…to everyone that would listen), a couple of my cofounders wanted to keep their lips sealed. After about a month of development and lots of arguing I convinced them that we had a MVP to launch and gather feedback. They had originally opposed this arguing that if anyone found out what we were up to, they would copy our ideas.

    Since walking away (August 2010) I realized that neither of us were right. I built up way too much hype too soon by talking about not only what we were currently doing, but all the awesome ideas we had for the future. Unfortunately, I’m not sure if they have reached the same conclusion. To the best of my knowledge, they are still in “stealth mode” and haven’t launched yet ten months later.

  • http://www.nelking.com nelking

    Yep. My clients who have a focused, consistent communication strategy, and the things they say about their product are true and the value is easily understood by their target audience,  have a significantly easier time recruiting.  Credibility is key.  

  • http://twitter.com/Catarino Catarino™

    “It’s a Marathon, Not a Sprint.”

  • Peter Shields

    This is an excellent article. The more you pitch an idea too early, the more likely your “cool stuff” will end up in someone else’s product. It has happened to me too many times. In order to compete I filled my website, or customer presentations with futures to help establish my company’s “thought leadership” position, only to see company ABC copy it and put it into their product. 

  • http://twitter.com/RealtyGO RealtyGO.co

    About the article, fate has a strange way of working out, if you are fortunate enough to have a great idea in this competitive day and age and you have the means to produce a working model, then be thankful you are in the loop. People will recognize you passion for you idea and remember that your someone they can relate to and possibly even someone that came up with a great idea, maybe even the next facebook but better, Lol! qrtagid

  • TedK

    @msuster:disqus 
    In reference to “5. Don’t Blow Your Wad Early”, personally – I like the analogy of “shot your wad early, so that you can last longer”.

    It’s like the movie “There’s Something About Mary” – if you know what I mean 

  • TedK

    @msuster:disqus 
    In reference to “5. Don’t Blow Your Wad Early”, personally – I like the analogy of “shot your wad early, so that you can last longer”.

    It’s like the movie “There’s Something About Mary” – if you know what I mean 

  • http://bothsidesofthetable.com msuster

    re: sharing the “non obvious stuff” with investors. Yes, I would share. Just not with too many of them. Choose wisely.

  • http://bothsidesofthetable.com msuster

    Thanks, Peter. Appreciate the kind words.

  • http://bothsidesofthetable.com msuster

    Number 8 is key. And it’s important to make it clear to your whole staff because people get caught in the trap of thinking your not a very good company when they read the press releases of everybody else.

  • http://bothsidesofthetable.com msuster

    MVP launching early is almost always right. If you’re worried about people copying – just launch a private beta. When I talk about why businesses fail one of my main slides is a picture of a huge ship. My message is that successful companies know how to ship product (i.e. get it out the door!).

  • http://www.missi.com/ Peter Beddows

    You’re most welcome Mark: I speak only as I find, not being given to flannel; you know well enough how we Brit’s (even ex-pats) are in calling a spade a spade.

    You have so much knowledge and wisdom to share and you really do do that sharing extremely well. If you have not thought of putting some of these thoughts into a book, I think  you should consider it and I don’t doubt that others reading your posts would agree.

    BTW: Mea culpa. I’ve been feeling guilty ever since I unexpectedly popped the phone flash in your face while taking a photo as we were talking in a group at Home Plate after your San Diego Tech Founder’s presentation. I apologize profusely; it was extremely rude on my part – especially as you delivered such a great presentation. Strangely, I did not expect the flash to go off.

  • http://www.taxlawpro.org Property Tax Law

    Stealth Fighter Picture is quite a unique way to represent your strategy.

  • http://twitter.com/chirag9 chirag9

    Excellent blog post

  • Dave W Baldwin

    Excellent post.  As you know, I was worrying too much about all the things (ingredients) that defined my project and you end up with a cluster f*#k. 

  • Adrian

    For tech startups stealth can be made more difficult (and inversely more essential) when dealing with API’s in my experience. To ensure you don’t fall foul of the ever expanding T&Cs of most modern API’s you are forced to expose every nuance of your application. As such, when they refuse, you can’t help but consider if they have gone off to develop the feature for themselves as you are forced to build the service by yourself.

  • http://anyessays.com/ Essay writer

    This article is pure genius! Your blog is the first one i bookmarked in a long time.

  • http://www.commun.it SharelOmer

    Amazing post & very relvant to us.. 10x for sharing..

    I loved the part of “Build Relationship - Follow them on Twitter. Respect their profession. Read their articles. ” very true!

    And not just for Press coverage, also for investors, customers, leads , potential parters and employees etc..

    Relationship that is build over time can help down the road… and with social media on our side its relatively easy to build relationship with the linchpins you need in your startup today and tomorrow :)

    10x 4 sharing,
    Sharel

  • http://www.victusspiritus.com/ Mark Essel

    “It’s a Marathon, Not a Sprint” impacts and colors every other morsel of wisdom you share.

  • http://twitter.com/Joanna_Burton Joanna_Burton

    Great article.  Very important to get your timing right and not over- or under- stealth yourselves.

  • Anonymous

    Great points Mark. I think the part about breaking announcements into smaller bites & building relationships with journalists are the ones that have helped us most with our PR at Sprouter. I think it also helps to have someone with PR experience – I worked at an agency before joining so knew the key industry journalists/publications. I also knew why journalists hated PR people, and therefore tried to distance myself as much as possible from their practices. 

  • Anonymous

    Mark – I like what you said in Post #6… I see too many startups talking about their startup experience, which is great to read by entrepreneurs like me, but don’t address their target market. This is why we don’t have an active blog and aren’t saying much on our twitter account — because we don’t have anything to say to our target customer… just yet. Ofcourse we can’t wait too long either! But when we start utilizing those tools it will be with our target customer in mind…

  • Pete Griffiths

    Excellent advice.  Particularly appreciate the balanced assessment of stealth.

  • http://www.ipatient.com Dan Munro

    Great takeaway – but I always heard it slightly different.  “Experience is what you get when you don’t get what you want.”  Same lesson – and so true.

  • Smaxwell

    Mark,
    Great points, as usual.  On your stealth point, I would argue that you need to expose your product to your market, but you don’t need to expose what is under the covers.  In other words, you can keep some trade secrets stealth while not being a stealth company.  I think that Google, for example does this quite well. 

    On your last point, I sometimes wonder if breaking a funding round into more pieces spread out over time would boost PR coverage given that the press has multiple opportunities to cover the company and funding news for whatever reason gets really good coverage.  Haven’t tried the idea…

    Scott Maxwell
    OpenView Venture Partners

  • Anonymous

    Enjoyed your post.  Pragmatic.  Will take a look at your links, your have sound advice.  I really like market the puck at your feet.  If you can not prove that the puck where it currently is a money maker, no one will really care about where you think it’s going

  • http://webbroi.com Casey

    As always, great post.  Enjoyed you briefly describing points from both sides such as stealth being good AND bad.  Always depends on the company/product.  Also, the point that nobody has it figured out.  Just keep pushing hard.

  • Luke

    Spam!

  • http://www.luckyotta.com tony bordonaro

    A few questions …how long before a startup isnt a startup any longer ?….do you advertise startups on facebook? google? reddit?
    Are there better places to spend the time and money?
    Sometimes its not so easy to get feed back..even from your customers  and can you believe your friends and family …I am always ready for a lesson in whats wrong …so if you like …www.luckyotta.com  

    Sorry for the grammar …its the way my mind works and usually how I speak …someone has already told me they dont like it when I commented somewhere else so I will apologise in advance …and work on it !

  • Joe Rouse

    OK, I have to say it “You can’t always get what you want, but if you try sometimes, you just might find, you get what you need.” (Choir singing along to Keith’s riffs).

  • Carol Broadbent

    When stealth is good:  incredibly useful for solidifying your position, value proposition, demo, customer references that validate your product — and making it all consistent. Sounds like basic stuff, but tech founders often lose sight of the impact of a consistent and complete story.

  • Aa

    This post struck a chord with me esp the need to not be too naively revealing of all one’s plans. I read this post yday and found myself nodding in agreement about vcs and how they might share ideas from other entrepreneurs with their portfolio companies. To my horror, I heard today that a potential investor with whom I had shared my initial plans was a mentor to an incubator, & lo, one of the ideas to emerge from the incubator is one sounding suspiciously similar to mine! We live & learn.

  • http://twitter.com/scottarneill Scott Arneill

    totally agreed. I think this happens a lot in our world (space) in the context of seeing funding announcements and equating funding with success…

  • http://crowdbooster.com/ Ricky Yean

    I feel like “shit, they have everything figured out” all the time, even though I tell myself to stay very focused on our vision and market. It definitely takes a toll, and it’s great to hear from you about how every startup feels this way. All the other points are great, too. I took a lot away from this post. Thanks for another great one.

  • Mtalmi

    Great read, thanks!

  • Mtalmi

    Great read, thanks!

  • http://dantech.tumblr.com Daniel Tung

    Hi, I’m just curious, I wonder if there’re any angel capital venture for hardware startups? I mean if I have a few novel ideas on mobile device design or technology, where can I apply for money?