Joining VarageSale (and Moving to Toronto)

Three years ago I joined an early stage startup, GoInstant, and moved to Halifax. A year after that, we were acquired by Salesforce. It’s been an incredible experience. A genuinely life changing one.

But as they say, “all good things must come to an end,” and as of last Friday I said goodbye to GoInstant and Salesforce and started a new chapter in my life. It was not an easy decision, but I’m insanely excited about what comes next.

In a week from now (after a short vacation) I’ll be joining VarageSale as VP Product.

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VarageSale isn’t a household name (yet!) but it’s a company I’ve known since it started. In fact, it was my first angel investment at the end of 2012. And I’ve known one of its founders, Carl Mercier, for many years (his wife, Tami Zuckerman is a co-founder). Carl is one of the few people that I’ve always wanted to start a company with. I didn’t co-found VarageSale with him, but we’ll finally get a chance to work together.

VarageSale is an app (web, iOS and Android) for buying and selling your stuff. It sounds simple, but it isn’t. Lots of people have tried and failed. It’s a massive, complicated and messy market.

And VarageSale is a rocket ship. I can’t share many details with you, but suffice it to say I’m convinced we’re on a path to amazing success. I wouldn’t have joined if I felt otherwise. (And I’ll leave it at that!)

Along with joining VarageSale, I’m moving to Toronto in mid-August (and yes, my family is coming with me). We’ve really enjoyed our time in Halifax, but now it’s time to move on. I look forward to meeting lots of startup folks in Toronto, but please be patient, it’s going to take me some time to settle in. I also have a new (416) phone number; if you have my old one and want the new one, send me a message.

I owe a lot of folks at GoInstant and Salesforce some huge “thank yous”, including Jevon MacDonald, Gavin Uhma and the entire team. I know they’ll continue to build amazing products, and help Salesforce innovate and lead. It’ll be sad watching things from the sidelines, but change is also good. And in this particular case, I couldn’t say no.

I’m looking forward to getting to know the VarageSale team and working with them. We have an incredible amount to do. And it couldn’t be more exciting!

One last thing: VarageSale is hiring a Web / Mobile UI Designer. If you’re a designer, you’ll want this job. Trust me. So apply!


Engagement is a Long-Term Process

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Drip marketing is a way engaging people before they buy. You capture people’s email address and then reach out on a regular basis with something of value. Most people don’t buy or sign up the first time they visit a site, it takes multiple visits, which is why drip marketing is so important. Most companies don’t do a great job of it. They might send a lot of email (e.g. e-commerce sites often send daily emails with new products I should buy), but they don’t really engage me or walk me through a path to purchase that makes sense. They’re spamming. Email is a powerful tool (possibly the most powerful tool for engaging users and turning inactive users into active ones or browsers into purchasers), and the best companies get this.

Drip marketing focuses on how to get people to a conversion.

But what happens after someone buys? Or, what happens after someone signs up to try your product?

By now you should appreciate the importance of onboarding users. And if your onboarding isn’t working, go fix it. Most startups don’t do a great job of this, but it’s essential. But beyond onboarding, you should think of engagement–long-term engagement–as a process.

For example, let’s say you have a user-generated content site that only wins big if you can convince a lot of people to submit a lot of content. It’s a fairly big ask, even for the small percentage of crazy people that are obsessed with the subject matter. You could push users to submit content right away, making the big ask, but you’ll likely confuse or scare them. They’re not ready to commit the first time they come across your site (even if they were referred positively by someone else); they need to be wooed first.

Instead, you should engage these users in a lighter way before making the big ask. They need a light touch way of interacting and creating value (for you and themselves) before they decide to invest more time. Maybe you ask them to “like” or vote on some of the content that exists on the site first, before asking them to create content of their own. Clicking a single button is pretty easy for a user, and it’s something they already know how to do (from other sites / apps).

Provide opportunities for early users to engage in common ways, so there’s no learning curve and they get an immediate reward.

Changing people’s behavior is very hard, so don’t ask them to right away. Don’t push them through some new content creation process (or something else) off the bat, engage them lightly with something they know how to do instantly.

Look at all the “features” on your site or in your product and figure out how one leads to the next.

First, you want people to “like” or vote on something, then you’d like them to come back again and do the same (possibly because you’ve sent them an email on items they might also like to vote on), and then you’d like them to leave a review (which is a slightly bigger ask), and then you’d like them to create new content on the site (the big ask). One of the biggest questions for a lot of products is when to ask users to sign up? That has to fit somewhere in the flow, but is it the first thing you ask people to do, or the third?

Each step along the way has to create value for you and for the user.

That’s the key to “gently” pushing a user through a path (or funnel) that you’d like them to go through, which you believe is necessary for succeeding. If you don’t have a clear path and you make the wrong asks at the wrong time, users will churn out.

What do you want a “good user” to do?

You need to define a good user, over time, and then focus your feature development, marketing, etc. on bringing users through the path to becoming good. You can’t get married on the first date.

Product managers and developers can learn a lot from successful drip marketing, because essentially you should be doing the same thing, in part via communication channels (like email) but also through how your product works, what you focus on in the UI, how you bubble up features and how you guide users.

Photo from Daniel McDermott on Flickr.


The Importance of Understanding Your Best Users

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Every startup has a certain percentage of “good” users. I put good in double quotes because the definition of a good user will vary depending on the startup. You need to define what a “good” user is for your startup. Let’s look at an example…

For an early stage startup that’s got an MVP in the market, you’ll be looking at some form of engagement. In Lean Analytics we call this the Stickiness Stage. The amount of engagement depends on the product–for a consumer app you might be looking at daily or weekly engagement; for a B2B app you might be looking at weekly or monthly engagement. If your startup is highly seasonal (e.g. tax software, selling xmas ornaments), measuring engagement is more difficult, but that’s not the case for most of us.

The engagement that you care about is also up for discussion–are you looking at logins? Clicks? Page views? Other actions? Presumably you know for your startup and product, what “good use” means, and you should define that clearly. Logging in isn’t enough, especially if they just log out–so you’re looking for some level of deeper engagement, something that indicates the user is getting value from your product.

For our example, let’s go with the assumption that a “good” user should “engage” with your product at least once a week. You believe this is reasonable because of the type of product (it’s not a daily use app), the problem you’re solving, and the qualitative feedback you’ve collected from users (those that tell you they love it seem to use it once per week). You might also have enough data (a few months or more) that shows you that users who use your product once per week seem to stick around, which is a good thing. You’re not pulling “once per week” from your ass, there’s some fundamental / reasonable assumptions behind it.

You can now calculate what percentage of your users are “good”.

Ideally you have a threshold that you’re aiming for, what I would call a “line in the sand”. It’s difficult to find a benchmark, but pick something. I’m going to skip passed this a bit, but let’s say we’re aiming for 25% of our users to be “good”, or what we’ll now call “active users”. And right now we’re only at 15% active.

And btw, in this case, active users is your One Metric That Matters. It’s the single metric that everyone is focused on and working towards improving.

So what can you do to try and improve the % of active users?

Start by looking for commonalities amongst your active users.

What makes these people tick? What separates them from everyone else who isn’t using your product as frequently or who churns out quickly?

It’s in these commonalities that you may find the answer to what you can improve / change / focus on. For example, you might find that a lot of your active users share similar demographic information. That might indicate a shift in market focus is needed. Or maybe you find that a lot of your active users take a particular action (read: engage w/ your product) more times than non-active users. In this case, the particular action in question could be a leading indicator of becoming active. At minimum there might be a correlation there that you can test further.

If you do find a correlation (i.e. users that do something inside the app are more likely to stay active with the product), then you’ve found what you need to focus on for experimentation.

And the big question becomes: How can you get more users to take the action in question?

You can now come up with a bunch of experiments and:

  • see if you can get more people to take the action you want; and (more importantly),
  • see if that results in more active users.

If you do crack that nut you’re in a very good place. You’ll know what to focus on until you get your percentage of active users to the threshold you want. And you have a process for ongoing experimentation that keeps everyone aligned around the key problems and goals for the company.

I think a lot of startups ignore commonalities amongst their best users and as a result lose out on a lot of learning from them. You should know everything you can about your best users. Similarities amongst your best users will help you refine your target market (you can’t go after everyone!). And what makes your best users different from everyone else will help you drive more people to become good users, and help you find new users that more quickly become good.

tl;dr

Here’s a simpler description of what I just wrote:

  1. Define a “good” user for your product/business (which depends on the product, business, and stage you’re at). Be aggressive (aim high!) and don’t cheat yourself. Be intellectually honest.
  2. Look for commonalities amongst those “good” users (it could be anything!)
  3. Figure out how to get more “good” users (could include feature experiments to encourage more/different usage of your product based on what good users do, could be a shift in market / marketing strategy, etc.)
  4. Rinse and repeat.

Photo from Flickr.


Ben Yoskovitz
I'm VP Product at Codified (makers of VarageSale).

I'm also a Founding Partner at Year One Labs, an early stage accelerator in Montreal. Previously I founded Standout Jobs (and sold it).

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