Embracing failure with new products is like trying a new recipe.

Sometimes you get a delicious meal, and sometimes you get a kitchen fire. Either way, you’re learning!

You may be wondering what happened to yesterday’s daily email…

Well… here it is! I accidentally scheduled it a day too far into the future.

Without further adieu, please enjoy Tactician #00144

Lessons from Building Atlassian’s Product 

• Why Read:

  • Reading this interview will provide valuable insights and actionable advice for startup founders on leadership, resilience, customer relationships, decision-making, and embracing AI.

• Featuring:

  • Lenny Rachitsky (@lennysan), Author at Lenny’s Newsletter and Lenny’s Podcast

  • Tanguy Crusson (@tanguycrusson), Head of Product, Jira Product Discovery  at Atlassian

• Link: 

  • “Hard-won lessons building 0 to 1 inside Atlassian | Tanguy Crusson (Head of Jira Product Discovery)”

Key Concepts and Tactics:

• Embrace failure as a likely outcome when starting new products, and communicate this to manage expectations and maintain focus.

  • "Failure as the most likely outcome. It's the one thing I would stand behind in everything because I've seen before what happens when we get too complacent with it's going to work. Lessons from the previous things I was talking about. So this one really key."

• Break rules without breaking trust when necessary to move quickly and innovate, but do so carefully and transparently.

  • "If you're starting something like this, your teams will need to break a lot of rules that are established. But they need to be able to do that without breaking the trust of everyone in the organization. The rules were created to support the business at the stage where it was successful, and it just so happens that they might not work for new bets."

• Create a direct feedback loop with a small group of "lighthouse users" to build empathy and guide product development.

  • "So what we do with that is we recruit 10 people and we put these people in front of the whole team, not just the PMs, PM, designer, engineering. We meet on Zoom, we chat, we work with the same ones over months to build a product. They are with us on Slack. We have regular things."

• Maintain internal communication and demonstrate progress to build momentum and protect new initiatives from being prematurely shut down.

  • "Internal comms is everything there. The way I saw my job as, a large part as being very clear on where we were, on what we were learning on, how fast we were learning, how fast we were moving. Being super honest every step of the way, not try to make shit up and try to make it bigger than it is, more successful than it is."

• Surround yourself with people and environments that bring out the best in you and align with your values and goals.

  • "So you need to surround yourself with people and environments that can help bring out the best in you, otherwise you can turn bad. I myself have been cynical in the past working in environments that were cynical and I then decided it's not me. I do not want it to be me. It was me back then. I do not want it to be me."

• Focus on the work itself during challenging times, as it will guide you to the right path forward.

  • "Whenever that happens, what I do is I remind myself, "Keep it about the work," because as long as you make it about the work there's always work to be done and there's always a path that emerges from that work."

Tactics for Reaching Product-Market-Fit

Why Read: 

• This article provides valuable insights and strategies for startup founders on pricing, targeting the right customers, and choosing a sustainable growth pace.

Featuring:

• Christine Deakers (@deakhaus), Global Head of Content at Bessemer Venture Partners

Link: 

• “Tackling product-market fit: Tactics and frameworks for new and future founders”

Key Concepts and Tactics:

• Overdelivering in a Narrow Market:

  • Point: Focus on a specific customer segment to provide a superior experience and capitalize on the largest revenue opportunity.

  • "Through conversations with an investor, Aaron realized that trying to cater to two customer segments could just end up diluting the experience for both of them. So the team made the decision to focus exclusively on enterprise — by far the largest revenue opportunity for Box."

  • "'The hardest part for me personally was cutting off half of the market after we'd worked so hard to build both arms of the business. But, ultimately, cutting off the consumer half of the business was the best decision we ever made.'"

• Experimenting with Lowball Pricing Strategies:

  • Point: Consider lower pricing to gain mindshare and provide opportunities for future upselling.

  • "To this day, Scott continues advising founders in competitive markets to consider lower pricing. From his vantage point, it gives you the mindshare of users who refuse to use a competitor's more expensive product, and gives you infinite time to upsell free users to paid products."

  • "'Today's highest grossing [mobile] games are now free-to-play, but feature in-store upgrades or in-app upgrades. They get started for free, then once you have their attention, you have a monopoly on whatever that person needs to buy.'"

• Using Smaller Deals to Prove Scale:

  • Point: Target small and mid-sized businesses to build a customer base and social proof before pursuing larger customers.

  • "Instead of trying new enterprise sales tactics, Laura's team decided to go after more small and mid-sized businesses. Her strategy was two-fold: build a dashboard so customers could buy shipping labels without API integrations, and sell to startups who had resources to integrate the API."

  • "'We were able to amass enough customers on the platform over time to be able to successfully pitch larger customers. Finally we could tell them we're actually shipping millions of packages every month.'"

• Choosing the Right Pace of Growth:

  • Point: Challenge conventional wisdom and adjust spending levels to achieve sustainable growth without assuming excessive risk.

  • "Despite startup culture being prescriptive about how to build a SaaS company, founders not only get to choose their product and GTM strategy, but also the pace of growth that will allow them to realize their goals and build shareholder value without assuming an uncomfortable level of risk. Bootstrapped companies enjoy more latitude in this regard, but the same applies for venture-backed companies that can easily adjust their spending level without stunting growth. To say there is no downside to pushing the limits of growth is incorrect — and Cloudinary is a shining example of what can happen when you challenge that convention."

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