Peter Nixey @peternixey peternixey.com
Peter Nixey & Taavet Hinrikus
THINGS I’VE LEARNED ABOUT HOW TO BUILD GOOD PRODUCT
Peter Nixey @peternixey peternixey.com
POTTED HISTORY OF PETER
• PhD in Computer Vision (left to start company)
• Raised from YCombinator (2007, same as Dropbox)
• Moved to San Francisco. Sold company 18 mths later
• Now Rails Engineer, Product lead and CEO at Copyin
Peter Nixey @peternixey peternixey.com
THINGS I USED TO DO
Peter Nixey @peternixey peternixey.com
THEN I WENT TO YCOMBINATOR
Peter Nixey @peternixey peternixey.com
Peter Nixey @peternixey peternixey.com
ACQUIRED BY YOLA
Peter Nixey @peternixey peternixey.com
VEGAS WITH YOLA
Peter Nixey @peternixey peternixey.com
SO OBVIOUSLY I QUIT
Peter Nixey @peternixey peternixey.com
LAST 10 YEARS
• Written, designed and sold software myself
• Paid and managed remote contractors (bad idea)
• Been part of 40-person product / engineering teams
• Been project / product lead in 3-10-person teams
Peter Nixey @peternixey peternixey.com
TAAVET HINRIKUS
Peter Nixey @peternixey peternixey.com
TAAVET
1ST EMPLOYEE
CO-FOUNDER
Peter Nixey @peternixey peternixey.com
TAAVET
Good price Easy to use and transparent Fast
Peter Nixey @peternixey peternixey.com
• Solves your customer’s problem
• Is built in reasonable time at reasonable cost
• Delivers sufficient strategic or financial value
GOOD PRODUCT
Peter Nixey @peternixey peternixey.com
MOST PRODUCT
Is a mutant chimera
Costs too much and takes too long
Destroys company value
Peter Nixey @peternixey peternixey.com
GOOD PRODUCT HAPPENS WHEN...
1. People want it
2. Your construction process is sound
3. You can build very quickly
Peter Nixey @peternixey peternixey.com
WHAT WE’RE GOING TO COVER
1. How to build product people actually want
2. How to build quality product that works
3. The processes that make you 10x faster or slower
4. (Why you need to embrace your inner Craigs)
Peter Nixey @peternixey peternixey.com
MAKING SOMETHING PEOPLE WANT
PART 1.
Peter Nixey @peternixey peternixey.com
• The Golden Rule of Traffic
• 10 numbers that tell you whether your project is daft
• How to interview potential customers
WHAT WE’LL COVER
Peter Nixey @peternixey peternixey.com
THE GOLDEN RULE OF TRAFFIC
Peter Nixey @peternixey peternixey.com
IF YOU BUILD IT THEY WILL NOT COME
Peter Nixey @peternixey peternixey.com
SEARCH & SOCIAL WON’T SAVE YOU
...& of 134,000 visits to peternixey.com last year...& of 134,000 visits to peternixey.com last year
Twitter 6.7%
Facebook 2%
Google 1.5%
500 page Q&A service => 500 Google visits/day
Peter Nixey @peternixey peternixey.com
10 numbers that can tell you whether your idea is viable
Peter Nixey @peternixey peternixey.com
1. GOLDEN RULE OF SOCIAL
http://www.avc.com/a_vc/2011/09/the-logged-out-user-continued.html
- 90% of people consume- 10% of people curate- 1% of people create
Peter Nixey @peternixey peternixey.com
2. RULES OF ENGAGEMENT
Registered users / installs:
- 30% will use it each month- 10 % will use it each day- 1% will be use it concurrently
http://www.avc.com/a_vc/2011/07/301010.html
Peter Nixey @peternixey peternixey.com
3. FREEMIUM CONVERSION
1% of your signups will pay
(normally 1-5%)
http://readwrite.com/2013/02/20/6-ways-to-make-freemium-work-for-b2b-products
Peter Nixey @peternixey peternixey.com
4. EXPENSIVE IS PROFITABLE
“50% of our revenue comes from only 11% of our customers..”
- Ryan Carson, Founder Carsonified and Treehouse
Peter Nixey @peternixey peternixey.com
5. CHEAP IS EXPENSIVE
“It is our universal experience that the support load for cheap/free customers crushes the support load for the higher plans” - Patrick McKenzie
Cheap accounts cost more in support(7x)
Peter Nixey @peternixey peternixey.com
6. ADVERTISING REVENUE
Social network CPM ~ $1Times Newspaper ~ $10
CPM = cost per 1,000 page views
Peter Nixey @peternixey peternixey.com
$1M/year in revenue == 1Bn page views
(good luck)
Peter Nixey @peternixey peternixey.com
7. EMAIL SUBSCRIPTIONS
Open rates = 20-40%Clickthrough rates = 1-5%
~ 1 sale per 3,000 emails
Peter Nixey @peternixey peternixey.com
8. CHURN DETERMINES SAAS SIZE
If you have 10,000 customersand 5% leave a year
then you need 500 new ones just to stay level
(so your signup rate determines your company size)
Peter Nixey @peternixey peternixey.com
9. IS YOUR MARKET SIZE SANE?
360M people in the US
Firm size # firms (US) Avg. # employees
1-100 6M 7.24
101-500 6M 10.1
501-10,000 17,000 1,672
http://www.census.gov/econ/smallbus.html
Peter Nixey @peternixey peternixey.com
10. DO YOU HAVE 10 ITEMS?
Only a fool would have 9 items in a 10 item list.
Peter Nixey @peternixey peternixey.com
CUSTOMER DEVELOPMENT
Peter Nixey @peternixey peternixey.com
INTERVIEWEES MAY BE
SEDUCTIVE
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DON’TPITCH THEM
Peter Nixey @peternixey peternixey.com
YOUR JOB IS TO LISTEN
Peter Nixey @peternixey peternixey.com
THEY MAY ASK FOR
SOME FREAKY SHIT
Peter Nixey @peternixey peternixey.comKEEP LISTENING
Peter Nixey @peternixey peternixey.com
STILL DON’T PITCH
Peter Nixey @peternixey peternixey.com
AND DEFINITELYDON’T ARGUE
Peter Nixey @peternixey peternixey.com
YOU WIN WHEN THEY VISUALISE YOUR PRODUCT IN THEIR LIFE
NOT IN SOMEONE ELSE’S
Peter Nixey @peternixey peternixey.com
TAAVET
Speaking the language of your customers and key message development
person to person currency exchangevs
money transfer
analyzing your customer feedback
Peter Nixey @peternixey peternixey.com
TAAVET
Peter Nixey @peternixey peternixey.com
THE HARSH REALITY OF YOUR PRIVATE FANTASY
Peter Nixey @peternixey peternixey.com
• The Golden Rule of Traffic
• 10 numbers that tell you whether your project is daft
• How to interview potential customers
WHAT WE COVERED
Peter Nixey @peternixey peternixey.com
HOW TO BUILD HIGH QUALITY, RELIABLE PRODUCT
PART 2.
Peter Nixey @peternixey peternixey.com
• How to avoid making the same mistakes twice
• Why releases matter more thank you think
• How to know your metrics
WHAT WE’LL COVER
Peter Nixey @peternixey peternixey.com
THINGS WILL GO WRONG
Peter Nixey @peternixey peternixey.com
DOESN’T HELP
Peter Nixey @peternixey peternixey.com
5-WHYShelps a lot
Peter Nixey @peternixey peternixey.com
WE WERE SENDING EMAILSIf people didn’t get them they freak out
Peter Nixey @peternixey peternixey.com
SO ONE DAY WE ACCIDENTALLY SWITCHED THEM ALL OFF...
Peter Nixey @peternixey peternixey.com
WHY DID THIS HAPPEN?
Peter Nixey @peternixey peternixey.com
Peter Nixey @peternixey peternixey.com
Emails aren’t arriving
Switch them on
We were using a different DB in production to development
Use the same DB in development as in production
Symptom
Fix
Cause
Cure
AND IN LARGER FONT...
Peter Nixey @peternixey peternixey.com
5-WHYS GIVES YOU CURES NOT
TREATMENTS
(and avoids blame)
Peter Nixey @peternixey peternixey.com
RELEASES MATTER MORE THAN YOU THINK
Peter Nixey @peternixey peternixey.com
WHEN RELEASES ARE HARD...
• People avoid them
• Features back up
• You learn slower
• Everyone feels worse
Peter Nixey @peternixey peternixey.com
q
Peter Nixey @peternixey peternixey.com
#2 Can you do a release in a single step?
Peter Nixey @peternixey peternixey.com
SO IMPORTANT
1. Makes sure your releases don’t break things
2. Make sure that everyone releases and it’s not one person lumped with it
3. Avoid backlogs of unreleased product
4. Speed up feature time-to-market
Peter Nixey @peternixey peternixey.com
DO IT
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ANALYTICS
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I AM ADDICTED TO STATS
Peter Nixey @peternixey peternixey.com
I’VE TRIED ALL THE STATSOPOPS
Peter Nixey @peternixey peternixey.com
I’VE EVEN BUILT MY OWN
Peter Nixey @peternixey peternixey.com
BUT I LIKE HARD NUMBERS
Peter Nixey @peternixey peternixey.com
I want to see my own data
Peter Nixey @peternixey peternixey.com
GET INTO YOUR OWN DATA
Peter Nixey @peternixey peternixey.com
GOOGLE SPREADSHEETS FOR ANALYSIS
Peter Nixey @peternixey peternixey.com
HOW LIKELY ARE YOU TO RECOMMEND OUR COMPANY/
PRODUCT/SERVICE TO YOUR FRIENDS AND COLLEAGUES?
0-10
TAAVET
Peter Nixey @peternixey peternixey.com
•5-whys for cures not treatments
•Why good releases matter
•Get freaky with your own database
WHAT WE LEARNED
Peter Nixey @peternixey peternixey.com
HOW TO MANAGE A PROJECT TO BE 10X FASTER
PART 3.
Peter Nixey @peternixey peternixey.com
THEY FUCK YOU UP YOUR PLANS
Peter Nixey @peternixey peternixey.com
BIG PLANS MEAN BIG CHURN
You will spend time...
• designing features you may never build
• discussing features you may never build
• avoiding useful features because you “need to get old stuff done”
Peter Nixey @peternixey peternixey.com
THIS IS BAD
Peter Nixey @peternixey peternixey.com
THE LARGER THE PROJECT THE GREATER THE CHURN
Peter Nixey @peternixey peternixey.com
YOU MAY NEVER BE ABLE TO COMPLETE YOUR PLANS
Peter Nixey @peternixey peternixey.com
SMALL IS BEAUTIFUL
Peter Nixey @peternixey peternixey.com
WAYS TO LIMIT CHURN
• Do it in 2 weeks or delete it
• Keep a separate feature wishlist
• Ban discussion on things which aren’t on the plan
Peter Nixey @peternixey peternixey.com
THINK FARBUT PLAN CLOSE
Peter Nixey @peternixey peternixey.com
HEALTHY BALANCE BETWEEN PREDICTABILITY
AND TIME SPENT PLANNING
TAAVET
Peter Nixey @peternixey peternixey.com
SHIP FAST
Peter Nixey @peternixey peternixey.com
YOU’RE A STARTUPYOU WANT TO BE THE BEST
Peter Nixey @peternixey peternixey.com
You dream of one day ringing the NASDAQ bell
Peter Nixey @peternixey peternixey.comBut then your buddy headbutts the cockpit :(
Peter Nixey @peternixey peternixey.com
STARTUPS LIVE ON BORROWED TIME
Peter Nixey @peternixey peternixey.com
•Time
•Money
•Momentum
YOUR ASSETS WILL EXHAUST QUICKLY
Peter Nixey @peternixey peternixey.com
YOU MUST BUILD FEATURES IN DAYS
Peter Nixey @peternixey peternixey.com
Embrace your inner Craig #1
Peter Nixey @peternixey peternixey.com
Saw this feature on Monday...
Peter Nixey @peternixey peternixey.com
took her for a drink on Tuesday.
Peter Nixey @peternixey peternixey.com
We were making love by Wednesday...
Peter Nixey @peternixey peternixey.com
...and on Thursday...
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...Friday...
Peter Nixey @peternixey peternixey.com
...Saturday...
Peter Nixey @peternixey peternixey.com
Chilled on Sunday.
Peter Nixey @peternixey peternixey.com
BUILD FEATURES FAST
Peter Nixey @peternixey peternixey.com
DON’T COMPLETE EVERYTHING
Peter Nixey @peternixey peternixey.com
Peter Nixey @peternixey peternixey.com
DON’T FIX EVERYTHING
Peter Nixey @peternixey peternixey.com
COMPLETE FEATURES ONLY WHEN YOU HAVE TO
Peter Nixey @peternixey peternixey.com
DOING THINGS COMPLETELY TAKES 4X LONGER THAN
DOING THEM SUFFICIENTLY
Peter Nixey @peternixey peternixey.com
ALSO...
IF YOUR ENGINEER SAYS IT’S GOING TO BE INTERESTING...
TRY TO AVOID IT
Peter Nixey @peternixey peternixey.com
DESIGN
Peter Nixey @peternixey peternixey.com
Peter Nixey @peternixey peternixey.com
Peter Nixey @peternixey peternixey.com
Peter Nixey @peternixey peternixey.com
Peter Nixey @peternixey peternixey.com
GRAPHIC DESIGN IS THE LAST PART OF DESIGN
Peter Nixey @peternixey peternixey.com
Peter Nixey @peternixey peternixey.com
Peter Nixey @peternixey peternixey.com
GRAPHIC DESIGNCOMES AFTER
PRODUCT-MARKET FIT
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EMBRACE YOUR INNER CRAIG #2
Peter Nixey @peternixey peternixey.com
Peter Nixey @peternixey peternixey.com
BUT YOU STILL NEED UX
...AND CSS :(
Peter Nixey @peternixey peternixey.com
Peter Nixey @peternixey peternixey.com
Peter Nixey @peternixey peternixey.com
Peter Nixey @peternixey peternixey.com
Peter Nixey @peternixey peternixey.com
Peter Nixey @peternixey peternixey.com
DON’T PAINT THESE WALLS
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TAAVET
Peter Nixey @peternixey peternixey.com
TAAVET
Peter Nixey @peternixey peternixey.com
TAAVET
$320 @ Hatchwise.com
Peter Nixey @peternixey peternixey.com
TAAVET
Peter Nixey @peternixey peternixey.com
TAAVET
Peter Nixey @peternixey peternixey.com
AVOID PROCESS GAPS
Peter Nixey @peternixey peternixey.com
MOST PRODUCT DELAYS ARE DUE TO QUEUES
NOT BOTTLENECKS
Peter Nixey @peternixey peternixey.com
MOST DEVELOPMENT TEAMSAMASS ROTTING INVENTORY
Peter Nixey @peternixey peternixey.com
REMOVE QUEUES. SPEED DEVELOPMENT.
Peter Nixey @peternixey peternixey.com
MINIMISE PEOPLEMAXIMISE CROSS-DISCIPLINE
CULL YOUR BACKLOG RUTHLESSLY
Peter Nixey @peternixey peternixey.com
• Work in genuine 2 week sprints
• Don’t settle for slow product development.
• Don’t spend time unless you have to
• Don’t spend time on graphic design until after fit
BUILDING FAST
Peter Nixey @peternixey peternixey.com
TO CONCLUDE...
Peter Nixey @peternixey peternixey.com
TO GET GOOD PRODUCT
1. Make sure the numbers make sense
2. Make sure people want it
3. Give yourself sufficient process to be reliable
4. Maximise your speed to be useful
Peter Nixey @peternixey peternixey.com
QUESTIONS?
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