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July 15, 2014 | Startups | Posted by Will Fraser Will Fraser

3 Unscalable Tactics You Should Use Right Now

The following is a guest post from Referral SaaSquatch CEO and Co-founder, Will Fraser.

I’m a big believer in doing “things that don’t scale” as Paul Graham put it. I’m also a big believer in being efficient, avoiding waste, and not working for the sake of it. These two concepts may sound diametrically opposed, but they really aren’t.

Doing things that don’t scale actually saves you time and money while letting you try out a product idea, jumpstart your customer base, or get your brand into the spotlight. Then, with complete confidence, you can make the call to invest, or not to invest, the time to build a scalable solution.

Put it simply, you can’t afford not to do things that don’t scale.

#1 Hands-on Installs A.K.A. the Collinson Install

First time entrepreneurs often ask potential customers “Is this something you would use?” Unfortunately, since this question is vague, and requires no real commitment, most people will respond with an affirmative.

More experienced entrepreneurs know to ask “Is this something you would use for $25 per month, starting today?” This question is likely to get a much more honest answer because people are actually deciding to buy your product.

It’s at this point that people typically start evaluating if your product has that ‘must have experience’ worthy of their hard-earned cash.

Unfortunately, once you get past that all-important ‘evaluation stage’ there are still some crucial steps that can be easily ignored between commitment and collecting payment from your customer. You can lose them for any number of reasons including signup friction, configuration drop off, or just the need to enter a credit card. The fact is, many of those that say yes truthfully will still never use your product.

The brave, and unscalable entrepreneur, will follow up the previous question with, “Great, lets get you setup right now” and set the customer up, all the way to collecting payment information, right then and there.

Just a word of caution, if you catch someone off guard with this and they start to try to back peddle, no matter how hard you push ahead they are just going to cancel when you leave. Instead, stop, discover and address their concerns, and then ask for the deal again.

You can do these manual installs in person or over skype. If you are doing it over Skype, it’s best to get the customer to block off enough time to sell them and install them so they don’t have to leave halfway through the process.

#2 Exclusivity

At some point you’ve wanted something you couldn’t have, only to eventually get it and realise it wasn’t that great. But now there is something else you want that you can’t have and even though it probably won’t be that great when you get it, you still want it.

Exclusivity is appealing to almost everyone. When you can make your product exclusive, it too can become more appealing. However, most services plan to go mainstream at some point. It lets you capture the largest market. This by default makes exclusivity an unscalable approach.

Facebook started out as an exclusive network just for Harvard students. By restricting users, it increased the demand for the product amongst the users’ excluded friends, and reduced technical issues relating to scale.

Product Hunt started out as a curated product list for other techies in the Bay Area, now it’s one of the hottest tech communities attracting hundreds of thousands of visitors per month. Ryan and Nathan built it with exclusivity from the very start. Starting by restricting who can contribute links, how many products get featured per day and eventually restricting who can comment on the posts. Personally, I find the comments addicting as it creates a ‘fly on the wall’ effect for the audience hooking us into how founders and VC’s talk shop and interact with each other.

Regardless of how you’re making your product exclusive, it won’t last forever. As you expand, you will need to open up bigger markets and will eventually leave exclusivity behind.

#3 Manual Fulfilment

Manual fulfilment is one of the most overlooked, and least scalable growth techniques but for products with a clear deliverable and timeline they can be great time and money savers in the beginning.

For example, let’s say you were running a service for sales reps that lets them send short emails about each sales call, then have it show up in SalesForce automatically by the next morning. You can manually complete this task without building anything. Of course this won’t work at scale unless you can charge a lot for the service and have access to a large workforce.

Manual fulfilment allows you to test your product idea and start generating repeatable revenue before you’ve built a single bit of product. Then, as your customer base grows, you can begin to automate more of the process, effectively increasing your profits and improving scalability until ultimately the entire product is built.

This unscalable growth technique can lead to slower product development and company growth if you follow it all the way through from idea to product. However, if you’re determined to be a bootstrapped entrepreneur, I would strongly recommend you look at this option.

Conclusion

Time is the most precious resource a startup has. You don’t want to waste it by building scalable, but unproven processes, products, or marketing campaigns.

It’s important to validate that a growth technique is going to work for your business before you worry about making it scalable. Once you know a growth technique works for your business, you can give it to your team to scale and move on to finding the next one.

I’ve only shared a few unscalable techniques here in the article and don’t feel like this is all you can do. The next time you think about something that could help you grow, but isn’t scalable, jump in and give it a shot the manual way. It may just be the very thing you need to grow.

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Written by

Will Fraser

Will Fraser

Will Fraser is the CEO and Co-Founder of Referral SaaSquatch, the customer referral platform for subscription businesses.