"Wishing for a thing does not make it so." - Capt. Picard
Traction Stoppers Framework (Revised)
How can I get more traction? In my experience with FounderSensei, this is the most commonly asked question by startup Founders.
As a starting point to help Founders answer this question, I developed a framework for thinking about known Traction Stoppers. Traction Stoppers are issues that have stopped me and my ventures in the past.
The framework isn’t intended to be the final say in the matter. Instead, its purpose is to help Founding teams start asking the right questions that will lead them to the promised land.
The first version was developed in January of this year, as we were starting our second FounderSensei class.
Since then, LegitLead, my current startup, has continued to engage in aggressive customer development activity. DeVry is the second largest for-profit school in the world and we are honored to serve them.
Since working with DeVry, we have been trying to leverage this beachhead into other companies in the for-profit education market. Doing this has been more challenging that we expected.
It’s well documented that the for-profit edu market is having a tough time. So, on the one hand, the market is sick.
On the other hand, LegitLead is a solution to increasing acquisition costs and declining student enrollments, which is a huge problem for the industry right now. It’s a top 3 problem for sure! So, we think LegitLead is the solution to what ails these companies. More than anything, that’s why we are targeting this market.
The question is, which factor will win out in the end? Can you get traction in a sick market if your solution is the cure? Or, will the overall health of your customer’s business overwhelm the benefits of your solution?
When we started on this, I was sure our solution would win. Not because the solution is great (It is, of course), but because the problem is so big and such a massive problem. The big schools spend $100MM per year on online leads. 99% of those dollars are wasted. That’s a lot of cheddar.
After looking at all the data over the past 4 months, my conclusion is that sick market wins. This is unfortunate for us right now, but I think it’s true.
On average, for-profit schools are experiencing declining enrollments (5-10% per year), increasing acquisition costs (10-15% ouch!), increased regulatory pressure directly against marketing activity and significant layoffs.
Even if you have the greatest solution in the world, I think it’s difficult to imagine how you can overcome these obstacles. Your customer, the decision-marker serving as CMO or VP of Marketing, is scared for his or her job. They aren’t looking to try something new or solve big problems right now. They are thinking about their next career move. They are running for cover.
Market trumps product.
I’ve updated the Traction Stoppers framework to reflect some additional factors that can be big obstacles to getting traction.
Take a look and feel free to share your thoughts and feedback.
Is this framework valid?