Twitter used to be a crappy idea – 3 lesson learned.

werdelin

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twitter.com - Site Info from Alexa-3

The attached graph from Alexa is really interesting on many levels. It shows twitter.com traffic for the past few years. Twitter started in March 2006 and although the graph only starts in 2008, it’s fair to assume that the traffic was flat from 2006-2008. So what can we learn from this?

1. There are two ways to get market-fit – both require lean companies.

a) you can either keep on innovating your product until you nail a set of features that users like today, or

b) you can keep your product alive for long enough for the market to change û making your product relevant.

Lesson learned: Keep it lean.

If you look at the graph it’s clear that that from 2006 to 2009 Twitter was a pretty crappy company by all traditional measurements. The service had very little market traction/traffic and people didn’t really seem understand what to use the platform for. They could have led the company along either of two paths. Had Jack Dorsey read Steven Gary Blank‘s book he might have attempted to change the product into something that had more ‘market-fit’ by using customer development . This is the idea that you keep your company lean and continuously iterating your product until you find something that your users really like and this results in great market traction. Jack didn’t do that. He kept the product pretty much as is. So if the product didn’t change it seems the market changed around it  – resulting in dramatic growth in the start of 2009. The secret to this change is probably found in various places: from Facebook teaching the mainstream audience about the power of status updates, via Twitter’s role on CNN during the Iran election conflict, to increasingly developers understanding the use of apps making Twitter available on mobiles, desktops and websites. What’s key however, is that Jack and his team kept the service alive long enough for the market to adapt to their vision. This could only be achieved with endurance and some kind of secondary revenue stream for the team who worked on Twitter.  So if you are doing your own new innovative start up, make sure you keep the cost LOW û it’s the only way for you to have time to change your product if it doesn’t work right away,  or for you to keep working on it for the market to change so your vision is aligned with the users.

2. “Invest (your time/money) in products that you enjoy , and with people you like to hang with”. (quote Martin Varsavsky at SeedSummit)

Lesson learned: Build cool stuff with awesome people (both staff and investors) because you are likely to be stuck with them for a while.

It’s very seldom that projects are successful from the start. If you look at most companies that today are considered hits, they all had long initial periods where people didn’t ‘get’ what they were trying to do and more often than not ran for years with little traction. It’s stressful and emotional building a company, especially in those period, where your company narrative and product is not locked down. As an entrepreneur, you often fear that you will run out of money and lose respect from your peers/friends if you can’t make your start up successful. The truth is that your start up is more likely to fail than it is to succeed. So make sure you enjoy the journey. This is very much easier if you are around nice, funny, intelligent people with passion and empathy. Find those and the journey, no matter if it leads you to success or not, is better. Think of that, when you’re hiring/partnering, or choosing people to finance you. I don’t know the Twitter team and have only met Jack once. However, from what I read and hear from friends who know them, they seem to have gathered a fine selection of staff and investors that are likely to build a solid company as well as being nice to hang with. This is most likely part of the story that kept them going during the 3 years where few thought highly of Twitter.

3. Your timing is as important as your product – and people really dont know what will work a few years in the future.

Lesson learned: Don’t worry that much about what the blogs say about your newly launched product – they are probably wrong and things online can change very rapidly.

The web is really a great place on many levels. Small things change and suddenly a bad idea/company becomes a great idea/company. Admob.com was not really that big a hit – until the iPhone came around; many felt that Playfish could never build a real business as a ‘plugin’ to a site like Facebook – until they did; and Twitter was widely considered a silly idea when it came out – until 2009 when it really kicked off. Changes in the internet ecosphere create disruptions all the time – and companies become big on the back of those. So when people doom your product/business to success or failure, take it with a grain of salt. The web changes all the time and what was a silly idea one day can very easily be a great idea the next.

Any other lessons ?

@werdelin

19 Comments

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  • joelandren
    December 13, 2009 at 5:09 pm

    The problem is that for every Twitter there are hundreds companies that plug away for many years and don't reach 1/10th the success. They are equally lean, they build cool stuff and work with awesome people but after a certain point they (and their investors) are throwing good money after bad.Even if you're not growing users at a fevered pace their are metrics to let you know if you're moving in the right direction:Conversion: Are most of the users coming in through your acquisition channel converting?Upsell: Are people paying cash money for your product?Retention: Are your experiencing a low churn rate?These should be indicators towards future success. Plugging away for 3-5 years with belief in your great idea w/o any postive external feedback (and expecting a Twitter-like success) is foolhardy.

  • gordonmattey
    December 13, 2009 at 11:24 pm

    you should do some lessons learned at Joost 🙂

  • Bevan Bird
    December 14, 2009 at 3:49 am

    Henrik, I like this perspective that you have the choice to change to fit the market, or wait long enough for the market to appreciate the product's new-found usefulness. Good comment on indicators, Joel.

  • Nikolaj Nyholm
    December 14, 2009 at 7:28 am

    Henrik, great post. I would, however, be a bit concerned about using specifically Twitter as a case: * If you look at the traffic data more in detail, Twitter was never struggling but had nice growth in the early years. In 2009 growth EXPLODED dwarfing the early growth. So yes, Twitter was crappy then compared to now, but not crappy-crappy. * Twitter was making a splash in the Silicon Valley techie crowd way before 2009. Validation was clear already quite early and companies were copying Twitter's status updates, from Plazes and Jaiku through to Facebook. * As you point out, Twitter was all about changing the public perception. Usage/attention per user was high already in the early days, something that's often not the case for many companies.If I were to counter with some lessons it would be: * Recycle: what someone can't make work, others quite often can. Case-in-point for me was open sourcing OpenWRT when we closed down Organic Network. Four months later Martin Varsavsky & co picked this up and created Fon. Did they steal an idea? Not a chance. They made something work that we for several reasons couldn't. * Network effects: Make sure that the network effects don't just work for your site, but for the users. A very simple thing about Twitter is that users are more motivated to tweet if they gain followers.

  • Loser1
    December 14, 2009 at 11:39 am

    “Don’t worry that much about what the blogs say about your newly launched product – they are probably wrong”They weren't wrong about Joost

  • werdelin
    December 14, 2009 at 12:31 pm

    the blog-post has been in the making for months I'll get it posted when its done. 🙂

  • Shyam Subramanyan
    December 15, 2009 at 8:49 am

    Another lesson…keep things simple. Additional features are not the answer to a successful product or market adoption. Twitter pretty much stayed with the same feature set until recent past.

  • facebook-604550044
    December 15, 2009 at 12:46 pm

    I think 2009 was when twitter Crossed the Chasm into the mainstream. Customer Development AFAIK doesn't advocate changing the product, instead you should avoid scaling (keep it lean) until you find the early adopter market to fit the product. Then figure out how to cross the chasm. From the outside, twitter appears to have done exactly this.Your lesson to keep it lean is spot on, but please don't advise keeping it lean & hoping the mainstream market finds you.

  • Benjamin Yoskovitz
    December 15, 2009 at 1:56 pm

    Twitter is a good example of staying lean and your lessons are definitely worth reading and understanding.But one point: I don't think Steve Blank would recommend constant development and iteration of functionality trying to find a fit. My guess is that he would have recommended that Twitter point itself at different markets, keeping the functionality the same, but finding markets or applications that wanted to use it.And in fact, that's kind of what happened with Twitter, although I'm not sure how active Twitter was with that. But Twitter took off in part because people found useful applications for it — such as reporting from events (thinking about SXSW as an example). That application of Twitter got people “seeing a bigger vision” and helped it scale.I do think, given the opportunity, Steve would have tried to go through a more rigorous process from the outset with Twitter, but I don't think that would have involved constant feature development.It's not about “building more stuff” it's about finding a customer for what you already have.

  • ErnestS
    December 15, 2009 at 6:17 pm

    It probably has more to do with the Crunchies: http://bit.ly/8jEx7G

  • facebook-604550044
    December 15, 2009 at 6:46 pm

    I think 2009 was when twitter Crossed the Chasm into the mainstream. Customer Development AFAIK doesn't advocate changing the product, instead you should avoid scaling (keep it lean) until you find the early adopter market to fit the product. Then figure out how to cross the chasm. From the outside, twitter appears to have done exactly this.Your lesson to keep it lean is spot on, but please don't advise keeping it lean & hoping the mainstream market finds you.

  • Benjamin Yoskovitz
    December 15, 2009 at 7:56 pm

    Twitter is a good example of staying lean and your lessons are definitely worth reading and understanding.But one point: I don't think Steve Blank would recommend constant development and iteration of functionality trying to find a fit. My guess is that he would have recommended that Twitter point itself at different markets, keeping the functionality the same, but finding markets or applications that wanted to use it.And in fact, that's kind of what happened with Twitter, although I'm not sure how active Twitter was with that. But Twitter took off in part because people found useful applications for it — such as reporting from events (thinking about SXSW as an example). That application of Twitter got people “seeing a bigger vision” and helped it scale.I do think, given the opportunity, Steve would have tried to go through a more rigorous process from the outset with Twitter, but I don't think that would have involved constant feature development.It's not about “building more stuff” it's about finding a customer for what you already have.

  • ErnestS
    December 16, 2009 at 12:17 am

    It probably has more to do with the Crunchies: http://bit.ly/8jEx7G

  • timgauthier
    May 9, 2010 at 8:08 pm

    You're incorrect with the e-book statement, in that the ipad will read all of your kindle books just as easy as your kindle, via the app.