Ask Jason LIVE! Returns to TWiST! | E1905

Jason kicks off another Ask Jason with 6 live guests! (00:00:00)

• Jason introduces a new live Q&A format for Ask Jason, featuring live callers.
• This week's episode is sponsored by Lemon, Vanta, and LinkedIn Ads.
• Lemon: Offers vetted engineers from Europe to speed up product development without draining budgets.
• Vanta: Simplifies compliance and security for startups, making it easier to win new business.
• LinkedIn Ads: Provides a $100 ad credit to launch the first campaign.

Tommy asks about getting a degree in fintech in order to join startups (00:01:14)

• Tommy, a 23-year-old CPA, sought Jason's advice on pursuing a master's degree in fintech from the University of Missouri St Louis.
• The one-year program costs around $40,000, and Tommy aims to work in the finance sector of a tech startup.
• Jason advised against the degree due to the rapidly evolving nature of the industry and the potential misalignment of the curriculum with real-world practices.
• Instead, Jason suggested that Tommy gain hands-on experience by working in a fintech startup as a versatile operations person to learn various aspects of the business.
• To increase his chances of finding a job in a startup, Tommy should move to Silicon Valley, immerse himself in the tech scene, and network with industry professionals.
• Breaking into the startup scene involves attending events, networking, and starting a blog about startup accounting and finance.
• Practical experience and being part of the startup ecosystem are more valuable than a master's degree.
• Tommy should move to Silicon Valley with a one-way ticket and begin networking and working in the startup scene as soon as possible, even if it means accepting a low salary or working for free.

Lemon.io - Get 15% off your first 4 weeks of developer time (00:07:44)

• Lemon.io offers on-demand developers with 3+ years of experience and strong portfolios.
• Only 1% of candidates who apply to Lemon.io are accepted.
• Lemon.io handles the integration of developers into your team.
• Several Launch Founders have had positive experiences working with Lemon.io.
• Twist listeners get 15% off their first four weeks of using Lemon.io.

Sam asks about common mistakes for first time founders (00:08:48)

• To ensure a successful startup, founders should gather customer feedback before building their product, focus on a specific customer segment, and have at least two co-founders actively involved in product development.
• C AI, a startup founded by two co-founders, aims to provide an AI-powered sourcing and interviewing tool for recruiters.
• The tool offers analytics, a one-sentence summary of each candidate, and a link to their GitHub account for further assessment.
• The key challenge lies in determining whether the software can deliver the ideal candidate list or if the difficulty lies in scheduling meetings or qualifying candidates.
• Customer feedback can be misleading, so the startup is testing its product with early customers by requiring payment to validate its perceived value.

Vanta - Get $1000 off your SOC 2 (00:16:40)

• Vanta simplifies the process of obtaining and renewing SOC 2 compliance, which is essential for B2B startups that store customer data in the cloud.
• SOC 2 compliance is crucial for closing major deals, and Vanta enables companies to achieve compliance in just 2 to 4 weeks, compared to the usual 3 to 5 months without Vanta.
• Vanta offers significant time savings and cost reductions of up to 85% on compliance costs.
• In addition to SOC 2, Vanta automates up to 90% of compliance for GDPR, HIPAA, and more.
• Vanta empowers sales teams by removing compliance hurdles and enabling them to close deals more efficiently.
• Viewers are encouraged to visit v.com/twist to receive a $1000 discount on SOC 2 compliance.

Clint asks about startups surviving the period before VC investments (00:17:32)

• Jason's advice helped Clint's startup navigate challenges during its early stages.
• Startups that launched during the downturn face funding difficulties due to limited metrics.
• Jason suggests focusing on solving a specific problem, using customer love and data to attract investors, and maintaining a low burn rate.
• The AI Lean Startup methodology prioritizes affordability and product traction before fundraising.
• The "Zer" era startups prioritize fundraising over product development, leading to challenges when the market changes.
• A lean product team with a clear focus is more effective than a larger team with limited product builders.
• The founder oversees all aspects of the startup, while the Chief Product Officer handles product development and design.
• The app, Capsule CIP, provides a private space to capture meaningful moments and has acquired 1,300 users, with 380 active users and 40 subscription conversions.
• The app's subscription model is inspired by Jason's app, Points of Social.
• The speaker proposes a "Capsule Pro" version with additional features and services, targeting Gen X parents who want to preserve memories for their families.
• The founder should focus on understanding customers and showing growth to raise money.
• The product may be a niche product, making it challenging to attract venture capital funding.
• The founder needs to find a way to attract millions of daily users or tens of thousands of users willing to pay hundreds of dollars annually for the product's success.
• The founder plans to focus on vertical video as the preferred format for capturing memories.

LinkedIn Ads - Get a $100 LinkedIn ad credit (00:33:12)

• LinkedIn ads can be effective for B2B marketing as the platform has over a billion users, including 180 million senior executives and 10 million C-suite executives.
• LinkedIn's ad platform generates 2 to 5x higher return on ad spend compared to other social media platforms.
• People on LinkedIn are there to do business, making it a suitable platform for B2B marketing.
• To claim a $100 credit on your next LinkedIn ad campaign, visit linkedin.com/thisweekinstartups. Terms and conditions apply.

Daniel asks about startups pivoting in the wrong direction (00:34:23)

• Jason's successful SEO strategy for Mahalo generated $10 million in annual advertising revenue before Google's Panda update caused a significant loss of traffic.
• Despite the initial success of Mahalo's YouTube channels, Jason missed out on the platform's massive growth due to his lack of interest and the revenue-sharing model.
• Hey Hire, a portfolio company, faces a dilemma: focus on a potentially higher-revenue opportunity in last-minute staffing for catering companies or stick to their proven but lower-revenue core business.
• Point, a survey tool that pivoted to become a petition platform, demonstrates the importance of listening to customers and adapting to changing market demands.
• The team is divided on whether to focus on the existing business or explore a new adjacent business opportunity in catering, which offers advantages such as larger ticket sizes, higher pay for workers, and the ability to leverage the existing customer base.
• Pricing for the new catering feature should be set strategically to capture the top 20% of customers and ensure profitability from the start, with potential models including annual licensing fees similar to competitors.
• The ideal customer profile is someone in the catering business making $1 million per year, whose most painful problem is finding staff, often using gig platforms that charge double or triple the hourly rate.
• The proposed solution is a platform that connects caterers with staff, allowing them to pay and onboard staff as they wish, with pricing options such as $500 per month for up to 10 job postings or $1,000 per month for a six-month subscription with more personalized service.
• The platform should be positioned as a high-powered solution for million-dollar catering businesses, excluding smaller operations.

Greg asks about raising funds before product-market fit (00:46:54)

• Before achieving product-market fit, investors prioritize the team's composition, including the number of co-founders, previous venture capital raises, successful exits, world-class design, product velocity, and prior collaborations.
• Seed funds and angel investors are more likely to invest in startups based on these factors, with potential checks ranging from $25k to $250k.
• Being located outside major tech hubs like Silicon Valley, New York City, or Austin makes it more challenging to secure pre-revenue funding. To increase their chances of success, founders should aim to launch their product, acquire 10 customers, and outperform their counterparts in major tech hubs.
• Joining a top accelerator or incubator can serve as a validating proof point and provide access to potential investors. However, the competition is fierce, with acceptance rates ranging from 1% to 9.5%.
• Ultimately, successful fundraising often hinges on positive customer feedback and validation of the product.

Oliver wants to know if it is better to go deep with a few customers or gain entry to multiple customers with a more lightweight solution (00:52:30)

• The company is considering targeting either real estate agents or brokerages with their software solution. The total addressable market (TAM) for agents is estimated to be around $72 million per year, with potential for growth up to $350 million, while the TAM for brokerages is estimated to be around $180 million per year.
• Targeting brokerages may be more defensible in the long term due to lower churn, but it would require a sales team and an onboarding process, while targeting agents would require a high-volume marketing approach.
• Oliver, the founder of an AI company targeting high-end brokerages, shared his experience and insights during an episode of "Ask Jason LIVE! Returns to TWiST!" and is considering expanding to target smaller clients.
• Jason advised Oliver to focus on the high-end market, as it offers greater potential for revenue and scalability, and to validate the demand and seriousness of potential clients through strategies such as offering limited pilot spots, requiring upfront payments, and setting a higher price point.
• Jason emphasized the importance of networking and collaboration among founders and introduced "Founder Fridays," a new Meetup program hosted by founders for founders in various cities, to facilitate this.
• Founders can sign up and host meetups in their cities through the "this week in startups.com/meetups" landing page.