Uri Levine: belief

Transcript context

…So initially you think about your new idea from multiple perspective, right? This is the problem. This is how this solution is going to look like. This is what I'm going to do next year. This is my 10 years vision. This is my business model and so forth. So you think about everything, but you actually need to execute only one thing. Now this one thing is figuring out product market fit. It's not one thing, right? Wait a minute. You also need to build an organization and you want that organization to be something that you really like and so there are a lot of operational stuff, but you need to figure out product market fit. As we said earlier, if you don't figure out product market fit, you will die. If you do, then you get to live and die another day and the other day is whether or not you're going to figure out how to grow your business and whether or not you're going to figure out your business model. Now the good news is that I will tell you that if you create value, you will figure out a business model, at least for the people that you create value for them. They are most likely willing to pay. Now in general, I'm not saying that this is the only business model that is viable, but if you create value, you will figure out a business model. But figuring out a business model is a journey by itself, and guess what? It's going to be a long roller coaster journey of failures. When we started Waze, we thought that we're going to sell map data and traffic information and we ended up with doing advertisement. Very different business model. Because we realized that it's not for us. It's too long sales cycles. We were very mobile internet dynamic company and selling to government is not exactly what we wanted to do, and so we ended up with a different business model, but with a lot of reasoning why this is the right business model for us. And figuring out growth, look, if I would ask a hundred people on the street, how did you hear about Waze? They, 95 of them, if not 99 of them, will tell me, "Someone told me." Word-of-mouth, right? So everyone wants to have word-of-mouth. Word-of-mouth you can only have if you have high frequency of use. If you're doing tax returns once a year, even if you really like the experience, then once a year you're going to tell someone else. If you're using Waze every day, then every day you have an opportunity to tell someone else. So word-of-mouth, even though that everyone would like that, it's only going to happen if you have high frequency of use. So those phases requires different focus of the company, right? Initially if you focus on product market fit, then you don't need sales. You have no product to sell. You don't need business development. You don't need even marketing. You need product. You need developers and you need product lead to define the product and lead through the iterations of the product until we get to the level that it's good enough. Once you get there, you shift gears. You need developers and you need product lead to define the product and lead through the iterations of the product until we get to the level that it's good enough. Once you get there, you shift gears. If the product doesn't change, if we search Google the same way that we searched Google for the first time in our life, then the product development is now not going to be focused about value creation. It's going to be focused about either figuring out business model or figuring out scale, and the entire company shift gears and move to a different phase. Now, this is really hard. Just think about it. If up until now the product development group was the only things that matters, all of a sudden we think about marketing now because we are now in the go-to-market phase that this is the most important thing of the company. Occasionally I found companies that have challenging and shifting gears so they didn't figure out where the clutch is and you have to because otherwise you're stuck in the previous phase that you kind of finished that journey. This journey is nearly done and you need to shift gears, and if you don't do that, then you get stuck. If you do that, if you try to do multiple things at the same time, you will fail. Focus is not about what we are doing, it's about what we are not doing. These are the hard decisions. I like that. So the four phases, just to briefly summarize, it's kind of like come up with the idea, find product market fit, then it's a question of should you keep focusing on growth or should you figure out the business model before focusing heavily on growth? In your advice, it sounds like if it's high frequency, word-of-mouth driven, focus on growth and then you figure out business model later. If not, figure out how you're going to make money and then figure out growth.…

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