How to Get Your First Customers: Advice from a YC Partner

Video Summary

In this video, Gustaf Alstromer, a partner at Y Combinator, discusses how early-stage startups can effectively go from talking to users to getting their first paying customers.

Key Points:

• Founders must be willing to do "things that don't scale" in the early days, like manually recruiting and onboarding customers.
• Founders should learn how to do sales themselves, as it helps them understand their customers and product better.
• The sales funnel (prospecting, demos, pricing, onboarding) is crucial, and tracking conversion rates at each stage is key.
• Charging customers from the start is important, as free trials or pilots don't establish real customer relationships.
• Working backwards from sales goals and improving the process based on data is critical for success.

Insightful Ideas:

• Startups don't take off on their own - it's the founders who make it happen through determination and effort.
• Sales should be part of the founder's DNA, just like engineering, to truly understand customers and the product.

Actionable Advice:

• Founders should be the ones doing sales in the early days, rather than outsourcing it.

The Art of Winning Over Your First Customers as a Startup

As an early-stage startup, one of your biggest challenges is acquiring those critical first customers. In a recent Startup School talk, Y Combinator partner Gustaf Alstromer shared invaluable insights on how founders can effectively go from talking to users to getting their first paying customers.

Alstromer, who previously led growth at Airbnb, emphasized that startups don't take off on their own - it's the founders who make it happen through sheer determination and hands-on effort. He argued that the "do things that don't scale" mindset is essential in the early days, as founders must manually recruit and onboard customers, rather than relying on growth hacks or automation.

"Startups don't take off by themselves. Startups take off because founders make them take off. And you have to manually recruit your customers," Alstromer explained. He cited examples of successful founders like Airbnb's early team, who personally reached out to their initial customers to understand their needs and sign them up.

A key piece of advice Alstromer provided is that founders should learn how to do sales themselves, rather than outsourcing it. "Just like you can't outsource engineering, sales has to be part of the DNA of the founders," he said. By handling sales directly, founders can truly understand their customers and their product, which informs how they build and sell it.

Alstromer also detailed the critical steps of the sales funnel - prospecting, demos, pricing, and onboarding - emphasizing the importance of tracking conversion rates at each stage. Working backwards from your sales goals and understanding where you're losing potential customers is crucial to improving your process.

Furthermore, Alstromer strongly recommended charging customers from the start, rather than offering free trials or pilots. "If you don't charge your customers, they are not a customer, and you don't have a company," he said. Paying customers demonstrate real value, which is essential for a young startup.

Ultimately, Alstromer's message was clear: in the early days, founders must be willing to get their hands dirty with sales and customer acquisition. It may feel uncomfortable, but it's the key to building lasting relationships and a successful business. By embracing this mindset and following the practical steps Alstromer outlined, founders can set their startups up for long-term growth and success.