20ish Minute Skill: The Concierge MVP - ITS Classic

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This Newsletter:

We’ll send it out with the podcast now - hope it’s helpful. Reply with things you’d like included in the future and forward to anyone who might enjoy the pod.

Also, early subscribers can get our weekly post sent to Tacklebox Members. Here’s last week’s: The Two Types of Customers - Survive and Grow. Reply “Sunday Email” if interested.

Why This Episode Exists:

Today’s episode is about the chicken and egg scenario you’ll hit around product early in your startup’s life.

You’ll need to build a product to get the type of genuine feedback necessary to know if your business has legs, but you need to get that genuine feedback to know if it’s worth investing in a product.

The way to navigate this, and what we talk about in the episode, is a Concierge MVP.

We’ve helped founders build Concierge MVPs for every type of business - from SaaS to neighborhood bakeries.

The key is the mindset shift highlighted in the episode - thinking about products as existing in specific moments, and figuring out how you can meet your customer in that moment and help them succeed. Without any sort of crutch.

Hope you enjoy!

-Brian

This Past Week

No idea if this will be a recurring segment in this newsletter or not, but there were a few things I bumped into this past week that were great and I felt like sharing.

1. One Day on Netflix. There are 14 episodes (20-minutes long), with each episode covering a year in the relationship of two people. It starts in the 80s, and each episode has music / clothing / pop culture from that year sprinkled in. The strategy for growth is great - describing the show is painfully simple which means it’ll grow. The theme is clear - will these two end up together? It’s a delightful show built to grow and I imagine you’ll hear about it 25 times in the next 2 months.
   

2. Second, Proof You Can Do Hard Things by Nat Eliason. I love a well-written kick in the butt.
   

3. The below quote by Seinfeld. I think there’s a pod coming on it. The most interesting people are the ones constantly collecting stuff. That requires you to surround yourself with stuff you’d like to collect. Seinfeld was lucky - his passion is everyday life. What’s yours, and how can you make it that easy to collect insights?

The References

• Tacklebox

• Idea to Startup Bot

Timestamps:

02:00 - The chicken and egg startup
04:50 - The value of a Concierge MVP
07:20 - The four steps of a Concierge MVP
11:00 - Example story of coaching service Concierge MVP
14:20 - Challenges with selling/positioning the Coaching MVP
18:30 - Learning from Concierge MVP results
22:45 - The End - Momentum

Transcript - Feel Free to Read it Like a Long-form Article:

Today we’re going to teach you a method that’ll help you attack the seemingly unsolvable chicken and egg problem all early stage startups have.

Or, think they have.

Here it is:

You can’t know if the product you plan to build will work the way you hope it will without sinking a bunch of time and money into it first. You’ve got to build the thing to see if it works.

But, you can’t sink in a bunch of time and money into building that thing if you don’t have time… or money. And the people giving you money - usually investors - want to see that the thing works before they invest. The thing you … can’t afford to build without them.

Chicken, and egg. Can’t build without funding. Can’t get funding before you build.

Lots of people reach this fork in the road and take one of two paths. Both stink.

The first path is avoidance. You recognize you’ll need more than you’ve got to raise money but you sort of go through the motions anyway, making a deck, going to a few events, maybe putting up a linkedin status or two. Eventually, you tell yourself it was just too hard to raise funds and your idea drifts away, like the tide.

The second path is chaos. You plunk down 10 or 20 or 40k or whatever's in your bank account and hope a development shop builds an amazing product that works. And while I appreciate the hutzpah, and frankly appreciate the word hutzpuh even more, the chuck it and hope approach doesn’t work and your time is way more valuable than that.

The details for your first product really matter and you won’t nail them without tons of intimate reps with your customer solving their problem. And the details I’m talking about aren’t design or breadth of features - those don’t matter at all. If you’re actually solving an urgent problem for someone, it can look like pure garbage and they’ll still use it. That’s one of my favorite signs of a promising market - if there are products that look horribly made but are still growing like weeds - there’s potential.

The details that do matter are exactly how and when your customer interacts with what you’re building, what they can do with whatever value you’re delivering, how they feel during the whole process, and how they quantify and describe the value to someone else after you’ve delivered it. That’s the important stuff. And, the hard stuff.

A great way to get those reps is through a concierge MVP, a method of delivering the value of a product without actually having a product.

The concierge MVP is exactly what it sounds like. You’re a concierge and you take your customer, manually, through your product. You solve their problem. Wherever you were going to have a product, instead, it’s just you.

This works extraordinarily well for validating all the critical assumptions that lead to a great product. And if you think it can’t work for your product… it can. We’ve helped founders do concierge mvps for everything from service products to direct to consumer CBD drinks to outdoor patio furniture to a freelancer marketplace.

And we’ll start… by telling a sad story about what happens if you don’t do this. Storytelling is all about setting the stakes. Here are the stakes. That’s also the name of my charcoal grill company we’ll talk about in a little bit.

In the early days of Tacklebox we had an incredibly talented team that identified an enormous problem: Retailers did a terrible job of predicting demand and pricing. Still do.

Our company looked to solve the problem through AI. Basically, they’d interact directly with a retailer’s customer base to get forward looking data on what they’d actually buy and how much they were actually willing to spend. Then, they’d combine that data with a retailer’s historical sales data to get a complete picture of what to make, how much of it to make, and how to price it.

Everyone loved the idea. The COOs and CROs of retailers leapt on board to join the pilot.

And the team, having a strong technical presence, built the tool they’d use in that pilot.

It surveyed customers, pulled in historical data, and spit it all out in a custom, beautiful dashboard.

Retailers would, hopefully, pay for the tool on a quarterly basis, starting after this free pilot was run.

The pilot ran, and the product worked as advertised. It did a much better job of predicting what to make, how much of it to make, and how much to charge, than the retailers had in the past. They saved tens of thousands of dollars with a tool that cost a fraction of that.

When it was time to sign contracts with the participants of the pilot, we assumed it was a formality. Of course they’d sign.

None did.

Why?

The tool didn’t fit in their workflow. Retailers worked in excel, all the time. Their data was in excel. Decisions were made through excel. Years and years of past data were in tabs in excel. The ordering, buying, and pricing process all ran through it.

But the tool our team built was a separate dashboard. There was friction to access it. You had to leave excel to do it. It was annoying.

And on top of that… the incentives to use it in the first place were off. What we’d thought would be a tool for merchants to get better at their job was seen as a threat by the merchants. They thought this tool, if it worked, would replace them. They weren’t entirely wrong. So, they didn’t use it.

Or, if they did, they certainly didn’t say it was responsible for the better decisions they’d made. That was all them, thank you very much. Their job relied on them predicting trends. So when they did, of course they’d take credit for it.

So when the higher ups - the same ones who’d brought the tool in to pilot - asked the merchants if it was useful, the answer was a resounding “no.”

Our company then tried to find smaller retailers who might get value from it. Companies without dedicated merchants, or with merchants who were severely overworked. But the way the tool was built, it needed years of historical sales data, and a certain amount of sales data. It didn’t work with smaller retailers.

The tool was rigid. The solution that was built didn’t solve anyone’s problem.

And that… was that.

A concierge MVP would’ve avoided this fate. We would’ve found a more flexible way to help a retailer forecast demand. We’d quickly realize, by watching over their shoulder, that anything outside of excel was untennable. We’d understand how the product made merchants feel. We’d maybe be able to navigate the systemic problems, but also might’ve been able to write it off with less investment.

Today, we’ll talk about how a concierge MVP can keep you from that fate, using a few ideas I simply can’t get out of my head that I hope you’ll run with… after… little smooth jazz.

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Concierge MVPS

We’ll start with two big questions we always ask…

• What’s it for?

• What’ll it help us do?

We’ll start with what it’s for. Three big, big things.

1. First, you’ll Validate the problem and customer.

2. Second, you’ll Understand what product needs to be built - when to help, how to help, and what the real value of solving the problem is. What it allows your customer to do.

3. And third, you’ll understand what your life would actually look like if you pursued this idea. This is criminally underrated. A concierge MVP is a window into the future - you’ll see how it feels to work with customers, where they need more or less support, what they believe or need to be convinced of, their scarcity and constraints, their questions, their emotions. All the good stuff you can’t get from the sidelines.

Overall, a concierge MVP exists to help us decide if this idea is worth our time.

Now, the second big question - what’ll it help us do. What’s the unlock?

The answer is, it gets us to the next level. If you want to raise money, it’ll help you do that. If you want to see the busineses’ potential, it’ll help you do that. It’ll make it clear the teammates you need and the advisors you need. It’ll give you real, actual momentum. Or, stop you dead in your tracks. Either way, it helps you make the go or no go decision.

The category shift from sort of working on an idea to the founder of X business that occurs once you run a concierge MVP is staggering.

Great. Moving on. It’s a 20ish minute skills episode so we’ve got to haul butt a bit here.

The Concierge MVP is a four step process. I’ll lay out the steps, and then I’ll tell you a story about two companies that ran through them. Hopefully it sparks something. Bing bang boom.

1. The first step is to identify the underlying hypothesis of your business. I like using this structure - If I can help X do Y, it’ll allow them do Z, which is so valuable that they’ll have to tell other people about it.

This is trickier than it sounds.

Let’s say I’m making a new kind of charcoal grill, and the reason I’m doing it is I love the razor / razor blade business model and think I can sell people charcoal on a subscription forever. And, if you can’t tell, I thought about this before. I told you the name earlier was here are the steaks, but there are a lot of mediocre steak puns I’ve been kicking around for the grill.. so far none of them have… stuck. Sorry.

Anyway, my hypothesis would be… If I can help people who love charcoal grills get a better grill, it’ll help them… grill… better… yikes it becomes clear very fast that I don’t really understand the problem, or the customer, and that the idea was about ME, not THEM. That… won’t work.

Alternatively, here’s a startup we’ve worked with that gamefies sales - If I can help Series A B2B SaaS companies measure, prioritize, and gameify the small tasks that lead to higher sales per employee, they’ll execute at a higher level and be able to raise a new round of funding. Better. Ready for a concierge MVP.

2. The next step is to dig in on the customer part of the hypothesis. The goal is to stack the deck. You want to make sure the customer you choose for a concierge MVP is the absolute best possible customer for you. Give yourself every chance to succeed. This way, there’s no excuses. If it doesn’t work, it means something is fundamentally wrong.

• This customer should already see the value, be looking to solve the problem already, have an urgent, painful, expensive, frequent, or growing problem, and, potentially, are connected to us already.

  • In the B2B SaaS example, this would be a customer who might already trying to gameify sales with their staff and is publicly gearing up for a fundraise - and thinks sales is the way to get there. Describe that customer, and target them.

3. The third step is acquiring these customers. Ideally, you’ve already got some. Don’t overthink this. They should come from your customer interviews, they should be the reason you’re starting the business, and hopefully you’ve already got relationships. This should be a warm email or a call, not a cold email.

But, if it has to be cold, use the hypothesis framework as you’re marketing. We’ll help you X so that you can Y. We’re launching a limited pilot and think you’re right for Z reasons. Respond if interested.

Remember the three most powerful words in the english language - I choose you.

4. Finally, create the plan for your concierge MVP. Replace the product in your mind with yourself. Focus on opportunities for feedback. The gold standard concierge MVP feels like we’re one of the detectives on NYPD blue looking through the one way mirror. We just watch our customers solve the problem, able to study everything they do.

So, the four steps of a concierge MVP:

1. Define the hypothesies

2. Pick the perfect customer

3. Find them if you need to

4. Deliver clear value

Now, let’s run through examples. As always, holler if you have an idea that you think is un-concierge testable. Email [email protected]. We can figure it out, and if it’s spicy enough, we’ll maybe do it on the pod.

On to it.

About six months ago a founder showed up on our doorstep with an idea for a coaching service that she’d sell to businesses. In her previous life, she’d been a coach in two different verticals - first, a career coach hired by individuals, and second, a health coach hired by private hospitals to help their patients post-treatment or diagnosis.

In both scenarios, she set up the core operating system for people’s lives. In both scenarios, she was blown away by the efficacy.

The first time we met, she told me, quote, “I think I’m a really good coach, but it’s not like I’m the greatest coach in the world. And yet, the people I work with make incredible strides once a system is in place. And, most good coaches get the same results. It’s not rocket science. You can teach coaches to get great results, and using a coach gets consistently great results… people just don’t do it.”

She went on to tell me the idea.

“Some businesses offer coaches to their employees once they reach a certain level - usually c-suite. But having coaches available for all of your employees would create astounding value.

We could standardize business things like meeting agendas and takeaways and also personal things like diet and exercise. Improving health and efficiency makes people happier at work, removes the perception of stress, decreases turnover and increases happiness. Coaching would be a company’s secret weapon.”

Wooo was I sold. What a pitch. Then, the problem.

“But, I don’t want to run a service business. I want to run something that can scale. I want to spend my time thinking up the coaching systems and implementing them. Tackling productivity and compensation and inter-office politics and exercise and all the topics I’ve been in the weeds with over the years. I think a lot of this can be done asynchronously, with smart follow up. But, I need like $100k to build out the app I want. And I can’t raise funding until I’ve got the app.”

Chicken, meet egg.

Time for a concierge MVP.

One of the questions I get asked about concierge MVPs is where, exactly, should they live. They’re definitely after customer interviews and pair best with a specific insight. It should feel like you’re stuck. Concierge MVPs are the crow bar that frees you up for momentum.

Here was this the concierge MVP for this entrepreneur:

1. First, her hypothesis:

If I can help Series B tech companies get access to a coaching system for all their employees, it’ll allow them scale faster, reduce turnover, promote internally, and increase employee happiness. This will be the single most impactful decision they make that year, and they will attribute a huge portion of their success to it - they will absolutely tell other companies about it.

2. Second, the customer. Quote - Series B tech companies, but deeper than that, companies that already implement coaching for c-suite executives and track employee happiness. These companies are hiring, growing, and can’t afford turnover. They believe in coaching, they just don’t think its available at all levels.

3. Third, acquisition - I’ve run interviews with a bunch and have warm leads. Sales will be direct via email and calls.

4. Fourth, and most interestingly, how would she deliver the value of the tech product manually?

This nearly always consists of pairing down the planned product aggressively. The flow she’d envisioned for the eventual product would be as follows:

• A monthly, hour-long 1x1 with each employee for a traditional coaching 1 on 1. We’d set goals, adjust previous goals, and flag any real issues HR needed to focus on.

• The coach would then have a tool that allowed them to prescribe the next month for that employee. The employee would be put on a plan with process and outcome goals around career and health, and have the ability to check in each day with how they felt and why. Reflection and consistent monitoring was the key. There would be short videos that popped up to take them through things like a 15-minute breathwork exercise at lunch or a prioritization exercise on Monday morning. On the back end, the coaches could watch progress and jump in if or when it was relevant.

The founder would step away from coaching and watch how customers interacted and make asynchronous videos for common problems.

The way to make this a concierge MVP is straightforward. The app just becomes the entrepreneur. She’d run the 1x1s with employees at the beginning of the month, then figure out exactly what she would’ve prescribed had the product she wanted to build existed.

If she decided that an employee needed a 15-min breathwork exercise on wed, thurs, friday, a prioritization check in on Mondays, a motivation text on thursday, friday and sunday, and reminders as to what a healthy lunch would help them achieve each day at 11am, she’d build that out.

Here’s how she’d do it.

She’d record the breathwork, prioritization, and other videos as needed. She’d then schedule them to be emailed over the next month using gmails “schedule send” function. Then, she’d schedule any text messages using Twilio. Finally, she’d schedule a survey on typeform to go out once a week seeing how the program was going.

These are all free or cheap no code tools you all could learn in less than 5 minutues.

Finally, to really close the feedback loop, she’d schedule extra, 15 minute check-in calls each Friday to make get more transparency into what was helpful and how.

Now that she’d outlined the concierge MVP, she had to try and sell it.

For concierge MVPs, there are two schools of thought around compensation. You can try to get customers to pay, which will give you some clarity around perceived value. Or, you can remove that friction and create specific goals for the pilot - you’re going to create these three specific outcomes, and if you do, the customer will sign on.

I think both are valuable. Feel out which situation is more likely to end up with you working in a meaningful way with the business. You won’t have any social proof, so when selling b2b you’ll often have to give away the pilot for free.

Our coaching friend went the free route. Right away, we realized how hard it was going to be to position the outcomes she’d hoped to deliver.

Getting calls was no problem. Closing free trials was a huge one. She couldn’t quantify productivity or lower turnover or higher retention, or happier employees, especially on monthly trials. Companies asked, how would they know happiness was solely attributed to coaching?

What metrics would they track? If it worked, and they had to pay, where would the budget come from? What was the category? HR? Wellness? Would this be covered by insurance? C-suite executives had budgets for their personal growth - the employees she’d target didn’t.

What…. was this?

Nearly every company said they’d rather wait and see how other companies did with the product. Then, they said, they’d happily pay. Once there were clear outcomes.

Luckily, one company signed on for a test. They had had great experiences with c-suite coaches and were intrigued.

They were a SaaS business that built HR software, so this also aligned with their core thesis. They decided to test it with three teams of 5 employees.

The entrepreneur executed for two months. This is getting long, so I won’t get into too many details. Just the important ones. The concierge product worked as planned. All the value a real product would’ve delivered, the concierge product delivered.

But… it didn’t really land.

Employees quickly ignored things like breathwork and prioritization and meal reminder pings. They stopped responding to surveys or answered with unhelpful responses like - quote - going well. They showed up to every 1x1 and repeatedly talked about how valuable they were and how they wanted more - but… we already knew coaching 1x1s worked. They weren’t scalable. That was the problem.

“People fundamentally don’t believe that coaching delivered via text or email can work, she said, making her final decision. They don’t see the value and they can’t quantify it. Coaching delivered one-on-one does work - everyone agrees - but it’s too expensive and the model doesn’t scale.

If I pursued this opportunity I’d spend my life trying to hire coaches, trying to convince people that something they don’t believe will work would actually work, trying to prove our value through crappy feedback loops, and consistently dealing with employee disengagement. And, I’d likely end up with a service model, which is not the business I want to run.”

One month of a concierge MVP in this space and she knew it didn’t make sense.

She quickly moved to health coaching at scale - a clearer problem with clearer outcomes and stakes. She’s running a concierge MVP there, with incredible results. She’s closing a funding round soon. That might be the one.

I promised another concierge MVP, but this pod is getting way past 20ish minutes, so if you want to hear about a concierge MVP for an outdoor furniture business sold direct to consumer, and get some more structure on tools to use for a concierge MVP and approaches that have worked, head to gettacklebox.com/podcaststuff and put in your email. I’ll send it over.

Concierge MVPs do a lot for you.

They help you understand what’s actually valuable.

They let you see, in real time, what the swap looks like - how your customers lives will change if they incorporate your product, for good or for bad.

They help you look into the future and see what your life would look like if you pursued the idea.

But, maybe most importantly, they help you do what most people won’t do.

And that’s where we’ll end.

I watched a documentary the other day on happiness. It was fine. Not good enough to recommend. But there was an interesting scene on bucket lists.

A survey had gone out to thousands of people asking them to make a bucket list - the top 5 things they wanted to do before they died.

Then, the documentarian followed up and asked a simple question - what are you doing now to make sure the thing at the top of your bucket list gets done? This is the thing you want to do most in your life, so… what’s the plan?

Person after person responded with some version of “you know what? I haven’t thought that far,” or, “you know what? I always just thought it’d be clear when the time was right.” In short, no one was doing a damn thing.

A specific interview caught my attention. One person had written “spend a month in Paris” as the number one item on their bucket list. When pressed as to what the next steps were, she said.. “I don’t know… I.. guess I could start by just picking a month? Like, maybe next June?” It was almost like she was asking the interviewer if that date worked.

“Sure,” the interviewer said. “Next June could work.”

The person’s eyes welled up with tears as they began to rattle off plans - what family members they’d invite, where they’d stay, how to book the rental, how much they’d have to spend, how they’d pay for it, the activities their grandkids could do. They fired off a big email in the moment, telling everyone to block their calendar.

The moment people learn what I do for a living, probably 90% of them say something like “My goal is to run my own thing in the next five or ten years.” Most of them.. won’t.

And I think this chicken and egg problem is the biggest blocker. It’s hard to see past. Until you know what to do, and then your dream becomes manageable.

The concierge mvp is a path to momentum. It’s the thing that can catapult you to the next step. It’s hard and uncomfortable and scary, but it works.

Most won’t do it. But, maybe, you will.