EP8. Building UX Products with Impact! Interview with 4-time Entrepreneur Steven Cohn
Steven Cohn is a father, husband, and serial entrepreneur and he tries hard to be great in all those areas. I can relate to that as I'm the father of two as well and husband to my wonderful wife of 10 years. I do hope to be an entrepreneur again in the future. Which is why I'm talking to Steven today. He has a marvelous track record of starting and selling fantastic digital companies.
For those of you in the UX space, many will know his venture, Validately which made it easy and affordable to conduct lean customer research on new digital products. Validately has since been acquired by UserZoom. Prior to launching Validately, Steven sold his first two startups to LivingSocial and TripAdvisor. He has also worked at DoubleClick, Quantcast, and IBM. He is a graduate of George Washington University and Harvard Business School.
I'm convinced that every designer dreams of starting their own product one day. I will not be shy about saying that I have this dream. So one of the great things about starting a podcast is that you get to talk to really cool people who do the things you want to do. So I'm really excited to talk to Steven today as he's 3 for 3 in creating useful, successful, and profitable products.
Steven is going for his fourth startup success with his latest and greatest company, ImpactProduct. ImpactProduct helps designers and product people alike make data-informed design decisions. Uncover usability issues faster. All without developer support. The entire tool is offered as a chrome extension. I installed it on my personal site. It took all of seconds to install and seems super easy to use thus far.
Follow Steven on Twitter @spcohn or learn more about him on LinkedIn.
Here is a list of people and products we discuss in the show:
Becky Buck of Forge Studio
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Now let's go create!
Here is the transcribed conversation.
Thomas Morrell Hello and welcome back to the user flows podcast, my name is Thomas Morrell and I'll be your host. UserFlows podcast is a place where we talk about UX design and careers. Today's gonna be a little bit different. We're talking to a founder. Steven Cohn is a father, a husband, and a serial entrepreneur, which is why I'm talking to Steven today. So Steven has a marvelous track record of starting and selling fantastic digital companies, for those of you in the UX space. You'll know his last venture Validately, which made it really easy and affordable to conduct lean customer research on new digital products, Validately he has since been acquired by UserZoom, and prior to launching Validately Steven sold his first two startups delivering social and TripAdvisor, so he's three for three on growing and selling very successful companies. He also worked at double click Quantcast and IBM so he was a perfect person to talk to. He is a graduate of George Washington University and Harvard Business School.
Now, I'm convinced that every designer dreams of starting their own product, one day, and I'll not be shy about the fact that I have that same dream. So one of the great things about starting a podcast like this is you get to talk to really cool people who do the things that you want to do or have done the things that you want to do. So I'm really excited to talk to Stephen today as I said he's three for three in creating extremely useful successful and also profitable products.
Steven is going for his fourth startup success with his latest and greatest company ImpactProduct. ImpactProduct helps designers and product people alike make data-informed design decisions, uncover usability issues faster, all without developer support the entire tool right now is offered as a Chrome extension, I installed it on my personal site, it took all of seconds to install and seems super easy to use, thus far, so it's a great conversation. I cannot thank Stephen enough for sharing all of his wisdom, as well as his time with us today. And here's the conversation. Enjoy.
Ladies and gentlemen, thank you. Today I have Steven Cohn, on the line, and Steven is a father, husband first, and a serial entrepreneur as well. So Stephen is the founder of Validately, which was acquired by UserZoom, and I believe that's how we got connected. Originally, I think I was trying to get Validately installed in a company I was working at, and you've been very gracious to accept this request to talk so you also have a new product coming out. ImpactProduct, which I just installed on my personal site. Really simple, easy to use, looking great so far so we'll definitely get into that. Could you just give us a little background into, you know who you are and what you're doing?
Steven Cohn 3:15 Yeah. Yes, so my, as you said my kind of my personal motto is I try hard to be a great father, husband, an entrepreneur, that's my, my pecking order. And so I'm a four-time entrepreneur, business-wise, my last company was a user research, UX testing platform called Validately, where I started from, you know, just myself and a couple of developers and then my co-founder, Mark back who joined shortly after we got started. And, you know, very scrappy product focus founder, I've, you know, just have a process that you know I follow I focused on building products, trying to understand customer needs, and you know I keep doing it because I love it. It's my favorite part of a business is just building, building products that customers love.
Thomas Morrell 4:12 It's fantastic. It was, you know this, always the kind of dream from the beginning, or is this something you stumbled into.
Steven Cohn 4:18 Yeah, great question. Um, actually my, my, I, my grandfather was a great entrepreneur. And my father was, was a longtime entrepreneur as well, had some successes as well. And so growing up, I really always had the perspective of a business owner and entrepreneur, neither of them were in technology. But, but still kind of the same kind of concept of, of trying to build a great business without a great product, bringing it to market finding customers, all that stuff so we used to talk about it when I was younger and I always thought it was an awesome thing. And so I always knew I wanted to be an entrepreneur be a business owner at some point. And, but early in my career, I did some other jobs set to basically learn some basic skills, the important skills that I thought would be helpful for me as the founder one day. And then in 2006, I finally took the plunge my first startup.
Thomas Morrell 5:20 Fantastic. And what do you think those skills were what are the most important skills you think to be a founder.
Steven Cohn 5:28 Well, so there's, they're soft skills and hard skills I think the soft skills are probably the most important. And, you know, I think my perspective, you know, look, there's no one answer to this, this is my perspective, what I believe, based on my experience what I think works. So first of all, I have a saying, when it comes to startups, which is every problem your startup has every question your startup has the answer is a problem. Right, so whatever it is if you're not growing fast enough, its product if you're not, if your cost of user acquisition, too high, its product is not marketing if your sales cycle is too long or conversion rate is too low its the product. If, if, if you're if your churn rate is too high it's product etc so I believe deeply that the core of successful technology startups and probably extends beyond technology comes back to product and really understanding product culture, what it means, what production means, what a product focus organization means and prioritizing that understanding that I think discipline is an extremely important to focus is extremely important. I am relentlessly focused ruthless focus is the phrase I use it to the point where even if you have a really good idea if it's off-topic, or cut it off, I'll just cut it off and say, great idea, not, not where we're going, let's, let's park that for later. I'm not trying to be dismissive but I don't want to chase this shiny object over here, I want to stay focused on solving this problem. So, so focus. And one of the kinds of biggest lessons that I've learned. Then, you know, and it kind of dawned on me, in my, in my early days of Validately we were struggling, was I used to think when I was an early founder that it was all on me. If I had to come up with the answer. I had to come up with the right thing for marketing or the right thing for a product or the right thing for sales or the right answer for all this stuff. And the thing that I kind of learned, and it became magical, you know, kind of learning moment for me was actually my job as a founder is not to always come up with the right answer is to create a culture an environment where the people feel my team feels connected to what we're doing, knowledgeable about what we're doing, knowledgeable about where the businesses, and what we're trying to do with the business and empowered to try to, you know, solve the business problems, you know, by them on the, on themselves without the founder, giving them the answer. And so I, once I realized that I basically built my, my team and my culture, with my product around that kind of philosophy of empowering teams, to, to solve problems and to know the outcomes of their problems of their efforts, good or bad, and have this kind of learning experimentation culture, and, and that was the biggest thing that I kind of, you know, learn, and that's helped me be a multiple-time founder.
Thomas Morrell 9:16 Okay, love it. And I did see that you had gone to Harvard, as well, the business school, right. Yeah. Do you feel like going into being a founder, is that does that help or did you learn a lot more just, you know, starting these companies.
Steven Cohn 9:36 So, it's actually it's a great question and it's a, it's a hot topic, everyone has an opinion on business school whether the business school or not, I can tell you for me personally, everyone's different. I loved going to Harvard Business School, I think I learned a ton. I think I don't want great connections that have helped me throughout the business and be more successful. I learned a lot about the product strategy and corporate strategy that we've had which are lessons that I've applied. In all my businesses and my, my fundamental, foundational thinking about, about starting a company. From my perspective for me personally, it wasn't, it wasn't, you know homerun experience, but it's not for everyone, and everyone, and there's no one path to success, there are many different paths to success. So for other people it might not, it might not be there might be other people who say I went to the school and it wasn't really helpful for me personally, I had a great experience and it's helped me.
Thomas Morrell 10:36 Fantastic. Okay, and that's I often wonder, you know, maybe I need to go back and I think a lot of people out there wonder the same thing, whether they should just to march forward with their idea or, you know, first go get some schooling, so I appreciate that. And getting back to you had mentioned the focus, kind of knowing when to move forward with an idea, or when to put it on the back burner. How do you validate between or determine whether it's a great idea that, you know can possibly be successful or whether or not it's just another idea? What's the kind of process for that.
Steven Cohn 11:10 It's a great question. So, whenever I start a company. The thing that I focused on. And a guy named Dan Olson, who wrote a speak spoke a lot, has written a book books on this. I think this book was the Lean product playbook and he's, he has a phrase that I steal a lot which is that there's, there's the problem space and the solution space. And I think one of the biggest mistakes that first-time founders make is usually first-time founders because they learned this the hard way and then they don't make this mistake again. If they jump right into the solution space, they think about a problem, and they don't fully understand it and they jump right into this beautifully designed solution, and they spend a whole lot of time building this really beautiful thing that no one needs, and it's beautiful and it's amazing, and all their friends say it's awesome. But then, no customers actually use it. And, and the reason why that is is that they didn't fully understand the problem space. And so when I start a company. What I try to do is deeply, deeply understand the problem space I spend, I spent a ton of time on that and it's the same thing when I'm not just when I'm watching new products within, within my prior company Validately for example, you know, or my new company. Because whether it's new features or new companies, it doesn't matter the same approach. I do a tremendous amount of user research to try to understand the problem space. And why this problem exists how important it is to solve. And why did the current products in the market, not solve these needs. And in a lot of, in some cases they'll say Oh I didn't know about this product, this actually looks like it does solve my needs, and then they say okay, maybe there's not an opportunity here. But in a lot of cases, when you talk to them and they'll say yeah we've tried that product, It didn't work for us, we tried this other product didn't work for us. Great. Why not tell me why not, why is this not working, what are the what is blocking. And if you do that enough, you'll find that you know you'll really deeply understand the problem space. And then once you want to get that once you really think you understand, then the process is, you know, a series of prototyping and prototype testing for validation. I say there are three levels of validation that I apply to understand if I'm working on an important problem, and if the solution that we're working on
Steven Cohn 13:54 is going in the right direction. The first level is your time commitment, so I will have a hypothesis of who my customer is, I reach out to those, those personas, on LinkedIn. LinkedIn has a great kind of targeting. And I send them a very basic message Hi I'm Stephen Cohen, I'm a multiple-time founder, and I'm starting a new company to solve this problem. I'd love to talk to you about it if you're interested. And what I have found with that basic message is, especially I do it through LinkedIn because then they can seem like I'm not some spammer like I'm like a real person that went to Harvard Business School like legit human and, you know, not just, you know, some, you know, spam farm, and, and I'm trying, and I'm a multiple-time entrepreneur and they can see that I have some credibility there and that, and they're like, actually this is a problem. And so the first thing I want to know is, is this a problem, significant enough from who I think is my target customer that they're willing to spend 30 minutes of their time talking about the current problem. Right. And, and I have found that process to be very successful. The next level is if they say yes there's a problem, and then I can show them a prototype. The next level is. So time, then there's social because social so social proof is getting that person taking the next steps whether if it's a b2b product internally taking the next steps if it's a consumer product, potentially other friends, but to get that software installed, to get that software employed within your product within your company. Okay, so to do that you got to put your credibility on the line, you got to go to legal to get approval for it, you got to go to your boss to get budget for it or whatever is right. No, if they, if, if they answer my LinkedIn cold, outreach, and they take, they take a meeting with me and then they see a demo of a solution even if it's a prototype, And if it seems like it's moving in that right direction where they feel like there's value creation for a true problem that customers will absolutely, even with just a prototype, we'll take those next steps to be a beta partner for you, because they, the pain is so great that this thing, if it works, if you can actually make the software to do what this prototype does awesome homerun like it really solves a problem. The third. The third level is budget. So I asked him for his time. I asked him for your social proof. And then I asked you for the budget can you commit to spending money on this is the price point, when we go live, this, you'll have, you know, a trial period. Beyond after that trial period, this is the price can you commit to paying these prices, depending upon delivery and a successful pilot. And I think one of the mistakes entrepreneurs make is they don't ask they'll talk about the price they don't talk about budgets, early enough. So I think you want to talk about that upfront, you want to understand if this is this $1,000 A month problem $100 A month problem, a $10,000 a month problem like how big is this problem for you. And that's important because that determines your go-to-market strategy that determines your scalability capital raising all that stuff. So those are the three levels I start I first I dig deep into the problem space, understand it. I use people, I ask for people's time, then I ask for their social proof. And then I ask for the budget. And I do all that, even with early-stage prototypes are very basic, you know, work you know very basic kind of alpha version of a product.
Thomas Morrell 17:32 Okay, fantastic. And so you mentioned something really interesting which I haven't seen many people do and that's the budget aspect. How do you go about coming up with a range of where you even price a product like this like when its just prototype stage is just trial and error.
Steven Cohn 17:50 Yeah, great. It's a great, great question. I love the conversation of pricing, from my perspective pricing is probably the topic that the the one thing in business, that is the easiest thing to change and has the biggest impact on your business metrics like, it's just amazing because there's like no developer support needed right you just change a number on a website right it's super easy. If you have Stripe. You know you can just change it in the UI. So, but, okay, so how do you figure out the pricing so first of all, you know, you can start with looking at compact competing solutions and where they are. You want to understand pricing but there's, there's a great blog on pricing called price intelligently. And I think they actually just rebranded a little bit but easily price intelligently and, and they talk a lot about a thing called a value metric. So a value metric is a, a, ay, ay met a usage metric that as increased as the customers increase that, that they're the customer’s value increases. Okay, so let me give you like I think the quintessential example, MailChimp, prices based on the size of your email list. Not unsent not on user seats and I think later plans they might not use your seat, but that's, but the bulk of their pricing is on the size of your email list, the bigger your email list, the highest price point, and there's a slider on their pricing page so if your email list is 10,015 20,000 100,000 Whatever. That's a value metric and what's, what's great about that is, every company in every customer that MailChimp has, has at least one if not multiple people focused on how do they grow their fees to MailChimp. They don't even know, that's not really what they're focused on growing their email list, but ultimately what they're really doing is by growing their email list, they're growing a fee, and then MailChimp is so aligned their, their price to customer value that customers don't care that they're paying more because they're, they believe. They believe they're getting more value. Now they're not pricing based on cents. So you can send as much you can get 10 Every single day extended email, or you can send one email every three months. If your list of 10,000 people, it's the same price, right. So MailChimp says I'm not trying to stop you from using my product, I want you to use as much as possible no price, as much as you want. But your value metric is the total size of your email list. and I'm going to price based on that. And so, if you price based on a value metric, where the customer increases value for every time. As the customer increases value their price goes up, then, then that makes a lot of sense. another classic example like Dropbox, right the more storage, the more you pay. Yeah, pretty straightforward. Okay, perfect.
Thomas Morrell 21:09 So let's go. I guess maybe through the, for example, to get a sense of your process. So, how would you mentor somebody like me so I have say a product idea? It's, again in the UX space and it's kind of focused around helping designers, product teams decide what kind of design thinking workshop to run depending on which part of them, you know, product lifecycle they're in, and a very simple tool. You know I have some money saved to do this, I do have a full-time job, but I have an understanding wife is gonna let me you know work early mornings and late nights and some weekends. How would you, what would your process be for, I guess, you know starting this and hopefully scaling it
Steven Cohn 21:51 a great question. And the first thing is that's great is that you're asking this before you know you've kind of get too far because oftentimes I do a lot of mentoring for entrepreneurs and oftentimes, they come to me after the things already built, and they're like, Well, no one's using it, what, how can you help me. You know, I'm not a magician, you know, I mean like, I have a process but it's not. No, it's not magic. So, the process I would do is exactly as I said before, create a list of who you think your persona is. Know who your buyer is reach out to them on LinkedIn. Hi, introduce. This is the problem I'm trying to solve I'm building software to solve this problem. You know I have a lot of experience in this space. I'd love to talk to you about how you guys do and if this is a problem for you, you will be pleasantly surprised and happy with it. If you're, if people think that's a problem, they will absolutely respond and thanks. Sure, I'd love to chat about it. If no one responds, then either A, you pick the wrong persona, you keep trying experimenting with different personas and again, no LinkedIn has this tool called Sales Navigator which for like $50 a month you have a whole lot of filtering on you could do company size you could do, geography, you can do, you know, job title, you can do all kinds of filtering and then you can just send them a message, you know, not long versus short. Here's my name. Here's the problem solving, You have some time to chat. If, if you actually get a problem that they have, they will respond, instead of meetings. Take those meetings, take those user interviews, understand how they do this now. What are the pains, have what are the things they hate. What are the things that they love about their process? Do they use any tools, what do they like about those tools will they hate about those tools really really really understand the problem space, and why the problem exists across a couple of, you know, across many different users don't mean a rush to jump right into a software product. Okay so for my current company impact product, my new ones. I get over 300 customer interviews 300 user interviews over a six nine-month period. And it's all the same process, but what I was looking for as I have spoken to impact production analytics tool built for design teams what I found is that design teams, basically almost never use the company's analytical tools to understand what's going on within a company. And it doesn't matter whether their company has Mixpanel or heap or amplitude or Looker or Tableau or Google Analytics or Pendo or whatever it is, design teams will never log in and use that they don't understand. Most of them can't answer. The thing that you work six weeks on designing and testing and all that stuff. Are people using it? Are they getting stuck somewhere in the flow like are they falling off like what's going on right. What percentage are you using the people who use it, are they reusing it more than once is it like, one time and then they leave it alone, they abandoned it, those basic questions, which every analytical tool out there can answer, never get used by design teams to, to answer those questions because, why, why is that. And, you know, so I reached out to a whole bunch of design teams and said this is the problem I'm trying to solve. And I've had phenomenal response rates from people now part of it is also, you know hey I love salads lately, you know, if you're making something new, I'd love to talk to you because I know you make a good product, but also part of it is, yes, this is a problem, like, understanding the impact of design. And, you know, getting basic access to analytical analytics is very is very important part of, you know, understanding outcomes for design teams. And so when I do my interviews, and I took spoke the company, you know that that have Mixpanel and amplitude and Heath and Looker and Tableau and Google Analytics at Pendo and all those products. I heard the same two problems over and over again.
Steven Cohn 26:14 requirement for developer support to instrument, every little button or thing that I want to get, you know, that's a bottleneck for design teams, they don't have access to developers in most cases they have to go through the product, they have to wait in line, etc. By the time they get the thing tagged up, then they have to wait for the data to run, you know, they might be moved on, it's too late. And the second is just the complexity of the user experience for those analytical tools, which creates a lot of friction for design teams. And so because those tools are designed for not designed for designers they're designed for data scientist quite analytical analytically trained people who are trained in analytics, and very few designs. Designers are trained on analytics and quiet, and most of their training is in qual and that's kind of their empathy-driven, you know, and understanding the user and all that type of stuff. And so, all research is awesome, believe me, I'd love to. I love qual research and you know I saw validates UserZoom which is a great product and if you want quality research that's a that's the right product for you. For quad for analytics for measuring what's going on in the product. You know that just has never been a tool designed for understanding the designer, and what there what they need. And, and so that's what we're doing so, you know, and I and I uncovered that from consistent messages hearing back from my user interviews. And then we did some prototype testing we'd go back to them and say here's an idea of what we had and we could put like a, an MVP very, you know, I know that's a word that is hotly contested I don't need to dig, scratch that edge but we put a very kind of low friction very basic product out there. And, you know have some customers test it out and try it. And the feedbacks been good. And then we worked on a new version, which we just released last week to Dotto version which will better design more features, all that stuff. And now we're just, we're continuing to kind of go out and talk to teams and get them to try it out and learn feedback, what's missing. You know what, what's confusing, what's, you know, confusing about the user experience, and going from there.
Thomas Morrell 28:34 Fantastic. And so, obviously, you had this idea. You went out you talked to 300 people, which is a lot. That's impressive. Yeah. And now it comes time to build. How do you go about I guess you know bringing in the right technology talent or the right type of people tech stack in order to kind of, you know, surround yourself and set yourself up for success.
Steven Cohn 28:58 Yeah. So it's great it's a great question. So, I can't. I have an opinion. I'm not saying My way is the only way. I'm not saying there aren't other successful approaches. I have an opinion and my opinion is big teams build big products, not necessarily better products. And so, when you have a small team, you're forced to prioritize. And my view is that specifically with b2b products, okay, but I know it probably expensive consumer products as well. My view is that, that there's one dominant powerful use case for every successful product. And then there's a whole bunch of stuff built around it, but that one early product-market fit comes down to like kind of one, just powerful awesome use case. And, and from that, you raise capital you build this whole big team you build this whole stuff. And, you know, and I look at, I would say look at Twitter, we're Twitter's MVP was like a basic. Like, it was a text message on the internet, basically, that's what was 140 characters, you know, very basic thing. Twitter has probably spent billions of 10s of billions of dollars of you maybe, maybe more, maybe hundreds of it over the course of their life. And at the end of the day, it all comes back to the tweet. Right, I mean all this stuff is just all around between I'm not including the monetization piece for the ad business or whatever, but the core value prop of Twitter is the tweet that was in the MVP. And the same thing for b2b products. And, you know, So, it's, it's that one thing, and if you understand what that is, you don't need a huge massive engineering team. Okay. And, and, you know those things that I focus on with my, With my companies is. I don't believe in story points and velocity and all that stuff. Okay. It's not about building more stuff it's, it's not a race to see who can code more, right, it's understanding the stuff that we're building our people using it. And if they're not, why are they not because it's based on user research we talked to them, they said they need this, we get we build it for them. Are they and they're not using it, why not. I don't want to just say well we checked it off the roadmap so let's build the next thing on the roadmap right. It's just trying to stay on that thing and try to understand how do we get people doing, you know with Validately. When I started, Validately, which is the quality user research tool user testing was was already pre-established but user testing at that time was only unmoderated and only on their panel. And when I talked to two research teams and design teams. The problem with that, that is, sometimes you want to talk to your own users and sometimes you want to do moderated and so and so, you know, they didn't, they didn't have, they back then they were using to find out, you know, to talk to your own users, it was, it was paying you had to try to get a, you know, an email list from marketing, which is always hard or whatever it is, or you would put a, an ad up on Craigslist, right, which was a pain, and then you would use Skype was like the main tool at the time, you know, this was before Google Hangouts or whatever was popular and zoom, and the problem that they had were, they couldn't. It was after they did the interviews when they had to download the videos and create little highlight clips and annotated notes and all that stuff.
Steven Cohn 33:07 That's where all the pain was so it wasn't in the generic just screen sharing the pain that these researchers had when I started Validately was after was done, how do I turn all that that I just did my six user interviews, into something that I can explain to my team. Here are the key points, right, you're not going to watch six hours or three hours of interviews. I already did that. I need to synthesize this for you. And so they kind of the big powerful thing that basically from that, from these two those two features and Validately, I was sure all these other tools were going to copy, but they never did, but two features we had is we made it super simple we had moderate technology, which is a good technology but not no different than any other video conferencing tool, but the two features that we had that researcher, researchers loved. Easy Video clips. So literally just click the scrubber, create the clip and annotated notes, married that with an easy way to do it if you have your own list for our own panel. A panel, which was, you know, a commodity, panel of companies or commodity. And so that, that use case was, you know, we've done a successful business off of just that use case. And so, if you so coming back to your question on engineering teams, I don't think you need a big engineering team, I think, if you have one back end great back end person and one great front end, Dev. And a great designer and a product focus go to market focus founder, you can, you could build an awesome company from there, I think that's really a core founding team, a great designer, a great back end engineer, a great front end engineer. And, and a product focused, you know, go to market focus, either, either founder, or co founder type of person. And yeah and that's it and so you just you just, it forces prioritization.
Thomas Morrell 35:25 Gotcha, gotcha. That's an extremely lean team, I like the sounds of that you know I've been working at, you know, very large organizations so that sounds exciting. Yeah, and you also, yeah some pretty great advisors on your team, it sounds like for impact product. Jeff Gotthelf, you know, writer have a number of the kind of industry standard books. How did those relationships come about.
Steven Cohn 35:49 Yeah so Jeff got up and Josh Seiden and Becky Buck also our advisors. So, yes, was an advisor to Validately lead as well. And I actually met him at. Oh man, what was that conference in, in Austin, tech conference in South by Southwest. Yeah, sounds like yeah, so actually I went to I went to a when I was starting Validately. He was given a presentation at South by, I went up to him afterwards and I introduced myself, and I said, I'm working on this problem, almost like I do in LinkedIn, I'm working on this problem I'd love to talk to you about it. And he said that sounds interesting, and here's my. Here's my email, shoot me an email and I, From there I talked to him I showed him a demo I said, I want you on my advisory board I want to give you equity in my company, he said sounds good and we had a great working relationship. His partner through many of his books is Josh Seiden, who's written a number of books including Lean UX with co authored Lean UX. He also wrote, outputs, outcomes not outputs or outcomes over outputs, which is a great book, and I highly recommend that it's a short book, I actually got it on audio. I got the book on tape, and I put it on 1.5 speed and I walk around my neighborhood and I finished it in like, you know, two walks, it's but it's, it's a powerful book it's a great book. And, and so I their natural fit. Becky is awesome. She was one of my first customers at validly from a big company, she was at Salesforce at the time, and she's just an early, just like she loves products, she loves design to love founders, and just a great person to talk to and so she's been working with us on the design of the product and stuff like that. And so I think that like the thing I've learned about advisors are the reality is most of the time, advisors, add very little to any value for a startup. This really comes down to how you structure the advisory relationship. If you just want a headshot to put on your website. It's really not worth much to the startup, you know, you're not gonna get much value out of just the headshot of an advisor on your, on your website. And that's a little bit of credibility but at the end of the day, it's not why people make purchase decisions. So you have to ask your advisors to provide value, right and like what, what can they do to provide value well either. They have domain expertise they, and they have to, but you have to get them to commit to it. So when the advisor agreements, you have to say hey, you got to meet with me, X number of times a month, a quarter or a year, whatever it is right that's the agreement that you're going to have that conversation upfront with your advisors, and put it in writing so they have to sign in writing that this is what they're agreeing to from a commitment perspective, social, obviously a lot of them have a lot of followers in your area right, take their commitment to share, share your social posts, and to their community. Right. And so it's better to have fewer advisors, but ones that are deeply committed to your success, and that you have a relate a structure relate advisory relationship to that they're going to actually provide value, as opposed to just be a headshot on a team page, you know, there's, there's not much value in that. Gotcha.
Thomas Morrell 39:41 I appreciate that, that's, that's fantastic. So when you set out to build a product like this you're three for three for creating a product and then being acquired which is amazing. Do you go into it with the intention of building it to sell or do, is that just a, you know, a happy byproduct of building a successful tool.
Steven Cohn Great question. So, I you know I think I, one of my kind of sayings is, founders should be thinking about entrances not exits. So, you know founders should only be thinking about how to enter a market. What I found for sure. Definitively without any doubt. And by the way early in my career I was in m&a. For first three years of my career I was in investment banking and an m&a and an m&a role at double click. And the thing I found for sure is, if you build a great product that customers love, and you have a efficient go to market strategy that is able to acquire customers and grow and your business can grow exits will happen very successful. You'll get plenty of opportunities to whoodle happen is your competitors will know, they'll be like, and these guys again. You know, first, first of all, ignore you, then they'll just brush you off as like an ankle biter or whatever it is. And then they'll start taking you seriously. Once you want to flip one of their bigger clients, or you start getting like you know another big deal or two, and the salesperson, goes back to their manager and say we lost these guys again, and they're killing him. And then when it's happening is, you know, if he's still a big customer too and they miss their quarter or whatever, then they're poking around and you got to make a decision early on, like, actually one of my professors at at Harvard Business School has, has a question. He said, Do you want to be rich or do you want to be king. And, you know, meaning do you want to do you want to be you know, Ilan Musk wants to be king like he wants to literally be the head of like like he wants to lead an electric vehicle revolution right he wants to kill fossil fuels, and, and there is, He is completely mission driven. And, and, you know, is that your goal or do you want to do you want to, you know, be successful financial, from my perspective. It's also, look, when I ran validate Li, I started validating I didn't take a salary for two years. And when I started thinking a salary, it was way under my expenses I was burning cash for seven straight years. Okay. I had almost all of my net worth tied up into validated and I also wrote, big checks into validated to keep it alive in their in their early years when it was running on fumes and we were struggling to get product market fit. So I believe that if I had not sold validate lean 2019, it'd be worth significantly more now. You know I didn't know anything about the pandemic obviously because it's 2019 but we actually understand that the business, validating was perfectly positioned to do extremely well during the pandemic because it's remote to make some. Yeah, it was a low cost remote tool and that was our kind of go to market. And so we would have probably continued to grow very fast, and would have been worth more. That said, I have no regrets for selling it, and, and at the time, it was the right exit for the team and for myself personally, because I had invested heavily in it. Now that I'm, you know, that you know I had, you know, was able to have that exit for my new company, you know, probably let it ride, you know, longer and see where we go, you know, but, you know exits are, you know, it's, it's a personal decision. And, you know, the thing is is like, everyone likes to think about like, oh, the founder made all this money in this segment, well, yeah. How about like seven years ago, eight years ago when they were like, you know, living on ramen noodles and burning, taking out credit cards and not sleeping because they had no money, you know, where was everyone else back then, you know, and so, you know you got to be, you know, but if you if you build a great product. And again, it all comes back to the product from my point of view. If you build a great product that customers love that solves a real need. You'll all their stuff will take care of itself.
Thomas Morrell And just one more question with that is, how did you keep going through, you know those seven years where you were, as you said eating ramen and your sleepless nights.
Steven Cohn So, I have a philosophy that, that there are two types of successful founders, only two. There's the Steve Jobs type the the Elan Musk type, the true visionaries like this true vision, and rare human beings, rare, rare human beings. And they're quirky they're odd they probably dropped out of school because they, you know, they, they're too smart for everyone, and they end up just completely revolutionising the world. I'm not that person, that's just not me, I'm not, I'm not that I'm not that type of founder. The second type of successful founder is Rocky Balboa. Okay, the fighter who is talented but not crazy talented, but his greatest talent as the character his greatest talent is that he just he just won't go down. He just won't give up. Like, it's always one more round. One more round. And no matter what happens, he's going to take a beating from the Russian, you know, the big Russian or Mr T or whoever the character is is going to beat him up, but he's always there in the last round when the bell rings and say one more round, and, and that is what it takes to be a successful entrepreneur, because you are going to get so much rejection, and so many failures, and so many people saying this is a dumb idea it's never going to work, you're going to fail and you're not going to be successful. And, you know, Fundamentally, you have to determine whether, you know, your customers are saying that, or others are saying that, and you just have to find a way to survive in advance and just keep every, every day I used to say, you know, did I make progress today. That's it, I just need to make progress today, that's all I'm trying to do is make progress today and then tomorrow, I'm trying to make progress tomorrow, right, like every single day just move the ball forward. And I would literally say that to myself out loud when I, you know, when I, when I get home at night. Now I was exhausted I say did I make progress today. So yeah, actually I closed this one deal and I moved this other opportunity, forward. Okay, great, successful day. Now go do it tomorrow. And, you know it's hard. It's really hard. I think the hardest part about being entrepreneur is the financial stress it puts on your family. And, most, most, most people don't talk about that, but it was, I mean when I first started my first company. I had a newborn baby, and my wife had stopped working, which was to the high risk pregnancy, and so she had to stop working, she was on bed rest, and, and then I had a newborn baby I was taking basically no salary for several years. And, you know, burning all my savings. And it was really hard. It was very very stressful, and I was more stressed about my own personal fame, you know, money than I was about success for the business. But, you know, I believed in it, and I and I. I just have the kind of Rocky Balboa mentality where I'm just I'm just literally, you're not going to, I'm just going to keep getting up off the, off the mat and I'm gonna keep coming forward. And it doesn't matter how much you punch me in the face like it's just gonna I'm just gonna keep moving forward, you know, that's, that's my. And
Thomas Morrellthat's, that's fantastic, and I don't want to take up too much of your time like, I really can't thank you enough for all these insights and for your time. Could you tell us you know what's next for you and impact product,
Steven Cohn yeah and yeah. Yeah, so my next thing is impact product, it's, it's a, you know, the kind of core different to product analytics user analytics tool, the core differentiation is that it's actually something that's so easy to use that literally everyone on the team could use it. And what I found in all my user research is that analytical tools are super super super powerful, but only a few people within an organization actually use those products. And so there's a lot of people who need to know what's going on in the product with our customers with our users who best case scenario can ask someone else to run a report. In most cases, in some cases they don't have anything, and in some cases they can ask someone else to run a report. And the reason why these other products. Don't get used or implemented, it's because they're basically designed and created with the persona of the analytical guru in mind that that's, that's who they're building for they're building for this analytical guru who needs everything that needs switches and filters and all these type of ways to slice and dice and find a needle in the haystack. And that's awesome. I'm not dismissing that at all. That's a super powerful super valuable use case, but there's a lot of people who look at those user experiences, and say, Man, I have no idea how to use this product, and all I want to do is answer this basic question. How do I answer this basic question. Are people using this thing. How frequently are they using it. Are they using it more than once after they use it, right, are they getting stuck somewhere in the process at all I want to know, and I don't want all this stuff. And so the two big bottlenecks are developer support for instrumentation of all the buttons and links all that stuff, and user experience of these dashboard query building heavy analytical tools. And so what we've done with impact product is we said let's kill both of those. So the way it works is, it's a lot of JavaScript that you add your site header, and you track we track every click event that happens, there's no configuration needed there's no developer support needed. If you have Google Tag Manager, you can even put it live without a developer, if you don't, it's a five minute deploy for a developer literally JavaScript into the site. There's no PII capture with the, with the JavaScript. So from a privacy perspective and there's no impact on page load. But the beauty of that is that everything is tracked at all times. There's no developer support needed. And the second big thing we did is we said, no, no analytical tool dashboard. So the way our product works is it's an extra Chrome extension to open up your own product, you will you find the thing that you want to get information on, you open up our Chrome extension, you click on the, you click on the button or link in your own product, and we give you metrics there, we're using the heart framework from Google so happiness. Engagement adoption retention and task success. And then we have metrics metrics underneath that so we can tell you for any button or user flow, if you want to create a user flow you scoop, click, click, click this these are the three steps in the user flow. Or maybe there's a couple of steps in between whatever will give you tasks, t test success metrics, number of unique going through it, conversion rates, time on task time in between each step. Okay, and what's great about that is, is that if you find a usability problem, then you can do user research on it you can run your, your quality research, so it really goes hand in hand and empowers your call, research, testing that you can do, but it's so simple, everyone can use it because all you do is you just open up your product, you click on a button, and you get the metrics right there, adoption rates reuse rates, and, and cast access. And so, the next piece is we are going to add what we call an identify feature where then you if you want, that's your choice as a customer, you can then pass customer information to us. And then what we could say is, not only did this is the this is the this is the fall off from the user flow. And by the way, between step three and step four, you had 30% fall off, and it was, it took them average two minutes and 55 seconds between step two and step three or 334. But you can download a list of the users who did that. Okay so now you can say, Alright, great. Let me flip this over to her, our UX research team, and they can reach out to them and do their usability testing with a validated or resume you should go. And,
Steven Cohn and, and learn, and then fix it. And what we're trying to do is speed up that time, because half the teams I spoke to don't have any analytics. The other half have to basically send an email or a Slack message to a product manager, who will then configure that solution, then they have to run in, you know, wait for the data to populate. And it's, it's what I hear is anywhere from two to six weeks before they finally get a report on that, that, hmm, right Yes. And that is wasted time. So what we can literally do is we can kill that in that whole back and forth, the designer can just open up the product, open up our extension click click click see where the follow up is download a list of users who who failed to complete the user flow, reach out to them do a usability test to fix the problem, and go from there. Yeah, and that's, that's the vision. That's what we're trying to do.
Thomas MorrellThat's great. And yeah, I do before this call I installed it on my Squarespace site it took all of seconds to put on and working. Fantastic. Yeah, and I couldn't relate to all those problems you mentioned working at big companies trying to get the information that you need and also mentor students, and we do a course on analytics, and most of them get very scared when that part of the course comes up and don't want really anything to do with it because it is just kind of makes them go a little fuzzy, when they're looking at all the different things you could do with Google Analytics. So, it's fantastic, um, where can people go to get in touch with you.
Steven Cohn Oh, go ahead. Yeah, so, yeah, I'm just gonna add something to that last thing you said was, was, you know, when I did all my user interviews. If I'm being very candid. Okay, I really don't like what was taken the wrong way because I people believe every human being has strengths and weaknesses are areas where they're strong in and areas where they need developmental and that's not good or bad, it's just as human beings, that's how humans work. Not everyone's great at everything, you know, some people are great at this and some people are great at that. One of the things I've found over and over and over. Once I peel back the layers of the onion with with, you know, and I kind of usually happen like at the 25th minute of my user, like right towards the end, people would tell me that they feel intimidated by these tools, they feel frustrated they feel like, almost embarrassed, like, like, am I supposed to know what what how to interpret this thing because I don't know how to interpret this but I don't want to pretend like I do in front of my teammates because I don't want to look like an idiot, but the reality is I have no idea. And so, so that but they because they're designed for someone else. They're designed, they have jargon, they have terms that people understand what they are, they're structured in a way that if you're not trained in analytics you look at these things and you're like, I don't even know what this is, I don't know what this means. And, and so we're designing for that persona. And so like one of the things that we did in our design and our product is to create a user flow, not only do we have a chart for you, but we have a natural language sentence that tells you what is going on in that chart in like humans speak. And so you don't actually have to interpret it because we've interpreted it for you and just telling you and you can literally copy and paste that into Slack and say here's what's going on as well. Right. And so understanding the psychology of how, how your target customers feel when they try the other products that are in market is very important, and that that creates an opportunity for you to get in touch with me Steven does impact product, calm, and for you just go to impact product, calm, and there's a Contact button, do that. And, or you can reach out to me on LinkedIn, Stephen Cohen Theo Chen and love to chat.
Thomas MorrellCool. Honestly, again, I can't thank you enough for taking all this time, I really appreciate it and I hope you had fun doing this so
Steven Cohn awesome I did, I love, I mean I love talking products and startups and I hopefully my passion for this topic, you know, came out and because I have a tremendous amount of passion for, for this topic and building products and design. I've been building technology products for the UX industry for almost a decade now. I said that some of the day I was like holy cow. Wow. And, and I love it, it's a great industry. It's a great industry and the people in the design industry are just terrific. And I found that I believe that the best customers because they're so willing to give feedback. You know it's amazing, you know. Now, obviously they have some opinions on design like stuff that is, you say thank you very much, but that's not really what I'm asking. Yes, exactly. I appreciate that. Yeah, exactly. I appreciate your opinion on the font, but really what I'm trying to get at is the actual thing. But, but in general I found them to be, the designers by researchers to be just a great customer segments to build products for, and very helpful and positive and supportive and crave for user research and usability testing.
Thomas MorrellFantastic. Yeah, no, this was wonderful in your passion and your focus, absolutely comes through loud and clear. So, really appreciate it.
And that's the show everybody. Thank you so much for tuning in today, if you haven't already please subscribe to the show on Apple, Spotify, Google podcasts or anywhere else you listen to podcasts. I'll be releasing a show about every other week or so, if you'd like to be a friend of the show, leaving a review and a comment on Apple would be very much appreciated, share a link to this show with your friends and anyone else who's interested in UX design, feel free to recommend topics you'd like to hear discussed here. And if you have any questions about design careers or anything else for that matter, you can DM me on my Instagram @userflows.live
Now let's go create.
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