First Instinct Risk
Most founders are worried about the wrong type of risk.
When most of our entrepreneurs get close to whatever their first “product” will be — in Tacklebox, this is usually a Concierge MVP — they worry about product risk. Will this thing they’ve pulled together with duct tape and bubble gum actually work?
This is obviously important, but it’s not the type of risk that worries me. We can almost always navigate product risk in real-time, especially when we’re running Concierge MVPs.
The actually dangerous type of risk is what I call “First Instinct Risk.” FIR is the immediate risk the customer feels when we’re selling a Concierge MVP to them, and it derails the majority of these tests before they start.
This will be clearer after an example.
I got this email the other day from someone trying to improve our marketing email conversion.
Aleksandar is offering to create a marketing campaign and run it head to head against one of my marketing campaigns to show that his will perform better. He describes this opportunity as “no-risk” as I’m not paying any money for the campaign and have no obligation to work with him after.
But, hopefully obviously, he’s completely misunderstood what’s “risky” to me in this scenario.
Spending a few dollars on an outsourced marketing campaign isn’t “risky” — I’m happy to spend money for better conversion. But letting a complete stranger interact on my behalf with the customer base I’ve painstakingly built over the past 10 years? That feels preposterously risky. There’s absolutely no scenario where I, or anyone I’ve ever met who’s run a business, would say yes to this.
This may sound extreme, but this type of thing happens all the time: Founders unwittingly ask their first customers to shoulder all the risk.
This is why design partners — first customers that are using the product but also helping you develop it — are so important.
When you’re building your landing page or sales emails for the Concierge MVP, make sure you get on a zoom call with your design partner or a potential first customer and have them read the site / email in real-time. Ask them about the risk they feel immediately. Then, figure out a way to shoulder that risk.
If Aleksandr had done this, he’d never have sent that email and spent all the time making a personalized video. I would’ve told him the risk was using my audience, and he’d need to figure out how to show his service without using my audience. Or, have a different value prop that I’d pay for up front and work with him on.
Understand your customer’s First Instinct Risk, then shoulder it.