Notorious PLG 7.21.22: Advice from the Most Iconic Web3 Founders

Jul 21, 2022

Current subscribers: 2,121

Advice from the Most Iconic Web3 Founders

This Tuesday, I had the privilege of interviewing two of the most iconic founders in the world: Sam Bankman-Fried of FTX and Anatoly Yakovenko of Solana. We spoke about their experience building their startups and lessons learned. If you want to do a deeper dive into our summit, here is some good coverage of the event. For today’s edition of NPLG, I wanted to share a few of the lessons that stood out to me:

Stay Lean: FTX is valued at $30B+, but has ~300 employees. Sam talked extensively about how they don’t add someone to a team unless certain criteria are met: there is strong leadership on that team, there is training infrastructure in place for a new team member, there is a clear role for a new candidate. Most startups think the flywheel is raise a lot of money, hire a lot of people and repeat. As startups scale, this can lead to a lot of smart people running around not knowing what to do or how to do it. FTX has been very intentional about hiring and it’s paying off. Anatoly said something similar about Solana - he only makes a hire if it will have a clear impact on driving revenue.

Extreme Ownership: In the early days of FTX, some of the users were targeted via phishing attacks. Sam opened up that these attacks weren’t technically FTX’s fault, however as CEO he had to step up and take extreme ownership and claim fault for these attacks since they happened as part of the FTX user experience. When talking about unplanned downtime, Sam would repeatedly say: “this was on me. I take the blame.” This mentality of owning all mistakes and issues for the end-to-end customer experience is really rare, yet is a critical quality of leadership to building a generational company.

Launch an Aspirational Product: FTX entered a crowded market (Binance, Coinbase, etc), but clearly defined who they were building for: the prosumer power trader. This meant focusing on advanced trading features and building the most performant exchange. Although FTX focused on a more sophisticated user, this brought the everyday trader into the FTX product. I always think about how Patagonia markets to technical climbers scaling mountains, but the typical Patagonia buyer is a suburban mom and dad walking through a Whole Foods parking lot. Sam credits FTX’s success directly to the quality of the product and it helps if you build an aspirational product that appeals to power users because this will attract the broad base of every day users. FTX grew via word of mouth from having the best product - PLG for the win.

Build for the First 1,000 Users: Anatoly stressed the importance of focus while searching for product market fit. You need to win over the hearts and minds of 1,000 users who love your product. This is a critical step before thinking about scaling. Solana did a great job of building accessible products for developers and built a core group of 1,000+ early power users. They stayed relentlessly focused on these initial customer personas and ignored the noise from non-target users.

Push Product Boundaries: Solana credits its success to continually pushing the boundaries of its product across scale and performance. This philosophy is consistent with PLG. The best product will win and the best startups continually push the boundaries of what is possible and surprise and delight their customers with new features and services. Solana, for example, is making a big push on mobile and is launching a phone, the first web3 company to do so. This ethos of pushing product boundaries increases the brand halo and brings more technical and power users into the ecosystem which is a harbinger for more and more user growth.

Build in Public: Both CEOs are active on twitter. They engage with their customers and speak up when there are issues with the product. I believe this is a critical initiative to build a generational business. Part of the product experience today is interacting with the team building the product and Twitter is a great platform to do so. Sam says spending time on Twitter is not easy and is time consuming but is well worth it. Do it, it’s an important investment!

I would love to hear your feedback. Please email me at zach@wing.vc

PLG Tweet(s) of the Week:

Max Friedman @max_friedman8

Product-led growth has helped @givebutter power more than $300M in donations for thousands of nonprofits. Until recently, I didn't even know what PLG was. Here's what I've learned, and how we've grown organically with almost $0 spent on paid acquisition:

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