WhoBuilt

How to Get Your First Customers

Dec 29, 2022· 23 min· 670K views·Watch on YouTube

Speaker

Gustav Alströmer, a group partner at Y Combinator, explains how founders can turn user conversations into their first customers in a Startup School session.

Founders have to create early momentum

Alströmer uses Paul Graham’s “Do Things That Don’t Scale” essay and Airbnb’s early days to explain why a good product rarely grows on its own. Founders need to recruit customers directly, improve the product with their feedback, and keep moving through setbacks such as the “trough of sorrow.”

Learn sales by doing it yourself

Alströmer argues that founders should learn sales before hiring a sales team because customer conversations reveal what to build and how to explain its value. He points to Brex, whose founders signed up their first 10 customers from the YC batch and personally onboarded them. He recommends short, plain-text sales emails that name the customer’s problem, establish credibility, and include a clear next step.

Build a simple funnel and pursue likely customers

The basic funnel is to make a prospect list, reach out, run a demo, discuss pricing, close, and onboard each customer. Alströmer recommends starting with the easiest prospects, including people in a founder’s network and startups, which often have shorter decision-making paths. Since many prospects are not early adopters, founders should contact enough people to find those who are.

Charge and measure each step

Alströmer says payment is evidence that a product provides value, and advises B2B founders to consider a money-back guarantee or a one-month option instead of a free trial. He illustrates funnel tracking with 500 outreach messages leading to 250 opens, about 12 responses, six demos, and two customers. Sending only 100 messages may produce no customers, but that is too little data to conclude sales is not working.

Start with hands-on growth

Alströmer recommends Lenny Rachitsky’s research on how startups began selling, and notes that companies such as Amplitude, Stripe, and Front used outbound email early on. Scalable channels like SEO and search ads may take time or cost money, while early customer conversations help founders learn directly. Even Airbnb began with work that did not scale before using broader growth channels.

Takeaways

  • Founders should learn to sell before hiring a sales team.
  • Start with prospects who are easy to reach and likely to buy.
  • Track outreach, responses, demos, closes, and onboarding in a simple CRM.
  • Use paid commitments to test whether customers value the product.
  • Do enough outreach to gather useful evidence before judging a sales channel.

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What was claimed 17

  • role at
    Gustav Alströmer is group partner at Y Combinator
    “I'm a group partner here at Y Combinator.”
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    Unverified1 source· Talk
  • feature
    Y Combinator: Startup accelerator batch provides founders access to potential startup customers
    “In a YC batch, you have the benefit of being around other startups—potential customers.”
    YouTube
    Unverified1 source· Talk
  • metric
    Brex: Recruited first 10 customers directly from the YC batch
    “they recruited their first 10 customers directly from the YC batch”
    YouTube
    Unverified1 source· Talk
  • metric
    Brex: Zero annual fees
    “there are zero annual fees”
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    Unverified1 source· Talk
  • feature
    Brex: Does not require a personal guarantee
    “We don't require a personal guarantee.”
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    Unverified1 source· Talk
  • feature
    Brex: Corporate credit card focused on technology companies
    “Brex is a corporate credit card focused on technology companies.”
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    Unverified1 source· Talk
  • feature
    Google Sheets: Can be used to make a list of prospective customers
    “You can use Google Sheets or something like that to make this list.”
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    Unverified1 source· Talk
  • uses
    “early companies like Amplitude, Stripe, and Front were doing outbound sales emails”
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    Unverified1 source· Talk
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