Startups For the Rest of Us
Episode 691 | Freemium, High-touch vs. Low-touch, Selling as an Introvert, and More Listener Questions
Dec 12, 2023
Explore the nuances of the freemium model and charging by the 'honor system' for your product. Discover strategies for competing against established giants, even in saturated markets. Learn about the nuances of high-touch versus low-touch sales techniques and how introverted founders can leverage their unique traits to succeed in sales. Additionally, find valuable book recommendations for those looking to improve their selling prowess, making entrepreneurship accessible for everyone.
23:04
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Quick takeaways
- Competing against entrenched incumbents is increasingly difficult in markets influenced by network effects, requiring careful strategic consideration by entrepreneurs.
- Introverted founders can successfully embrace their nature in sales by fostering authentic connections and focusing on genuine customer needs rather than traditional tactics.
Deep dives
Understanding Network Effects in Competition
If a business operates in an environment characterized by network effects, it can be extremely challenging for newcomers to gain traction against established players. Network effects occur when the value of a service increases as more users join, making platforms like eBay and Craigslist nearly impossible to unseat despite lack of innovation. For entrepreneurs, this means entering markets dominated by legacy organizations with strong network effects can be a risky endeavor, especially for bootstrappers. Acknowledging these conditions upfront can help founders gauge whether their business idea can effectively compete or if they should pivot to a different strategy or market.
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