Products that SLIP

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Your product needs to feed the business model, and the user has to have an experience they love. How many of you downloaded an app on your phone? And how many deleted one within five minutes? That happens all the time. It was either not a good experience or not good value. That leads to a set of startup secrets you can design in from the get-go, even from a paper prototype, before you have a product.

Startup Secret: build products that SLIP (slippery products). A long time ago I called this “slippery.” When I told my daughter, she said, “Dad, what have slippers got to do with products?” She kind of missed the point. The essence is friction-free. SLIP means:

• Simple to use and install.
• Low to no initial cost.
• Instant (and ongoing) value.
• Plays well in the ecosystem with everything else around it.

Think about that app you deleted. It was probably simple to install (you clicked to download), but maybe not simple to use, which is why you threw it away. Was it delivering instant value? Clearly not, or you would have kept it. Time to value is incredibly important, whether it is a service, a product, or data. And plays well in the ecosystem: if you have to change your phone to use the app, you are not going to use it.

Startup Secret: the best value props are highly disruptive but non-disruptive to use. In the enterprise this is critical: if it disrupts everything, even if it is free and easy and valuable, having to replace everything first will kill it. Twenty years ago you built an enterprise product on stacks of hardware under your desk; today you build it in a container and deploy it to AWS or your favorite cloud, which is incredibly non-disruptive and gets you huge benefits. A slippery product also delivers on the customer’s payback and ROI, which you should make obvious right up front, and ultimately on the “why not,” which is what you want customers thinking: not “why might I try it,” but “why can I not live without this.” For those who were at the value proposition session, that is the gain/pain equation: give them so much gain and so little pain (because it is so friction-free to adopt) that they buy it.

SLIP has since become popular, 15 years later, under the term product-led growth (PLG). If you want to investigate how to make products that are slippery and friction-free, that is the modern name for it.

Slippery products are also fundamentally a business model decision, not just an R&D one. People say R&D has nothing to do with the business model, but it has a ton to do with it. If from the get-go you decide to create a slippery product, you take a ton of the friction (the cost) out of marketing, distribution, sales, service, and support.

Twilio and the healthcare API (know your audience). If you are selling an API, are you selling it to a developer or an end user? Twilio was an incredibly successful API-first company; many say they led the API economy (not really true, Amazon did it years before). They sold to developers, because developers do not want a finished product (then they have no job), and they love APIs because it gives them a multiplier on their experience and lets them build things quicker. That is why Twilio took off. By contrast, a company we backed built a brilliant API in healthcare, and it failed terribly, because healthcare developers do not hold the budget or the clout. Even though they loved the product, they could not get anyone to pay attention or give them budget. The healthcare provider said, “I just want the solution, give me the workflow, give me the process, I do not want to develop for six months and customize this.” The takeaway: it is about the audience (back to the customer first) and about giving them a solution to a significant problem they can immediately use. Back to SLIP: simple for them, low to no initial cost, instant and ongoing value, plays well in their ecosystem.

Drupal is a slippery product. Drupal is simple: you can build an entire, rich, powerful website from within the browser without programming. It is free (so it checks the L). It installs incredibly easily, and there is a software-as-a-service version (Drupal Gardens) where you sign up and have a site running within minutes, versus proprietary vendors where you talk to a salesperson, schedule a demo, then buy, which takes weeks or months. It proves value quickly (you can start using it immediately, and “distributions” are productized versions, for example Open Publish gives you a newspaper website out of the box). And it plays well with others: because of its open architecture it integrates with everything from Amazon Commerce to PayPal to Salesforce to Pinterest, and when something new like Pinterest comes out, the community builds an integration module within weeks, whereas a proprietary competitor might take many months or years (first Pinterest has to become a thing, then be recognized by a product manager, then put on a roadmap that may already be sold to customers).

Active Endpoints (Mark Taber) selling complex middleware slippery. I inherited this investment (never easy), but I recruited Mark Taber as CEO. It was a middleware product, in fact a tiny feature called a “Beetle engine,” not even a whole product. The first thing Mark said was, “I do not want to talk about the product, I want to talk about the business model.” He built the whole company around making it simple and how to bring it to market. Business process management had been around forever but was way too hard, so Active Endpoints let the business user do their own automation. For example, a salesperson using Salesforce.com (really just a database) does not want to write reports and frequently forgets follow-ups. With Active Endpoints, using speech-to-text on an iPhone with Siri, you say “show me my meetings today,” speak what happened, and hit a button to send a thank-you email or set a follow-up automatically. The real innovation is letting the business user do it themselves. The go-to-market was slippery: go to the website, enable yourself, try it, use a free version. Eric Egerson (head of sales) told the Plymouth Rock Energy story: an old-line coal and oil supplier that became an energy broker, using Salesforce.com for new customer signups (a very complex process specifying supplier, distribution channel, and green-energy premium). We met them at a Salesforce.com event on a Wednesday, gave a demo the following Monday via web meeting, they got on our cloud-hosted product, started building their process wizard the next day, had it working by end of week, and placed the order the following Monday. Installs easily (signed up on the web), proves value in days (a wizard walking users through the complex process), plays well with others (the Salesforce.com integration is both a lever, reducing marketing cost because we know our market, and a multiplier, letting us sell per user per month). They were worried they would only have 15 users to start; fine, buy 15 licenses, add 10 more next year. Selling middleware is normally a horribly complex sale (competitors like IBM go in with three-person, six-legged sales calls and charge orders of magnitude more). Active Endpoints took market share consistently and doubled year on year through the slippery product concept, doing tens or hundreds of thousands of dollars of value over the phone with not a single outside salesperson.