Go-to-market in web3 | Maggie Hsu & Pyrs Carvolth

Transcript

[Music] thank you my name is Maggie Shu and I run go to market for crypto fund I'm joined today by my colleague Pierce carvoth our go to market partner I'll be talking about what go to market is go to market in web 3 some go to market tactics and then Pierce will Deep dive into two critical elements of go to market the role of Partnerships and negotiating so what is go to market exactly well go to market encompasses many things but at its core it's a plan for how to bring a product or service to Market and then it's the execution of that plan

and a go to market plan has many elements First You're Building the product or service offering you're then defining your target market that you're selling to you're setting your pricing determining the appropriate messaging and then finally you're deciding where and how to reach your customers once the plan is set how does a company then acquire new customers well you would bring potential customers through this acquisition funnel using a mix of strategies and it's worth noting that this is an ongoing process and if all goes well you're driving usage and growth of the product or service so what does go to market in web 3 and how does that potentially differ from go

to market in web 2. well there are many sorts of web 3 companies that actually have go to market plans that are pretty similar to what we just saw and examples here could be wallets and marketplaces but there are a number of other types of web3 companies that have slightly different go to market plans and examples here could be nft communities or certain types of dows and in these examples rather than starting by building a product or service offering they're actually starting by defining the need that they're solving and rather than defining a target market to sell to you're starting by defining your target stakeholders so when these go to market plans you're starting with purpose rather than product the product can come later

and you're starting by thinking through your stakeholders rather than who you're selling to and the stakeholders could include your community members your users the company itself or your investors what determines whether go to market plan is more like the top or the bottom well they're really two factors the first is the level of decentralization of the company and this is across three Frameworks technical economic and legal and the second is whether or not they have a token and whereas in the first example this is a lot more about top-down planning in the second example it's much more about bottom-up gardening because the approach here is that you're setting strategy and you're creating the infrastructure in a

way that doesn't necessarily dictate the outcome because you oftentimes don't even know what that outcome is at the beginning of the process now that you have your go to market plan what are some go to market tactics that you could use this broadly divides into whether you're thinking about things like ecosystems this could be layer 1 and layer 2 blockchains or protocols like uniswap and compound or the second group would be products and services and these could be wallets marketplaces or analytics and monitoring Services as some examples so let's deep dive into ecosystems let's say we're launching an L1 or an L2 and you're bringing that to Market pardon the the Consulting slide I'm a former recovering consultant but we can

kind of walk through the supply and demand so in this case you're looking to grow both the supply and demand at the same time and how do you do that well you're targeting both individuals and so this is a one-to-one motion here and you're also targeting channels and this is really one-to-many and so on the individual side that's really on the supply side around developers and on the demand side it's around your community and your users your channels these are through Integrations and Partnerships and then the result here would be number of active Developers active addresses growing number of transactions growth in tvl and I'll just Deep dive into each of these categories

so on the first front developer interest and Activity one critical piece here is developer engagement Solana runs hacker houses all around the world and they've engaged tens of thousands of Developers for these in-person experiences oftentimes hackathons are done as one-offs and they've been able to build this scalable program around them to grow and strengthen this developer community optimism uses something called retroactive public goods funding where in this case they allocate part of their token Supply to retroactively reward projects that are bringing value to the optimism ecosystem and it's not enough just to have your protocol design or your developer tooling but in most cases you really

need to develop the first set of front ends as well so in this case forecaster is a social protocol but they've also developed this front-end warpcast this applies to things like payment protocols or l1s where it isn't enough just to put out the developer documentation but you really also need to show what's possible on the second front Community engagement excitement social connection is so key here and this comes across both in digital forums so this is in social media as well as in physical forums and this is why events meetups and conferences are so important and there's really this outsized role of community and events even over marketing at least at first

because it's really about building with a community rather than marketing to a community on the third front Integrations and Partnerships so it's important here to be supported by the likes of custody providers wallets and stable coins on the partnership side let's say you're trying to reach many developers at once one good example could be to partner with a cloud provider so in this example app does partnered with Google Cloud or partnering with an IP or brand so an early example of this was Dapper and flow partnering with the MBA around topshot or more recently polygon partnering with Starbucks around their Odyssey nft program and you can also have Community to Community Partnerships so my colleague

Scott commoners has written about a technique called wave minting where in this case 1337 skulls allowed other nft community holders to Mint in waves starting with the most closely aligned communities in this case now it's in blipmap another example of a community to Community Partnership is when DJ Steve Aoki and Justin Blau created a group called punks and they did an nft giveaway where you had to be a holder of this nft in order to be eligible for the giveaway in this case Blau Aoki verse or crypto Punk and it may seem like you're trying to do everything all at once and and try instead of tracking one growth metric you're really tracking several different metrics

but these are truly complex adaptive systems and examples of these sorts of systems include ant and bee colonies cities your immune system financial markets in these systems you have heterogeneous agents they're coming together to interact and then there's some sort of emergence that happens and it's impossible to deterministically plan the outcome of your efforts the best you can do here is really to equip the various agents within your ecosystem to move forward towards a shared vision I'll now just touch on products and services so again examples here could be a wallet or a game and here the user acquisition model is very similar to in web 2 where you're attracting engaging and converting

potential users you have a number of traditional growth levers such as advertising and sponsorship but you also have things like token incentives and we're just starting to see how these all tie together one example is coinbase coinbase has done things like traditional tv ads they've done sponsorships but they also did this open Edition mint when they launched base they're all too and another example is nikes.swoosh where they've used things like out of home advertising but they've also used tactics such as airdrops and token gated Early Access so now I'll pass it to my colleague Pierce to Deep dive into Partnerships it's nice to see everybody it's not

often that I'm up on the stage in front of you usually we're like tucked away in a conference room somewhere but happy to have this opportunity to dive deeper into Partnerships and negotiations and why are we spending time double clicking on Partnerships well they not only can help you make better products they can help you reach a new audience and they can help you drive revenue and when done correctly the ever important rocket ship it can turn into a growth growth strategy in and of itself so it's a big bold statement Partnerships can drive growth what does that mean well you think about Uber and Spotify they entered into a partnership to allow users to personalize the music in their ride

um really cool partnership on the surface very calculated by Uber at a time of hyper competition they wanted to make their product stand out they wanted to attract their market share and a partnership with Spotify was a way to do that low-key they also were driving more app usage while their Riders were in the ride and thus potentially able to monetize ad Revenue while you're in app you think about reaching a new audience Lego and Netflix they just recently partnered in 2019 to bring a Lego set to Market called the upside down the most iconic scene from stranger things so stranger things has been streamed over like a billion hours or some ridiculous metric and a third of that

audience is of the age 18 to 29. so for Lego it's a really authentic way to start engaging With Their audience that's maturing out of childhood and into what they call adults welcome category um and then of course couldn't talk about Partnerships without talking about Taco Bell and Frito-Lay for over a decade the Dorito locos taco has existed and when they first launched this partnership in 2012 Taco Bell literally had to hire 15 000 people just to keep up with the demand in the first year of its existence they did over a billion dollars in sales so it's Partnerships are not just a way to help you make better products reach new audiences or drive Revenue they're a

way to think about growth overall plus they're really really fun I promise you they're fun to think about they're fun to negotiate and they're fun to execute so today we hope to give you a framework that helps you think pragmatically about Partnerships and gives you some tools for negotiating those Partnerships we hear resoundingly from Founders it's really hard to know where to start or even how to start so what we're going to try to do here is mechanize your partnership strategy and help you turn it into a growth strategy so that you can attract engage and convert new users we'll talk about rooting in your growth objectives we'll move on to thinking about a framework that you can prioritize with and then we'll talk

about everyone's least favorite topic the dreaded cold Outreach so to root everybody in an idea of what what we mean by thinking about your growth objectives I'm going to talk a little bit about my time at DraftKings if you're unfamiliar with DraftKings it's one of the largest digital Sports entertainment and gaming companies in the world they have real money products in other words gambling products uh like fantasy sports betting and casino games and I joined to help them convert on a fairly simple but very calculated thesis and that thesis was that there were millions of active monthly users already using DraftKings existing products they had a DraftKings digital wallet that had

positive cash balances and they showed a propensity or behavior similar to that of what we understood to be the nft collector at the time so the thesis was that by launching a web 3 product we could increase engagement and spend with existing products decreased churn and add new users and then cross-sell between the products so what does that do well let's root it back to our growth metrics that helps us lower customer acquisition cost or CAC helps us increase the long-term value of those customers and helps us grow the addressable Market or the tan and so we built and launched the DraftKings nft Marketplace and rainmakers which is a nft gamified

platform and so where does Partnerships come into play well in launching those products we thought deeply about the types of Partnerships that would support the product launches so we partnered with world-class web 3 companies like autograph to bring a better product in the form of digital Collectibles rooted in their legendary roster of athletes originally like Tom Brady then we also tapped into web3 native communities like Moon birds and dead fellas to reach new audiences that maybe weren't even on DraftKings yet but had been collecting in the space and then finally we partnered with global IP holders like the NFL players Association the UFC the PGA Tour to

thoughtfully scale the drops in our Revenue potential over time so working example from start to finish you guys got it right it's not as simple as it sounds we have to talk about foundational Frameworks and building blocks and so I'm going to go back to what Maggie very eloquently described which is a need purpose in stakeholder framework that's really really authentic to web3 or in web 2 terms you could just think about consumers and products so this is a process that should be deeply introspective as a Founder but it doesn't have to be complex in fact it should be really really simple so that you can articulate it if you're having

trouble articulating what you're doing and who you're doing it for this might be an opportunity to course correct so let's take an example IRL EIP eip4337 if you're building to address that EIP maybe you're building with account abstraction smart contract wallets the middle need or purpose should not simply just say account abstraction or smart contract wallet it has to say things that are deeper like single sign-on it has to say key management and Recovery Advanced and gasless transactions automated transactions dig deeper into the need and purpose by being more deliberate with what the need and purpose is you're also able to

open the aperture of who your stakeholders are so with our eip4337 example we're not just talking about you know this one nebulous thing applies to this one cohort we're talking about these very specific Solutions applied to this much broader set of stakeholders so in our example this shouldn't say just wallets it should say individual or individual wallet providers wallet aggregators browser extensions dapps web3 games web 2 platforms by opening the aperture of your stakeholders you also then can start to make more stakeholder purpose pairs which result in more partnership opportunities

okay so like Pie in the Sky you have all these partnership opportunities how the heck are you going to prioritize your resources your time your money your energy well what we encourage you to do is develop this framework or scorecard to be able to score those Partnerships and this is filled in with just some placeholders this is going to completely vary based on what you're building the stage of your development and potentially your philosophical values and ideals but you want to think of this as almost a weighted average or some sort of Blended average where you're going to Output a score based on a potential partner to be able to compare them somewhat apples to Apple the goal is for consistent rubric to be able to measure and compare over time it

can totally change and be flexible but by outputting a score you're able to compare Partners on a Level Playing Field so what do you do with the scores well hopefully you can do this mentally or if you're a paper person like I am you actually get out of little sheet of paper and start drawing logos on slide but the y-axis of this is the score right how valuable is the potential partnership to your business and the x-axis is how practical is it do you have the resources the time money and energy to execute on this partnership and is your partner potentially aligned how hard is it going to be to sell that into them do you have a shared and mutual uh understanding of

the partnership objectives tactical is subjective but it should root you in this idea of what is realistic so let's take a layer one ecosystem there are innumerable number of Partnerships that you could think to satisfy stakeholder and purpose Pairs and some of them would satisfy multiple at a minimum you want to spend your time in the top right quadrant right where things are super valuable and super practical but it's also okay to have stretch goals it's okay to be in the top left quadrant where things are super valuable valuable to you but they might take longer they might require more education hopefully

an exercise like this might show you though if you are not an evm compatible layer one it's unrealistic and potentially not very beneficial to try to convert an evm compatible pfp into your network there's a lot of different examples we can dig into with this but hopefully the demonstration shows that you need a mental framework to be able to prioritize your time and resources similarly in the landscape of Ip licensing traditionally IP licensing is a high margin business the holders of those IP will not do anything that dilutes their margin so it's really hard to negotiate these deals it's really hard to identify the right partners

a 100 year old Media Company might be super high value to you but because it's 100 years old and well established and has valuable IP it's going to be hard to work with them they're going to have rules about where their IP can be distributed and how it's protected and all the things that go into that like take down Clauses and everything so some uh conversely to that you might think about a cc0 pfp it's not very hard to integrate it's cc0 by nature of the Creative Commons you can use the IP in your integration does that mean it's valuable though it might not be because it can be anywhere because it's cc0 so this is again a framework just to keep you rooted in what is truly valuable to pursue as a

partnership and what is realistic to convert on across the landscape of opportunities ostensibly you've identified your top targets now it's time for everyone's least favorite activity trying to find the right people to reach out to and writing to them we used to say hitting the phones but I feel like in now we just have to talk about hitting the keys um so there are things that are native to web3 Discord crypto Twitter Etc I don't want to undervalue the LinkedIn as a platform as our industry is maturing more people are starting to represent their professional identities in web 3 on LinkedIn it's a very powerful tool for being able to identify the right Persona

in terms of titles in terms of posts that they're actively posting about and in terms of connections that they may have because at the end we're all working in networks and connections are nodes and you should definitely leverage them to your advantage so when you find the right person it's time to raise the flag make them realize that they have a problem not like a literal problem but like they have a need and the need that you're building for and then give them an easy path to yes the worst cold Outreach ends with no question and no next step it could literally be anything you could ask them to go for a walk you could ask them for a coffee you could ask them if their

favorite basketball team is the Warriors ideally it would be really related to the type of partnership that you want a broker and your product but do not let a cold email go cold it needs to warm up so you have to give your recipient a reason to respond make it easy assuming you've made it easy and you get to the negotiating table what are you doing negotiating is a topic an exercise that many people find uncomfortable or purely just unapproachable it's often classified or depicted as this super aggressive intense conversation where there's a winner and a loser and it certainly does not have to be that way

there's no shortage of research or literature on the topic of negotiation and so I'm going to show some books that are like my personal favorite books but it's by no means you know kind of uh an endorsement frankly they might not be the right books for you but I encourage you to explore the research and literature that's out there this is a long process developing a style it's like developing a fashion style like it changes over time it evolves with you and matures but we're going to talk about two basic principles that I've found really helpful and hopefully you will too so this is probably not what you thought we were going to start talking about with respect to negotiating but and this is going to date me in 1998 Jerry

Seinfeld released his stand-up I'm telling you for the last time on DVD remember those um and I can remember being a small kid I think I was like seven at the time and we would watch this DVD over and over and over as a family and I'm not going to do the bit because it would be terrible but Jerry has this bit it's called kids up parents down and it's this concept that when your child everything is up right everything in your world is up it's weighed up shut up hold up let me stay up and it really resonated with me like I pictured somebody like literally flicking a chord in my soul when I was eight and it has stuck with me ever since

because kids are literally the best negotiators and why well this is my allowance book from a similar time frame 90 96 97 um and in 96 I was getting six dollars a month as my allowance and then something remarkable started happening I started asking for bonuses uh anybody who knows me this isn't like a far-fetched concept that I want more um but you know I would realize my dad would bring all of our siblings around to the kitchen table we'd sit down with our allowance books and I would be there and he'd be doling out cash and I got the least amount of cash and something didn't sit right with me like why should

I get less money for being four years younger so I started asking for more money and that's because I have nothing to lose as a child literally nothing to lose the worst that could happen to me is like I just keep making six bucks so over time this habitual and persistent ask for four extra dollars converted about nine months later into full-time ten dollars a month so I just asked and that's a concept that's also stuck with me when you're in a negotiation and you're not sure if something's on the table just ask another interesting facet about kids in negotiating is they have no context for losing literally no historical context for losing this is a picture of a

project that I did when I was going to kindergarten um and there's a nice little picture of me and some lovely verbiage about me being nervous and all this stuff and then the answer to what I wanted to learn to do better at that year was jumping 40 feet high like how unrealistic and just like childish and innocent and sweet is that but it's a really interesting concept I don't have any context for 40 feet being impossible in my mind it's possible so what I take away from this is children are the best negotiators because they have nothing to lose and they have no context for losing and now we all know that temper tantrums and crying aren't going to get you very

far in a business negotiation but having those two principles of understanding will make you a very very strong and compelling negotiator now doing a little bit of homework and reading and evolving your idea and your style of negotiating will help you find the right balance so you can think of negotiating as this spectrum of Zero Sum versus win-win and of course some negotiations are zero-sum there will be a winner and there will be a loser there's a fabulous book called Never split the difference and that will help educate you under negotiate tactically through zero-sum outcomes there's also a book called getting to yes getting to yes talks about inventing

Mutual beneficial outcomes maybe they don't exist when you enter into the negotiation but you can find them if you try and that's stylistically where I fall so sometimes it's true that it's zero sum and you can recognize and be good in those situations but you can also control the conversation and make it mutually beneficial for both parties the way that you can start to think about doing that is not by having strict rules rules are too prohibitive they don't allow you the flexibility to respond and adapt your environment instead start to think about principles like ideologically how do you enter into a relationship and how do you navigate negotiating

I don't care if it's a professional setting or a personal setting you have to be interested to be interesting if you're not interested in what the other person is saying what are you even doing in that relationship and that comes forward in negotiating you have to be an active listener you have to kind of set aside your objectives it's okay to recall like as you enter into a negotiation these are the outcomes I want but you have to set them aside and actively listen to your counterparty to be able to hear where they are in terms of the negotiation and how you start to find the middle ground you also need to use something called tactical empathy and this is talked about it never split the difference but not use this with my wife a lot

um you have to put yourself in the position of your counterparty and draw them into your position it's it starts with a lot of questions of like what would you do if or how should I respond and what this does there's a lot of science behind this but it actually neutralizes their brain like they spend so much time thinking about how to empathize with you that it brings down their intellectual ability to negotiate a hard deal so it's been some time thinking about what tactical grade empathy looks like for you and then finally the feature benefit ladder this is a oversimplified explanation of what this is but through a conversation you always want to be leading your counterparty to yes and to understanding why it's valuable to say

yes so this goes along the lines of the book getting TS and creating Mutual beneficial outcomes if you can invent mutually beneficial outcomes and convince the counterparty that what you've invented is the best outcome possible then you drastically increase your chances of arriving at an agreement and having a very very solid good working relationship with your potential partner any questions hi I'm Murat from primeav um can you talk a little bit more about the Tactical empathy uh aspect of it I think you know I can imagine some scenarios where the person just replies like oh you should do this which is like what they want you to do yeah but how do we kind of penetrate that like initial

barrier so that they actually like consider seeing it from your perspective um maybe some best practices or tips around that so it can depend on the situation um but I would encourage you to think about two things the right type of leading question to ask and you can kind of like develop a war chest of these I ask a lot like how how am I supposed to go back to my Executives with that and just posing that question and then leaving a pause for them to answer um you can ask you know how is if you were in my position how would you respond to that and it kind of makes your counterparty contemplate a different scenario which is not the outcome that they're driving towards but the outcome that you have to accept

and so I would encourage you to just think about what are the right leading questions to help my counterparties see things from my point of view ultimately you need to do the same actively to arrive at a you know mutually beneficial outcome um but having those questions like bankrolled in your mind is always a really helpful tactic that's good thank you yeah hey book thanks for the talk and scifo as always I have a question on go to market for Maggie specifically and it's a little bit specific but it's really around strategies for airdrop and how do you think about airdrop as a as a go to market strategy right so how do you think about leveraging airdropping as a strategy for growth and what do you think are the pros and cons of airdrops it's a great question I think uh I would

think about active versus passive so in an airdrop you're actively the the users act passively receiving something right and so unlike maybe an open Edition men where they're going to Mint and they're actively taking an action and so do you want them to basically be taking the action beforehand and then getting something passively or is the action itself meant to be kind of that primer mechanism and I think they're pros and cons to each I'd say the one downside to an airdrop is they have it and then there might not be incentives to continue engaging because it was something they did and then they now received that versus something that's a little bit more active but I I would you know nothing is perfect and I would think about using airdrops in conjunction with other tools because

each tactic that I discussed has its different pros and cons thanks appreciate that how do you think about design Partnerships specifically working with companies and getting them to buy into a product or service that maybe doesn't exist yet I'd say design Partnerships are critical and so when you're just starting out having three to five key design Partners can really help inform that longer term roadmap and I would want to have them in a variety of different areas so if you had three or four different use case focuses having one to two in each of those categories but at the same time I wouldn't get too bogged down in them and so sometimes a feature that a design partner wants might not be something that you end up building or developing

and understanding when and when not to prioritize their their future requests that's that's kind of the art yeah I think the only addition to that would be as you think through those Partnerships and they evolve in their level of maturity and potentially reach the stage of a contractual negotiation making sure that you maintain strict control of your product roadmap to Maggie's point is always critical design partners are 100 necessary and beneficial but you need to be able to have the flexibility and adaptability to you know control your own product roadmap got it thank you hi thank you thanks for all the great advice I had a question around uh approaching pricing when we're kind of moving people over

from you know trial period they like the product they they they're interested so far but is there anything [Music] um you know before we kind of drop the pricing question on them uh anything we should do leading up to that and then uh my other question would be when uh we're approaching somebody new and they asked about pricing right away like how do we answer that when we haven't like fully like assessed the client yet I guess maybe the first question is like is there anything we should do leading up to uh I guess dropping the pricing and like we're transitioning you into a price tier um any way to make that most successful make them excited about it I think one element would be articulating the features and benefit

and so not under pricing just because you're new but really showing them the value of of what the the pricing gives them if you have comparables that's always helpful if they're doing something today that you can map to but if not then it's it's the sign of white space and we have kind of that pricing framework that Jason and I wrote about were there a few different types of pricing models you could consider I think the only additional thing is to consider maybe is the upsell opportunity that you're developing as your as your product develops um and so never never been underprepared is always a good tactic so having an answer prepared whether you want to point to specific pricing or not or use your feature

benefit ladder as a way to upsell them into a pricing tier is an optimal outcome for you know if you're not quite sure yet right maybe just one follow-up uh if they're say working with somebody that's taking care of some portion of you know the same features that we're providing um is it like a tactical way to find out how much they're currently paying for that I say in some cases you could even just ask them and they might want to tell you right because there's there's benefit there but there are other ways to figure it out from different market reports or from just understanding the market thank you for the advice thank you for the talk uh I had a question concerning uh specifically for negotiating L2

Partnerships in terms of like picking out a specific partner do you have any tips for navigating that Arena I mean I think so there's a number of different Frameworks that you can use to potentially approach this um from a technical perspective or from a financial perspective they all kind of materialize into a ranking system right you have to develop a model in your own mind of how you're going to Value the benefit or the costs of selecting a specific partner so traditionally you know that could come down to very technical metrics like you know transactions per second or scalability like the canonical trilemma um from a financial perspective it could come down to you know how rich is the

deal how approachable is it um and then you know using those Frameworks to make calculated bets uh in the end when you're you know thinking about deep Partnerships like selecting a layer two like you need to be thoughtful and understand that it is you know a big step and a big partnership the only thing I would add is this is obviously still evolving so I would think about the partnership over time and making sure that if it's Layer Two that you select and they continue to grow and become potentially the dominant one how does that partnership play out on the flip side if they become less prevalent how does that partnership play out and so just mapping that and what that looks like

awesome well thank you so much for that Pearson Maggie that was fantastic [Applause] [Music]