BC STARTUP
Saved by @ThomassRichards

Today's thread is on the affiliate business model. Many years ago, I used to be an affiliate marketer. If there is any way to get schooled in marketing, becoming an affiliate marketer is probably the best way.

What is affiliate marketing and why should you care?

Read on >>

 1) Affiliate marketing is selling products or generating leads on behalf of other companies and getting paid a commission for those products.
2) Some notable examples you've seen before:

NerdWallet - you read their articles on best credit cards. You click on a link to one of those cards. You fill out an application. They get paid for delivering that lead to the cc company.
3) In https://t.co/kSfWS69ybp - same thing. Any of their financial products -- you fill out an application, and https://t.co/mCrBT43mOj gets paid for that.

But the affiliate revenue model applies beyond financial services products.
4) Wirecutter -- you see a neat product they review or talk about. You click through and buy.

Wirecutter gets a cut of that transaction.
5) The affiliate business model shows up a lot. And there are a lot of marketers who make a living promoting 3rd party products by being really good are driving traffic to these types of offers.
6) Let's start by talking about the challenges of the model.

At a high level, driving traffic to product offers (of any kind) is REALLY HARD. Specifically, it's hard to keep your customer acquisition costs (CAC) low and make enough money off the commission.
7) In particular, a lot of high volume affiliate marketers like to use ad networks to do this. And at market efficiency, this is near impossible.

For example, if I want to promote Apple Macbooks, I only make a commission on a sale, so I can spend up to a certain limit in ads.
8) But Apple, on the other hand, is making a much higher margin off a Macbook sale, so they can afford to outbid me in ads and spend more per sale.
9) In addition, there are probably a TON of other affiliate marketers that I'm competing with to get the sale. It's a brutal game for common household products.
10) Moreover, you only get the commission if the co can link the sale to you. So you get a special prod link to make this work.

But what if the customer clicks your link to the prod & doesn't buy & later goes to that same product pg on a different computer & then buys?
11) You don't get the credit. You don't get paid. That's it. So you could be driving traffic that you don't get paid on.

Historically, if you were also not the last "touch" w/ the customer, you would also not get paid even if the co could see that you had an initial touchpt.
12) One last issue is that typically customers forget the site who referred them to the end product so it's hard to "own" and retain your audience to increase their LTV over time.
13) For all of these reasons, I generally think the affiliate business model is RIDICULOUSLY HARD.

And anyone considering using it for a startup should probably start by being an affiliate marketer for 2 weeks just to learn.
14) That being said there are a few ways I've seen this work really well.

A) You negotiate and have access to unique products. This mitigates competition in customer acquisition channels. You can also discuss higher commission rates.
15) B) You build an audience around something else. And don't really worry about the monetization optimization at first.

NerdWallet -- community for the most honest reviews
https://t.co/mCrBT43mOj -- keeps all your finances together
16) For both of those sites, monetization isn't in your face, and they focus on retaining the user in the community -- keep you coming back to their site so that over time you will buy lots of products.

You have to be really patient.
17) C) Don't use paid customer acquisition channels because you can't afford high CAC. So you need some level of virality or strong patience via SEO as a channel.

VCs btw don't have patience so likely not VC backable at the earliest stages (which is fine but just know that)
18) D) For affiliate marketers -- offer discounts and coupons to be "last touch" on a sale and have high ad budgets to play with to generate a handful of successful campaigns that convert on offers right away.

(This likely doesn't apply to anyone starting a startup)
19) E) Run the affiliate business model in less crowded geographic markets and/or languages.

One of my acquaintances is a successful affiliate marketer & runs ads for offers in Spanish & the competition for Spanish ads a few yrs ago was basically zero. So her CAC was cheap.
20) F) Negotiate with newer products/companies so that you can make the sale on your site to control the whole sales experience + higher commission.
21) This feels like a niche business model, but it actually shows up all the time where you may not have noticed it.

Even Uber or other cos that have referral codes have marketers racking up free rides / credits -- that's affiliate marketing.
22) Lastly - so if you are using the affiliate model as your startup's business model, think about how you can avoid some of the challenges mentioned above to improve your commissions, reduce CAC / avoid competition, and ultimately "own" the end user to increase LTV over time.
If ppl are wondering how can I sign up for an affiliate mktg prog to see how this works? There are lots incl Google Affiliates, Commission Junction, Amazon Affiliates.

I.e. if you sign up & promote Amazon's products, you will earn a commission of sales:
https://t.co/kDf9PAhhxT

More from Elizabeth Yin

Elizabeth Yin
Elizabeth Yin
@dunkhippo33
Some wed night thoughts on investor “value add”:

1) At the end of the day, money is a commodity. That mere fact should make every vc shudder.

It is amazing how many ppl (incl myself) clamor to get into a commodity business!

2) As such, to differentiate, different investors provide other things beyond money. Sometimes it’s community. Sometimes hiring help. Sometimes expertise or sector-focused networks. Etc

3) And some VCs are truly value add! For example, if I had an edtech co, I would hands down raise from @jwdanner - he has been there as an entrepreneur, built schools, and invested in so many hit edtech companies.

4) But at the end of the day, regardless of who invested in you, it’s the founders + team who are doing all the work.

5) when I think about what I’ve done for my own founders, it’s ranged from doing intros (mostly to other investors) to cust acq advice to feedback etc

But the reality is - all of my founders would’ve figured out how to get that intro or that piece of advice w out me
STARTUPS , INVESTORS
Elizabeth Yin
Elizabeth Yin
@dunkhippo33
Today's thread is a continuation on *how* you generate momentum in fundraising.

Here's a rough conversation I had with a founder (called 'C') over the course of days a few months back.

Read on >>

1) C: I'm having trouble raising. VC A and VC B are taking so long to get back to me.

Me: Oh, when did you meet w/ them?

C: 3 weeks ago.

2) Me: Oh, are you mtg w/ anyone else?

C: No, I got busy working. I had all these sales calls to make.

Me: That's the problem - there isn't a reason for them to move quickly. There's no investor at the table.

3) C: But I have all these sales calls to make!

Me: I really don't have a great answer for you here. This is probably the hardest part about fundraising - juggling your actual job w/ your fundraising job, which is full-time too.

4) Me: You need to hand off your sales calls to your co-founder. And then you can do mtgs back to back.

C: Ok...

[some time passes]

C: Ok - I'm ready.

Me: How much do you want to raise and what are you using the money for?
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Elizabeth Yin
Elizabeth Yin
@dunkhippo33
A thread on employee equity in early stage startups -- what are the compensation norms? What every early employee should ask? Some thoughts on whether the structure is fair.

Read on >>

1) First, there are NO NORMS! Hah. I have literally seen everything from giving early employees no equity to giving employee #1s near co-founder level of shares.

But what is more common than not?

2) In the Silicon Valley, if you're hiring your 1st employee, & you've raised NO $$ & are paying very little (e.g $0-$10k / yr or thereabouts), your first employee is basically a co-founder.

And the equity tranche for employee 1 should be closer to a co-founder level.

3) For ex, a friend of mine gave his employee #1 10% (vesting over 4 yrs of course) of the business. This employee was only getting his housing paid for. And this was 10 yrs ago, so it was during the bust.

4) On the flip side, if you have raised some $$ & are paying employee #1 near mkt rate, typically I see around here ppl get 1-5% (w/ vesting).

Caveat - near mkt rate doesn't mean compared to Google or FB salary rates. I mean compared to "normal big cos"
STARTUP
Elizabeth Yin
Elizabeth Yin
@dunkhippo33
Today I want to talk about the legal aspects of startups. How to set up? How to think about legal costs?

Fun!

Read on >>

1) Lawyers are expensive -- oof! A startup lawyer can cost you $300-$1k per HOUR! An associate paralegal may be slightly cheaper. But still pricey.

What do you need from a lawyer?

-company setup costs
-doc creation and review for financing rounds
-exit negotiation

2) For the purpose of this thread, we're just going to focus on setup costs, because this is where I see the most mistakes.

Once you get going, you may quickly realize you need a better lawyer - hah - and that generally helps w/ solving for financing rounds and exits

3) If you want to potentially raise money from VCs, you'll want to set up as a Delaware C Corp. If you don't ever want to raise from VCs, an LLC is fine.

Lots of ppl start out as an LLC because you can get tax benefits if you are not profitable.

4) But to me, if you know you want to raise VC money, it feels a bit penny wise / pound foolish, because you will need to spend $$ to convert your LLC to a Delaware C corp.
STARTUPS
Elizabeth Yin
Elizabeth Yin
@dunkhippo33
Saturday thoughts on funding: Where it helps. Where it doesn't. And how it affects team, success, and PM fit.

This is just my $0.02 after looking reviewing 30k+ early stage startups personally and having led 350+ investments across 2 VC firms & as an angel.

Let's begin! >>

1) Money is great to have in building a startup (for the least dilution and pain possible) That's true and always will be true. 😆

But just like how money can't buy you happiness, it also can't buy you PM fit.

2) PM fit is the holy grail for software startups. (we're not talking biotech - if you have a cure to cancer, I guarantee you everyone wants it).

But for software startups, it's unclear if ppl want your product at your price pt.

3) If you don't find PM fit, in this day and age, you will be able to get some sales. Maybe even say $1m in sales (or more!) per year, and you can still make a living.

But having sales does not mean that you have a repeatable customer acquisition process that can be sustainable

4) As an aside, that is why we invest at pre-seed & don't care about startup traction, because I don't believe traction at the earliest stages suggest PM fit. Traction only shows that a founder can execute (& that's impt too) but there are other ways to assess execution earlier.
STARTUPS

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Brian Bourque
Brian Bourque
@bbourque
22 startup principles to scale your company in 2022:

1) The obstacle is the way

Every hard problem you solve is a moat that others will shrink from.

Most people don’t have the stamina for hard work.

Challenges completed are insurance policies against competition.

2) Sell your story, not your product

Your company isn’t a product, it’s a story.

Great stories attract great employees and great customers.

Sell your story.

3) Focus on leverage

Points of leverage are areas where inputs can disproportionally affect outputs:

- A better conversion funnel impacts all sales
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4) Focus on customers, not competitors

Success comes down to whether people will pay you to solve their problems.

Competitive intelligence is useful to understand where other attempts to solve a problem fall short.

But the customer’s actions speak loudest.
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ᴜɴᴍᴏᴅᴇʀɴ...
@UnmodernM
Your 9 to 5 job can transform you into a man of value.

Stop working for the money. Work for authority.

This is a lesson from my dad.

A life hack.

Thread

You spend at least 40 hours a week at your work to make money.

Thats over 2000 hours a year. If you want these hours to mean more than just money, & help you develop your character,

then your approach towards work must change.

Its an overlooked topic that industriousness has tremendous mental & psychological impact on men and their transformation of becoming high value.

Here's a step by step blueprint on letting your job mould your character.

If you want your job to infiltrate your personality and mould you into a man of value,

you need authority.

So the first step is to assess the landscape of your job & whether you are able to attain this authoirty.

If you're in a work environment that makes you a supplicant to every person, quit your job.

I never recommend rash decisions, but working in a place where you are NOTHING but a subordinate, with ZERO opportunity to move up,

is psychologically damaging to your manhood.
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TY FRANKEL
TY FRANKEL
@THETYFRANKEL
How to go from $0 to $10K/mo and quit your 9-5.

A thread.

Let's say you have a 9-5

You make anywhere from $40-100K

Not bad

but you hate your Boss

You hate the job

and you KNOW your dream life doesn't include a 9-5 Job

Your goal is to QUIT

I will show you Exactly how

Keep reading

First thing - STAY at your 9-5

for now, at least

You'll quit once you hit $5K/month

If possible, systemize your 9-5 role

Create systems, hire a Phillipino VA

Buy back your time

If you have 3-4 hrs/day at your 9-5

to build your own Business

it's VERY powerful

OK, Step 1 - REFLECT

Assess yourself

Ask

"what am I good at?"

"what am I passionate about?"

"what kind of life do I want?"

"where do I have leverage?"

"where do I have connections?"

answer these Q's

Step 2 - PICK NICHE

Marketing is the industry I rec getting into

Pick one of these 👇

NICHES
- Paid Ads
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Sohaib 17 weeks ago:

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Sohaib now:

• 25,000+ followers
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Here are 7 simple things that helped me build a 25K+ audience:

👋 Join +4,143 others in Growth Tribe Newsletter

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Justin Kan
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@justinkan
I just gave a talk to the W2021 YC batch. It's my favorite startup audience to talk to. Here are some of the highlights:

Finding product market fit is the critical thing to do in a startup.

Everything else: demo day, what investors you get, how much you raise, what press covers you -- it is all window dressing.

Many founders don’t want to talk to their customers because it makes them vulnerable, because it's hard work, because it's scary. Creating a tight feedback loop with customers is the one thing that will help you discover PMF.

If a customer isn't one of your cofounders, try to create a customer panel that allows as tight of a loop as possible. Call them daily. Put them in your Slack.

My Twitch cofounder Emmett Shear has a great analogy on PMF here: it's like rolling a boulder downhill.
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The Straddle is my favorite trade these days. But more often than not, one needs to adjust to make a good return from it. There are many ways to do this depending on your view, psychology and imagination. Will discuss a few that I use

The Straddle is a delta neutral strategy and it is important to keep deltas in check during the course of the Trade and not let them run away from you. Of course Volatility is the elephant in the room- but not going there as that will require a separate discussion

The first and most common method is to go 'inverted.' That is to say to shift the untested side to generate additional Premium and increase the runway to Breakeven. So if you start with a Straddle at 700 and price goes to 740, you can move the PE up to say 720.

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MaMaMia 🇬🇷🇨🇾🇦🇲 Support...
@MaMaMia73189983
Following @BAUDEGS I have experienced hateful and propagandist tweets time after time. I have been shocked that an academic community would be so reckless with their publications. So I did some research.
The question is:
Is this an official account for Bahcesehir Uni (Bau)?


Bahcesehir Uni, BAU has an official website https://t.co/ztzX6uj34V which links to their social media, leading to their Twitter account @Bahcesehir

BAU’s official Twitter account


BAU has many departments, which all have separate accounts. Nowhere among them did I find @BAUDEGS
@BAUOrganization @ApplyBAU @adayBAU @BAUAlumniCenter @bahcesehirfbe @baufens @CyprusBau @bauiisbf @bauglobal @bahcesehirebe @BAUintBatumi @BAUiletisim @BAUSaglik @bauebf @TIPBAU

Nowhere among them was @BAUDEGS to find
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