The 3/10/30 Rule: Why I'm Ignoring Competitors and Growth (For Now)

Hello Predictable Revenue community,

Book update: The Terrifying Art received a couple of high profile reviews on LinkedIn this week, check out the reviews from John and Erik after the PS.

Community update: today’s post was inspired by last week’s Founder Revenue Meetup, our next event is January 9th at 930am PT. Hit me back if you’re interested in joining.

An ask: I’ve noticed a significantly higher number of folks subscribing to this newsletter over the last week or two, if that’s you, hit reply and let me know where you came from. I’m super curious because I haven’t done much on my side to grow and I’d love to solve the mystery.

Onto the newsletter…

I have something fun to share, I'm working on a new startup. It’s called ReplyLoop and we're focused on solving email for property managers.

Today’s post chronicles what I’ve done so far and what I’m planning to do next. I initially started writing a version of this to share with my co-founder but then decided to open it up to all of you.

Before we launched anything, I ran 50 customer development interviews. I started with commercial property managers since my wife is one, a natural starting point. But when I started outbounding for interviews, residential property managers had a much stronger reply rate.

Commercial was interesting, but getting our first customer there would mean much higher MVP requirements. Since we're focused on empowering email with workflow and AI, we wanted to get the app into users' hands as fast as possible. That pushed us toward residential.

After those 50 interviews, we had a good idea of what we needed to build and who we needed to build it for. Then came this awkward period where more customer development would mostly tell me what I already knew. It would still build valuable connections, but what I cared more about at this stage was valuable connections, not incremental validation.

So instead of pressing on with more interviews, I pivoted to starting a podcast.

My thesis was simple: the Predictable Revenue podcast helped me build my network and knowledge base tremendously. Having a similar head start in the property management space would be exceptionally valuable.

So I got to prospecting for guests. I sent 1,200 emails, received 72 replies, and booked 35 pre-interviews. I've recorded about 20 episodes so far. Some are booked for next year. Some ghosted me.

After every episode, I ask the same question: would you be open to giving me feedback when we have our next thing ready? Mockup feedback. Prototype feedback. MVP feedback. Advice.

From this, I've continued to learn about the space, the tools, and the challenges. I've met a bunch of super interesting people. One of them really wanted to be one of our first users after hearing what we were working on.

The MVP isn't even ready yet, but I've used the podcast to meet people and select my first three design partners. The cool part? They're already fans. We met them through the podcast or customer development, we've spoken multiple times, and they've been involved in shaping the direction of the product from an early stage.

We showed it to them last week for the first time, and their response was pretty exciting.

But I've resolved not to screw this one up like I did with Carb.io.

With Carb, I killed it with my own greed. I wanted the glory of scaling from $0 to $1M ARR ($83,333 MRR) as fast as possible. We got there in three months, and it killed the company. (More on that genius move here)

This time, I'm following 3/10/30

My play this time? Make 3 people insanely happy with our product. Let them use it for free, because it's so early that it really sucks and barely works. Then I’ll let their feedback drive our development. 

Note, these questions were inspired by Dave McClure’s Pirate Metrics framework.

The first question isn't about growth or revenue. It's about retention: What do I need to build to get you to keep using it?

Once they're using it regularly, once retention is real, then I ask: What do I need to build to get you to pay for it?

Payment isn't about the money yet. It's about commitment. It's a signal that they're serious, that this solves a real problem. I might charge $20/month for something that should cost $200/month. The price doesn't matter. The credit card does.

Once they pay, the next question is: What do I need to build to get you to refer me to three friends?

That's the goal. Because referrals are the single strongest signal of product-market fit I know.

Once that's working with 3 users, I push out to the next 10 and repeat the process. You might start at the retention step or jump straight to referral for this round depending on where your product is at.

Once I've completed the loop with 10, I'll ask for three referrals from each which gets me to roughly 30 active users. From there, don’t look too closely at the math here, another round of referrals gets me close to 100 active users.

If I can get to 100 using this method, I think we'll have something real that might be ready to  support a GTM investment.

Why This Matters

This loop focuses on one core idea I've learned the hard way: the strength of product-market fit is a multiplier of your go-to-market efforts. Every salesperson knows this intuitively, the more the market needs your product, the easier our job will be.

Your referral quotient, the percentage of customers who refer you to another customer, is the best measure of PMF I know. My first and only goal right now is strengthening PMF.

Think about it this way: if you spend a dollar to acquire a customer worth a dollar, and they don't refer anyone, you're just breaking even. But if you spend a dollar to acquire a customer worth a dollar, and they refer you to three other customers, that dollar turns into four. That's where you get magical, compounding growth.

Most companies skip this step. They rush into "professionalizing" go-to-market or hiring a sales person before they've exhausted all investments in making the product better and increasing their ability to keep customers longer.

I've helped enough companies waste money on outbound programs that weren't ready. Programs that weren't going to be profitable, or weren't even the right investment in the first place. So I feel like I have a responsibility to say: invest in making the product better first.

If your customers aren't making it past the first year, your cash is better spent reducing churn than on speculative go-to-market investments.

The Hardest Part

My co-founder Matt asked me about competitors the other day. There's another team building something similar for property managers.

My answer: Competitors don't fucking matter right now.

The only thing that matters is making our first three users happy. Then ten users happy. Then thirty users happy.

I used to obsess over competitors. With Carb, I only cared about achieving feature parity with Outreach. The team begged me to let them prioritize stability and quality of life features but I refused. Instead, I kept pushing the team to build a calling feature so that I could say we were multi-touch. 

Instead of focusing on making the thing our users loved better, I was focused on someone else’s company and what I thought their users loved. 

That's the thing I missed. That's what killed us.

If we do this right, if we make 3, then 10, then 30 users truly happy, there will be space in the market for us. And if a better-funded competitor enters the space? As Seneca would say, “that’s outside of our control, so who gives a fuck?”  

The Critical Idea: Relationship First

Everything I've done for ReplyLoop has been relationship first.

That's why I've been running a podcast. I'm not recording it to generate leads or build a content engine, though it does both. I'm doing it because I enjoy those conversations. If all I get is interesting discussions and content for the blog, that's a total win.

If someone on the podcast mentions they're struggling with something I can help with, I'll offer. And if that turns into revenue? Great. But I'm not doing this for the revenue. I'm doing it because it helps people and keeps me connected to the space.

This newsletter works the same way. I'm not writing to sell Predictable Revenue services. I write because I have thoughts during the week, customer interactions, things I'm happy or stressed about, and I think founders might find them useful.

It's my weekly journal. And because my future customers are founders, it's an authentic way to connect.

Between the podcast and the newsletter, I've generated about 50% of PR's revenue this year. The other half came from referrals. Not from aggressive outbound. Not from ads. From relationships.

What Comes Next

Right now, I'm obsessing over Lance, AJ, and Sarah. My first three users. I'm showing them buggy software. I'm asking them what sucks. I'm asking them what they need to keep using it.

I'm not thinking about scaling. I'm not thinking about a waitlist. I'm not thinking about investors.

I'm thinking: what do these three people need to be insanely happy?

Once I figure that out, then I'll think about ten.

Then thirty.

Then maybe, maybe, I'll think about growth.

What's your take? Have you fallen into the growth trap before launching? Hit reply and tell me about it.

Collin 

PS - more reviews came in this week for The Terrifying Art of Finding Customers, if you’ve made it this far in the newsletter, you’ll probably enjoy the book. Pick up your copy here or post your review if you already have yours.

Shoutout to John for this one, he’s the CRO at Orum and a past podcast guest.

Shoutout to Erik for this one, he’s a long time reader and replier.