Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

How to Kill a Startup Idea with Google Keyword Planner and AdWords: A Case Study

psl.com

Post reply on HN
Print view View original

171–180 of 193 posts

Re: How to Kill a Startup Idea with Google Keyword Planner and AdWords: A Case Study

#171

Post by rchaud »

justaguyhere wrote: post #6

Wow, didn't realize adwords and FB ads are so expensive. How do small businesses compete? are there any alternatives for those with smaller ad budgets?

They used extremely broad keywords and phrases that are by definition expensive to bid on. For example, one of the terms in the screenshot was "bass lessons".

What is that? Bass guitar or bass fishing? If this were a real business, not only would you be overpaying due to poorly phrased, non-specific ad title, you'd also be hit with Quality Score penalties by Google if you had too many users clicking through in search of bass fishing lessons and exited the page when they realized it was bass guitar.

Re: How to Kill a Startup Idea with Google Keyword Planner and AdWords: A Case Study

#172

Post by chasd00 »

rchaud wrote: post #164
chasd00 wrote: post #159

Earlier quoted context omitted.

money is money IMO. If the business turns into a consulting business because that's where the money is then so be it.

during a business downturn, it can be hard to get consulting contracts as everyone is under pressure to cut costs. That's when having a viable software business can be helpful.

i totally agree, i was being overly terse. To me, if something is working well then you should do more of it but, yes, you have to manage risk and see the whole picture. Like everything, it's a balance.

It's counter intuitive but in downturns consulting can tick up. The first place companies go to look to reduce cost is headcount but the work still has to get done. In come the consultants to implement a new system to increase efficiency and reduce headcount (it rarely turns out that way though). Also, I think it's easier to finance money for consultants than FTEs because of where the expense falls on the accounting books.

Re: How to Kill a Startup Idea with Google Keyword Planner and AdWords: A Case Study

#173

Post by Jasper_ »

Traster wrote: post #144
vi-mode wrote: post #129

A wall of text intended as smart content marketing to get some awareness for a rather unknown investment firm or incubator--Crunchbase didn't show any raised funds, so I don't call them VC. The long, over-polite text, the fake landing, the ad test weren't required in the first place. Why: The immediate answer every experienced VC would give is a simple 'no, this isn't a VC case' without all this fuzz and waste of tim…

Counterpoint: Wag raised $300m for an almost identical idea.

And how's that working out for them?

Re: How to Kill a Startup Idea with Google Keyword Planner and AdWords: A Case Study

#174

Post by MattSayar »

Negitivefrags wrote: post #133

Can someone explain to me how this is legal? False advertising laws exist and this is literally marketing a non-existent product. And even if it’s not illegal, I don’t understand how you can just be okay with lying to people. Everyone in this thread seems to just be totally okay with this and I’m super confused about it.

Yeah, all I could think about was how crap this seems from a customer's perspective. If I'm trying to find lessons, and they promise lessons, why can't I get lessons? Not very customer-friendly, and since they're going to kill it, the people who signed up are just left scratching their heads that nothing happened.

Re: How to Kill a Startup Idea with Google Keyword Planner and AdWords: A Case Study

#175

Post by dragonwriter »

rchaud wrote: post #170
dragonwriter wrote: post #27

Earlier quoted context omitted.

> before the iPhone was invented, there were ZERO searches for the term "iPhone". Before the Apple iPhone was invented, there were probably some searches for “iPhone” because infogear had a product with that name in 1998, and Cisco (who has purchased infogear) started using it for Linksys products not long before the Apple iPhone launch.

there was also the Moto ROKR, which was a Jobs-blessed product. But in any case, keyword research isn't just about punching the exact term into a search engine. It's about looking at all the different combinations of terms that would identify user interest in your product. For the iPhone that would have included search terms for "camera phone quality", "phone with web browsing", "phone with headphone jack" etc. At th…

> At the time, the vast majority of phones came with a non-standard 2.5mm jack for a wired headset.

The 2.5mm jack used on pre-iPhone wireless phones wasn't non-standard, it was a pre-existing, widely adopted standard for hands-free phone headsets established initially for cordless phones (the short-range ones with landline base stations) that was adopted by wireless phones because it was what every wired phone headsets on the market used.

Re: How to Kill a Startup Idea with Google Keyword Planner and AdWords: A Case Study

#176

Post by TheKarateKid »

anstosa wrote: post #23
crikli wrote: post #21

So...to me this article illustrates the dramatic differences in objective and mentality between bootstrappers and VCs. This VC looks at this idea, figures out that in order to own the market and make $fuckton, they'd have to spend > $fuckton. Decides to bail. As a bootstrapper of businesses, I look at this case study and go "well yeah of course it'll take $fuckton because you're haven't focused on a narrow enough nic…

Ansel from PSL here. Absolutely. Because we're venture-backed and are spinning out venture-backed companies, we are limited to billion dollar ideas. It's not uncommon for us to kill great ideas that could "only" make tens of millions of dollars. We're hoping through blog posts like this and other means to be able to share more of them because we want those companies to exist, we're just not set up to create them!

I understand the logic, but I can't help but feel that this type of assessment is really shortsighted.

Would Facebook have passed this "test"? There was Myspace and Friendster dominating. How about Instagram? Why would anyone want to share photos elsewhere when everyone posted their lives on Facebook?

We all know how those stories ended.

Your firm's method only addresses the current market in current conditions. Having the foresight to see the currently unseen before anyone else is what yields amazing results. And if this is the main reason for killing something like this off... let's just say I'm glad I don't have my funds there. :)

Re: How to Kill a Startup Idea with Google Keyword Planner and AdWords: A Case Study

#177

Post by tobr »

libertine wrote: post #166
tobr wrote: post #122

This might come off as awfully naive, but this doesn’t sit right with me: > XYLO's mobile music lesson technology is the easiest way to learn new music, right from the comfort of your home. Our platform can teach your child any instrument on any schedule, and let them replay lessons forever. As far as I understand, this is... a complete lie? You just made some crap up to see if you can make people click?

You have platforms that thrive on this : Kickstarter, Indiegogo. They are filled with concepts, prototypes, what ever that's sold as end products. Yet they ask for money, here it's offered the possibility to get more information.

Yes, there are many people who lie. That’s what makes it a problem, just like with other types of pollution.

But in my experience your characterization of crowdfunding is mostly wrong. While projects tend to describe their product as they intend for it to be in final ready form, the whole concept of crowdfunding makes it clear enough that backers help fund something that isn’t yet a reality, and that there is risk involved.

Re: How to Kill a Startup Idea with Google Keyword Planner and AdWords: A Case Study

#178

Post by zwendkos »

FWIW, my company, TrueFire, is one of the industry leaders in music education. We were bootstrapped, focused on a niche of the market first (intermediate to advanced video lessons for blues, jazz, etc = older men with expendable income), and have grown steadily since then. We were just acquired by a private equity firm and merged with another big competitor in the space (JamPlay) to form a new company dedicated to dominating this space. So... it is possible to not go the VC route and be (very) successful, albeit not $Bs.

Re: How to Kill a Startup Idea with Google Keyword Planner and AdWords: A Case Study

#179

Post by anstosa »

snowwrestler wrote: post #87
anstosa wrote: post #23

Earlier quoted context omitted.

Ansel from PSL here. Absolutely. Because we're venture-backed and are spinning out venture-backed companies, we are limited to billion dollar ideas. It's not uncommon for us to kill great ideas that could "only" make tens of millions of dollars. We're hoping through blog posts like this and other means to be able to share more of them because we want those companies to exist, we're just not set up to create them!

Have you found many billion-dollar ideas by following this ad-testing methodology?

We have spun out 20 companies over the last 4 years which we are confident meet this criteria using this methodology. All are venture backed (led by investors other than us) and still operating (except for 1 which sold to Nike last year)

- Ansel from PSL

Re: How to Kill a Startup Idea with Google Keyword Planner and AdWords: A Case Study

#180

Post by anstosa »

arminiusreturns wrote: post #82
anstosa wrote: post #23

Earlier quoted context omitted.

Ansel from PSL here. Absolutely. Because we're venture-backed and are spinning out venture-backed companies, we are limited to billion dollar ideas. It's not uncommon for us to kill great ideas that could "only" make tens of millions of dollars. We're hoping through blog posts like this and other means to be able to share more of them because we want those companies to exist, we're just not set up to create them!

Does this apply to the vast majority of VC's? So if I want to do a yc pitch it needs to be able to have unicorn level potential? Who would you target as investors for tens of millions ideas if so? I'm guessing a larger focus on angels and IB's after a more proven, traditional profit model is shown (often a much different model than VC-startup profit model).

Yes due to how the economics of traditional venture funds work, in order to achieve the returns that limited partners expect, investments are made in companies with unicorn potential. Some will do well, most will fail, sometimes one will actually become a unicorn but because you don't know which is which you need every at bat to have a path to a home run.

This means that if your business is the right shape, VC is a fast way to raise a tremendous about of money.

But that's NOT to say that every company can or should raise a tremendous about of money. There are less traditional VCs, angel investors, debt, and other financial vehicles that can help businesses succeed. There are tons of examples of companies worth hundreds of millions of dollars who raised little or no money to get there (Webflow and Atlassian are two top-of-mind examples).

- Ansel from PSL

Post reply on HN