Happy Sunday and a very warm welcome to all the new subscribers! I’m thrilled and honored to have you as readers and truly appreciate your thoughts and feedback 🙏. Each edition of 3 Things will contain a dive into 3 rabbit holes I’ve found myself going down recently. Subscribe to get each week’s edition straight to your inbox and if you enjoy it, please share (I suck at self-promotions so can use your help)! This past week I’ve been thinking a lot about:
NerdWallet for DeFi
Customer Advisory Board Platform
Project Management for Ops
1. NerdWallet for DeFi
Founded in 2009, NerdWallet is a content site that helps consumers find the right financial products for their needs, from the best credit cards, mortgage rates, or student loan refinancing options. The company was started by two former Wall Street guys, Tim Chen and Jacob Gibson, in the wake of the financial crisis and was bootstrapped for the first 6 years before taking on venture capital. They provide the content and advice for free and make money as a lead gen site for the financial service providers. These companies are all too willing to pay quite a bit for each qualified consumer as a new credit card holder, as an example, means a lot of money for the credit card company. In May of 2021, NerdWallet filed to go public at an expected $5B valuation. The company generates $150M in revenue annually with more than 39 million monthly visitors.
While NerdWallet focused on traditional finance, a parallel financial world is now emerging in the Web3 sphere referred to as DeFi or Decentralized Finance utilizing blockchain technology to reinvent how traditional financial mechanisms work. From lending to payments to derivatives to exchanges, DeFi companies are tackling every angle of finance to remove middlemen like banks, brokerages, or exchanges, and replace these intermediaries with smart contracts that execute transactions based on programmatic logic. If you thought navigating the existing financial system was complicated and confusing, just wait until you try to understand yield farming, stablecoins, or oracles 😂. Given that DeFi apps now have over $90B of USD locked and users flocking to join the party as fast as they can, there is a gigantic opportunity to become the NerdWallet of DeFi. Create free content to guide consumers on how to earn money and which DeFi projects are right for them. Work with the DeFi companies to drive users and earn tokens from each project when you send qualified traffic. The exchange can be executed using smart contracts and heck, you can then stake those tokens on an exchange and become a liquidity provider to take advantage of yield farming gains yourself!!
2. Customer Advisory Board Platform
As a startup gets off the ground and searches for Product Market Fit (PMF), some of the most valuable insights and feedback will come from early customers. Some companies seek out “design partners” who agree to become customers and use the product for free in exchange for providing insights and using their specific use cases to co-create the early versions of the product. As a company grows, many will opt to pull together a Customer Advisory Board (aka Customer Advisory Council) which typically consists of senior executives within a small subset of customers who get together on a regular basis to advise company management on industry trends, business priorities, and strategic direction.
When assembling and implementing a CAB, it is important to create a group that represents a wide swath of the customer base, consists of executives who have power and insight into their own industry as well as company trends and priorities, and ideally who are influential and aspirational in their field (which helps bolster the startup brand by association and draws other peer execs to the product). Often, a startup will give small amounts of equity in exchange for joining the CAB and appropriately incentivize the members to provide value to the company and also become evangelists within their industry or sphere of influence. Today, the entire process is done ad hoc and inconsistently among startups yet most companies choose to create one. A company can provide an end-to-end platform to manage CABs. A combination of tech plus services, the company would help find the right execs/customers to include, facilitate regular meetings, create agendas ensuring that the content aligns with top priorities and goals, handle all documentation, allot and manage equity and other incentives, run peer-to-peer events to help the members bond with each other, and facilitate marketing activities utilizing the CAB executives. Since CABs are often set up early in a company’s journey and are ongoing, the product would be incredibly sticky and stay with the company for its entire life making this a lucrative business once it became pervasive.
3. Project Management for Ops
Sales Ops, Marketing Ops, Product Ops, BizOps, RevOps, DevOps, Finance Ops; the number of operations focused roles and positions at tech companies has exploded with nearly every company currently hiring for multiple kinds of “Ops” roles. While each type of Ops role is unique, most operations positions involve working on strategic goals and initiatives across functions. They tend to be focused on identifying and driving towards business priorities, aligning teams, and ensuring projects are executed well and in a timely manner. Often, they are dealing with budgets or a P&L. Each Ops function acts as the COO of their business unit and they serve as the connective tissue for both the function and the company as a whole.
Going off of my “new titles = new tools” thesis, as we see various Ops titles becoming ubiquitous among tech startups and larger enterprises, these people will need specialized tools to help manage and measure their work. Sure, there are plenty of generic project management apps like Asana, Monday, ClickUp, or Trello, but these tools have been built to the lowest common denominator for any and all project management or task management needs. I’d imagine that if you shadowed a variety of different Ops folks you’d notice a lot of similarities in their workflows as well as nuances in terms of which apps and docs they spend their days in. There are already certain platforms aimed at Revenue Operations teams such as Syncari or Openprise, and I expect to see more Ops specific software. I’d focus on a specific Ops team, understand their workflows, the apps they use, and the way they need to track and report any metrics or KPIs and build a specialized platform for that team. Since Ops tends to have a relatively esteemed role on their teams, I’d imagine they would be able to get budget for a platform like this and it would spread quickly via word of mouth as well as people taking it with them when they leave one company and join the next.
That’s all for today! If you have thoughts, comments, or want to get in touch, find me on Twitter at @ezelby and if you enjoyed this, please share with a friend or two!
~ Elaine