The Different Shades of Jerk (Customer Barriers)

Joel Hestness is the Cofounder of 3 Day Startup and an Computer Science Ph.D. student at the University of Wisconsin-Madison.

When I first read Steve Blank’s article, Sometimes It Pays to be a Jerk, about a test he ran to filter students from his startup course, I said to myself, “Huh, that’s an elegant result.” But after some thinking, I realized that 3DS has been implementing participant filters in our programs all along, and we’ve experienced these findings as well.  For a standard 3DS program, we layer in numerous mini-tests that filter out weak or unmotivated participants: interviewing applicants, asking them direct questions about their interests and availability, running pre-program bootcamps, and expecting participants to do some work before their program. These barriers help us cut out the participants that may not be invested enough in the process, which allows us to focus on those who are dedicated to being there.

And there’s more to this: While other entrepreneurial programs often use extrinsic motivators (often less effective), 3 Day Startup’s filtering process emphasizes intrinsic motivators as a way to raise flags when a participant may not be a good fit.  For instance, we know that participants will get the most out of a 3DS program if they come in with a fully-baked idea, so we try to emphasize that they should invest some cycles to prepping beforehand. To them, this emphasis is often intrinsically motivating: “I’d really like to have more entrepreneurial skills, because they will help me grow as a person/employee, so I should do this pre-3DS work.”  Indeed, we find that the participants that put the most into program prep are the ones that sprint all the way through their 3DS experience, AND they have the strongest teams and most viable startups at the end, even if they pivoted.  Additionally, our normal program attrition rates are less than 15 percent — pretty solid by Steve Blank’s metric!

Now, compare this to the extrinsic motivators used by many other programs.  Similar to 3DS, Steve Blank asks students to do some work before his course. However, in the test he ran for his recent course offering, he used a fairly arbitrary road block as a filter: students had to make it to the first lecture in order to take the course.  This barrier exercised many students’ extrinsic motivators. For example, it could have cut into their break, increased the costs of switching flights, or not allowed them to take the course at all. I’d be willing to wager that the students that made the effort despite the inconvenience of getting to the first lecture were, in fact, intrinsically motivated by the potential benefits of taking the course.  This is probably why these students made it all the way through.  It would be intriguing to hear Mr. Blank’s thoughts/feedback on this.

An even more illustrative example of extrinsic and intrinsic motivation comes from the differences in filtering participants between 3DS and a standard Startup Weekend event.  Startup Weekend doesn’t filter participants coming into their events, save for charging an entry fee.  The entry fee serves to temper demand by putting a price on participation, an extrinsic motivator; A potential participant may be willing to part with the cost of attending the event should they find something more worthwhile to do with their time over the weekend.  We’ve been to a few Startup Weekend events that appear to suffer greater attrition as a result (e.g. up to 40-50%).  To Startup Weekend, this is probably okay, because their primary goal as an organization is building a very open and welcoming community of entrepreneurs who are always willing to help, even if you don’t share the Startup Weekend experience.  This inviting nature has made them one of the largest global communities of entrepreneurs — an impressive feat.

The examples that I’ve described above are a learning opportunity not only for 3DS or educational programs in general, but for startups as well.  Modulating the size and character of barriers for a customer to use your product/service can profoundly affect the size and interest-levels of your audience.  If you are delivering a product that connects with your customers’ intrinsic motivators or provides them deep intrinsic value, they may be willing to move mountains to use your product or help you build it. These types of products often require a lot of effort to build, but can be deeply rewarding to the market.  On the other hand, your product may be lighter-weight and appeal to customers’ extrinsic motivators, say, by saving them money, time or inconvenience.  In these cases, you’ll need to be careful that there are few, small barriers to getting a customer to use your product – they may be fickle.  However, there may be larger available markets.  Test your barriers carefully and choose wisely!

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