Patrick McKenzie

Principles are our summary of their public statements.

• Avoid High Barrier Markets

  Strategy

  Focus on niches with lower barriers to entry and fewer advertising restrictions rather than crowded, highly regulated markets like gambling.

  2 more supporting quotes are in the member records.

  Source Unveiling The Software & Market, 2006  (opens in a new tab)

• Identify Stranded Assets

  Strategy

  Look for functional assets that have already paid their fixed costs but lack a local consumer, as they offer opportunities for high-margin utilization.

  3 more supporting quotes are in the member records.

  Source Markets in power, 2022  (opens in a new tab)

• Minimize clicks to conversion

  Product

  Always look for ways to reduce the number of steps or clicks a user must take to reach the desired action.

  2 more supporting quotes are in the member records.

  Source Keeping The User Moving Towards Conversion, 2009  (opens in a new tab)

• Know When to Hire Professionals

  Hiring

  Handle simple administrative tasks yourself to save money, but outsource to experts once the situation becomes brain-intensive or complex.

  3 more supporting quotes are in the member records.

  Source Taxes Don't Have To Be Pain, 2007  (opens in a new tab)

• Read the Annual Reports

  Learning

  Before assuming a business is inefficient, one should study their financial disclosures to understand their actual cost structures, such as physical infrastructure and compliance.

  Supporting quotes

  • “I broadly think people overpredict evil and underpredict competence. I thought I was sophisticated for believing this, and then got to my adult life and realized, "Oh, wait, evil actually exists.”

  2 more supporting quotes are in the member records.

• Ignore Surface-Level Industry Doom

  Mindset

  Broad media narratives about the death of an industry are often wrong; making life decisions based on surface-level jokes or trends can lead to missing great opportunities.

  Supporting quotes

  • “Clearly, the successful engineers in the future will be playing a Venn diagram game where they do one hard thing that is engineering and one hard thing that is speaking a foreign language.”

  2 more supporting quotes are in the member records.

• Leverage Isolation for High Output

  Productivity

  Lack of social outlets or distractions can be a powerful catalyst for developing high-leverage skills like writing.

  Supporting quotes

  • “The compounding effects of writing more are responsible for both a lot of the good stuff that has happened to me and a lot of the good stuff that I've been able to accomplish in the world.”

  2 more supporting quotes are in the member records.

• Visual Polish Drives B2C Sales

  Sales

  In the B2C market, the aesthetic quality of the user interface, such as professional-looking buttons, directly impacts sales conversion.

  2 more supporting quotes are in the member records.

  Source Bingo Card Creator Goes Web 2.0, 2009  (opens in a new tab)

• Outsource Specialized Tasks Early

  Hiring

  Identify areas like web design or legal work where experts can add more value than a founder's DIY effort.

  Supporting quotes

  • “I'm decided on developing this semi-publicly - I'll be publishing the market, the spec, the thinking behind it, pretty much everything but the source code.”

  2 more supporting quotes are in the member records.

• Reduce friction for non-technical users

  Product

  Simplify complex tasks into wizards or menus because what seems easy to a developer is often a barrier for the average user.

  2 more supporting quotes are in the member records.

  Source Must Not Get Blinded By The Trees..., 2006  (opens in a new tab)

• Track conversion rate improvements

  Marketing

  A founder should monitor the ratio of trials to purchases to identify what drives growth beyond just traffic volume.

  1 more supporting quote is in the member records.

  Source A Happy Milestone, 2007  (opens in a new tab)

• Prioritize Niche Pain Points

  Finding ideas

  Focus on finding an unfilled niche where people are actively suffering from a problem. If you are the only one providing a solution, customers will pay regardless of how simple the software seems to others.

  2 more supporting quotes are in the member records.

  Source The Pros and Cons of Java for uISV, 2006  (opens in a new tab)

• Build for the non-technical majority

  Product

  Small business owners often lack the technical skills to use complex tools; creating a simple, friction-free UI can disrupt established market leaders.

  3 more supporting quotes are in the member records.

  Source Bringing A/B Testing To The Fortune 5 Million, 2009  (opens in a new tab)

• Leverage existing open source assets

  Productivity

  When budget is limited, use high-quality open-source templates to bridge the gap in your own skills.

  Supporting quotes

  • “I am a fairly competent HTML programmer and was going to bang out my web site by myself (contrary to my own advice below, which was hire an expert: I just don't have it in my shoestring budget).”

• Learn and Share in Real Time

  Content

  Documenting the learning process publicly attracts help from experts and builds a community around one's work.

  3 more supporting quotes are in the member records.

  Source I'm Joining Stripe to Work on Atlas, 2016  (opens in a new tab)

• Scale Support Through Product Design

  Product

  Reduce support volume by making the product immediately usable and fixing recurring bugs that trigger inquiries. If a feature requires repeated explanation, it is a design flaw that should be fixed in the code.

  3 more supporting quotes are in the member records.

  Source Support Does Not Scale. Customer Service Does., 2006  (opens in a new tab)

• Treat registration as a salesman

  Marketing

  A registration system should encourage users to pay rather than punishing them for trying the software.

  3 more supporting quotes are in the member records.

  Source Everything You Need To Know About Registration Systems, 2006  (opens in a new tab)

• Protect staging from real-world side effects

  Risk

  Use whitelists for emails and phone numbers in staging to prevent accidental automated communication with real customers during testing.

  Supporting quotes

  • “if you have a repeatable procedure for provisioning a production system, then when disaster strikes you will be able to confidently execute that procedure”

  2 more supporting quotes are in the member records.

• Segment Ads by Specific Pain

  Strategy

  Create separate ad groups for different user problems to ensure the ad copy and landing page are highly relevant to the searcher's intent.

  Supporting quotes

  • “There are only two numbers you care about: CR and CPA. Everything else is noise - potentially meaningful noise when you're optimizing your ad, but otherwise its just noise.”

  2 more supporting quotes are in the member records.

• Suppress your ego for profit

  Mindset

  A business owner should prioritize long-term revenue and mental health over winning an argument with a rude customer.

  3 more supporting quotes are in the member records.

  Source How To Deal With Abusive Customers, 2007  (opens in a new tab)