Startup Launch Lessons from Color

04/06/2011

A couple weeks back Color, launched an app for “taking pictures together.” The company raised a large amount of funding so naturally expectations were high. The reaction online to the launch ranged from completely predictable to rather surprising. Here are some marketing lessons I think startups can learn from their launch and the reaction to it:

1/ Tell a story or folks will make one up for you – Most of the coverage around Color’s launch focused on the large amount of money they raised. That’s a story angle the company and the VC’s should have anticipated. But as far as I can tell, the company did not have a clear story to deliver around why they raised or were worth that much money or what they planned to do with the capital. Bloggers and journalists quickly filled this information vacuum with guesses ranging from the plausible to the utterly ridiculous (they’re building a location-based ad platform, the team is amazing, the VC’s are nuts, VC’s piled on out of fear of being “left out” and a bunch of other stuff). I believe that the coverage would have been different if they had announced the funding with a clearly articulated story around it and then participated in the dialog that followed in a straightforward manner.  Yes, us tech folk are a gossipy bunch but we are a million times worse when something appears to be a mystery or a secret.

2/ Use cases are important, even for early adopters – Occasionally companies launch without a clear idea of how their product will be used and once users figure out some killer use cases, adoption skyrockets (Twitter). For the rest of us it usually goes more like this – folks download the app, fire it up, scratch their heads for 30 seconds and then delete it.  Sometimes they write reviews to express their disappointment and frustration. Color launched with a single-page site and a paragraph of text. I went looking for a demo or an FAQ – nothing.  A few screen shots or hints about how your product could be used will help your early adopters stick around or at least be less cranky if they decide it isn’t for them. The crazy thing is that within a week they had a demo and an FAQ posted (which are both simple and great). If it were me, I would have delayed the launch for a week to get those items posted to make sure I didn’t frustrate my crucial first wave of users. If I weren’t writing this post, I’m not sure I would have thought to go back looking for those a week later.

3/ Beta? What Beta? – Interestingly, the fact that Color launched as a beta was barely mentioned in the press coverage. All of the coverage I read mentioned simply that they had “launched.” Startups have been using the ol’ “it’s beta therefore we don’t have to have it all figured out yet” trick for products that are clearly beyond beta for so long that the word is meaningless. Like it or not – real beta’s are closed and open beta’s are “launches” that come with non-beta customer expectations.

4/ You can’t launch quietly if you’ve raised $41 million – yeah, OK, you and I will likely never need this advice but if there was ever a doubt in anyone’s mind about that, there isn’t now. With the big money, comes big expectations.

The good news is that not much of this will likely be particularly damaging for Color in the long term (and hey, with $41 million in the bank, long can be LONG) and the team is doing what they need to to recover.  However their experience should still serve as a cautionary tale for startups that won’t necessarily find their market and their investors so patient and/or forgiving.