Building A Startup Backwards

I think the point is there is a romantic ideal of building product first, just make it cool, no ads, don't focus on revenue. If you need cash, raise a venture round.

But that actually puts a lot of strange stresses on a company, because the need to find a exit for a multiply of the money they raised.

In this case, the company figured out how to monetize and attract users, but not retain them (a lot of churn). Now they are trying to build a stickier, more engaging product.

It's funny how "backwards" in startup-land is "using basic business common sense" for every other business venture on the planet.

This isn't revolutionary advice here: get profitable, then grow. There's far less risk in doing it that way than the reverse. Even if you make mistakes while small if you are profitable or even on the bubble of profitability you can overcome them. Just about any mistake on timeline, acquiring investment funding, "monetization", or budget can easily sink a "grow then make money" style startup. Given that novel software development is already a rather risky endeavor that translates into quite a lot of risk.

It's an interesting idea. It seems to me that so much of the revenue side depends on scale. How can you monetize something if you aren't sure how its going to be used etc? The user experience often drives how a site can be monetized... you know?