I saw an interesting video by Garry Tan where he mentioned that startups spend as much as 40% of the funds they raise on Google & Facebook ads. That is a lot. In other words, 40% of all VC money is going to those 2 companies. This is obviously going to reduce in the coming months and so we could expect this to reflect in the earnings of these 2 companies.
During the upcoming recession caused by the COVID-19 pandemic, the advice that seems to be coming from everywhere is to have cash runway that lasts 18 months.
In order for this to work, many startups are going to reduce their spending or risk survival. One option that all startups have is to allocate more time and resources to retain more customers instead of acquisition, as the former is often cheaper.
The startups that are going to continue to invest in customer acquisition need to know that the lifetime value of customers would most certainly be lower than what they were accustomed to. Because of this, an immediate recalibration would be required for ROI metrics. Acquiring customers on a better a ROI than before should be the norm for the next few months.
These are difficult times for everyone including us but looking into pandemics of the past suggests that all this should be over soon.
Large platforms treat users from different countries differently. They do that to apparently keep their platform “safe”. To keep the platform safe, they look at the data they have on each country, the amount of spam/scam etc happening from each country or region and then develop rules to treat each user accordingly. In theory, this means it’s harder to use these platforms from Pakistan than it is from US even if all you’re trying to do is use the platform the right way.
One such restriction that I’ve always seen happen is completely losing access to account. For example in the past, I’ve lost access to my Facebook personal account and Facebook ad accounts. Google Adsense is also more likely to get disabled in Pakistan than in US. There’s always the option to appeal for both these platforms but appeal often results in nothing.
A friend of mine devised a strategy to deal with these appeals. His theory is that all account closures happen with no human intervention. The decisions are completely taken by the machines. He also believes, and I agree, that in most cases the appeal process also happens without any human intervention. So how can you convince a machine into accepting your appeal?
My friend uses emotional signals to deal with this. If you’re apologetic or regretful in your tone of appeal, your appeal is never going to get accepted. You’re guilty and you’re showing it in your tone. Instead, my friend is angry, distressed and disappointed when he’s appealing; and I’ve seen it first hand that the appeal is much more likely to work.