🤫 20 counter-intuitive lessons from 500+ consumer founders (part 1)

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Five years ago, I started Consumer Startups with a simple mission: figure out what actually works when building a consumer startup.

I've now interviewed 500+ founders, who've built everything from 9-figure prayer apps to smart toothbrushes. Along the way, I've gained some insights that shattered my assumptions about how consumer startups work. Many of this stuff goes against what you’d normally read in startup Twitter threads.

When it comes to startups, there’s never a perfect answer. But I’ve found that certain mental models and frameworks can really help. I wanted to share a few that have stuck with me. Hopefully, they’ll spark some ideas for your own startup journey.

Some industries aren't dead. They are just waiting for a modern reboot.

Fora brought travel agents back to life in the digital age, hitting $1B in sales by giving individual travel entrepreneurs better tools and tech.

Look for traditional industries where technology or shifting consumer behavior has quietly reopened the door.

Everyone avoids markets where others have failed, but smart founders see opportunity.

There was already a graveyard of failed U-shaped toothbrushes when Feno entered the market. But the Feno team built something fundamentally better. Now, they are doing mid-8 figure in annualized revenue run rate while growing 40% MoM.

The failures weren’t a red flag. They were proof of demand — just with bad execution.

If you can solve the core problem that killed others, you can build a massive business.

Look for assets, capabilities, or markets that others are overlooking or undervaluing.

Poplin (fka Sudshare), an Uber for laundry app, grew to hundreds of thousands of users by letting people earn money doing laundry for their neighbors.

Propel targeted low-income families on SNAP benefits, a group ignored by most tech companies, and acquired 5 million users.

Undervalued asset = overlooked opportunity.

Unfair domain insight is just as important as technical skills.

Hallow, a 9-figure ARR prayer app, wasn’t built by Silicon Valley tech bros. It was founded by a group of friends who deeply understood faith communities and their needs. That insight mattered more than code.

At the end of the day, tech can be hired or learned. Deep, unfair domain knowledge is often harder to gain. Don’t get discouraged if you don’t know how to code! This is especially true in the age of AI.

Everyone says "quit your job and go all-in." This might not be the only way.

Feno's founder, Dr. Kenny Brown, still performs oral surgery 3 mornings per week while running his startup. Staying in the clinic keeps him connected to real patient problems and provides credibility to his business.

The strongest competitive advantages often come from a set of unique resources and insights that only you possess.

Allermi, a personalized allergy care startup, was built by an art history graduate with zero tech experience. However, the founder’s secret weapon is a 30-year-old formula her Stanford allergist father had developed. She built an 8-figure ARR business by commercializing and scaling that formula with technology. 

Btw.. It also helped that she and her family were able to invest ~$1M personal capital into the business to bring this product to market.

Regulation is a big barrier for many startups, but it can also serve as a competitive advantage.

Dub, a copy trading app, spent 3 years working with regulators to become a fully licensed broker-dealer, creating a massive competitive advantage that most competitors couldn't match. 

Even though they were not the first to market, this brokerage license gave them a distinct advantage over their competitors, catapulting them to 1M downloads in just 10 months after launch.

In regulated industries, early investment in compliance allows you to move faster later on. 

Focus on validating your biggest risks/hypotheses first when you are just getting started. Building a scalable infrastructure in the beginning is often unnecessary.

Neighbor, a parking and storage marketplace, used WordPress, Google Forms, and Venmo to validate their idea before building real infrastructure. The founder personally coordinated between renters and customers.

Bounce validated their luggage storage concept with a simple landing page and Google Ads, personally fulfilling the first 20 orders on Citi Bikes.

I have heard 50+ stories just like these. Think about what's the most important hypothesis you want to validate, then find the scrappiest way to test it.

Forget the "total addressable market" slide. Find the people who are obsessed.

Sekai targeted hardcore anime fan-fiction communities, not casual anime fans. These users were already living in fictional worlds and had the strongest unmet desire. Sekai grew to 1M users in just a year by focusing on this one passionate user segment. 

Hard pivots can lead to massive success.

Hopper worked on the "wrong" product for over half a decade before pivoting to become a $5B travel company. Don't be afraid of major pivots if the market is telling you something different.

Moving backwards can set you up to leap forward. Avoid sunk cost bias.

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That’s it for this week! Next Tuesday, I’ll dive into 10 more counterintuitive lessons I’ve learned about growth and monetization.

See you then,
Leo

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