Don't run ads yet: Five things early-stage founders must do first
Before spending money on ads, early-stage founders need to nail these 5 fundamentals. Learn what to prioritise first to maximise your ad performance and ROI.
You've built your product. Your team is excited. And now you're ready to pour money into Facebook Ads, Google Ads, or LinkedIn campaigns to drive growth.
Not so fast.
Creadit: Unsplash
Every week, I see early-stage founders burning thousands of dollars on ads before they're ready. The result? The result is poor conversion rates, wasted budget, and a mistaken belief that "ads don't work for us." The truth is simpler: ads amplify what you already have. If your foundation is weak, ads will only amplify that weakness, at scale and at a cost. Listen to the podcast or read our recommendations below.
Before you launch your first campaign, here are five critical things you must nail first.
Note: To reduce text-heavy overwhelm, click the tab below, one at a time, to read through the sequence of recommendations.
-
Running ads before you have product-market fit is like pouring water into a leaky bucket. You'll attract users, but they won't stick around.
Why This Matters
Paid acquisition is expensive. When you pay to bring users to a product they don't truly need or want, you're essentially funding a very expensive lesson in what not to build.
Early-stage founders often confuse interest with product-market fit. Someone signing up for your waitlist isn't validation. Is someone using your product on a weekly basis and recommending it to their friends? That's closer.
What to Do Instead
Before spending a dollar on ads:
Talk to at least 20-30 potential customers in your target market
Identify a specific, painful problem they're actively trying to solve
Build a minimum viable solution and get it into their hands
Track whether they use it repeatedly (weekly at minimum for most B2B products, daily for consumer products)
Ask them: "How disappointed would you be if this product disappeared tomorrow?" (If fewer than 40% say "very disappointed", you're not there yet.)
The test: Can you acquire your first 100 users through manual, non-scalable methods? If you can't get people interested when you're personally reaching out, you won't get them interested through paid ads.
-
Even with a perfect ad, a poorly designed landing page can kill 70-90% of your conversions. I've audited hundreds of landing pages for early-stage startups, and the same mistakes appear repeatedly:
Vague value propositions ("The best solution for modern teams")
No clear call-to-action
Too much text, not enough visual hierarchy
Slow load times that cause visitors to bounce before the page even loads
What to Do Instead
Build a landing page that converts before you drive paid traffic to it. Your page should include:
Above the fold:
-A crystal-clear headline that communicates the value (not what you do, but the outcome customers get)
A subheadline that adds specificity
A prominent call-to-action button
A relevant image or video that shows the product in action
Below the fold:
Specific benefits (not features) with clear outcomes
Social proof: testimonials, logos, or usage statistics
A clear explanation of how it works (3-5 steps maximum)
Trust signals: security badges, certifications, or guarantees
Another call-to-action
The test: Before running ads, send the landing page to 20 people in your target market. After 30 seconds, ask them:
(1) What does this product do? (
2) Who is it for?
(3) What's the next step they should take?
If they can't answer these clearly, your page isn't ready.
Pro tip: Use tools like Hotjar or Microsoft Clarity to record real user sessions. Watch where people get confused or drop off.
-
You can't optimise what you don't measure. Yet countless founders start running ads without proper tracking in place.
Why This Matters
Without analytics, you're left in the dark. You won't know:
Which channels drive quality leads
Where users drop off in your funnel
What your true cost-per-acquisition is
Which ad creative or messaging resonates
This leads to wasted budgets on underperforming campaigns while you kill campaigns that were actually working.
What to Do Instead
Before spending on ads, implement this tracking stack:
Essential tools:
Google Analytics 4 (or similar analytics platform): Track user behavior, page views, and basic conversions
Conversion tracking pixels: Install Meta Pixel (Facebook/Instagram), Google Ads tag, LinkedIn Insight Tag, whichever platforms you'll use
Event tracking: Set up specific events for key actions (sign-up, trial start, purchase, key feature usage)
UTM parameters: Create a consistent naming convention for campaign tracking
Define your key metrics:Top-of-funnel: Click-through rate (CTR), cost-per-click (CPC)
Mid-funnel: Landing page conversion rate, cost-per-lead
Bottom-funnel: Lead-to-customer rate, customer acquisition cost (CAC), return on ad spend (ROAS)
The test: Run a small test campaign ($100-200) to a few friends or your email list. Can you track every step of their journey from click to conversion? If not, fix your tracking before scaling.
-
Most people won't buy on their first visit. The difference between thriving startups and failed ones often comes down to what happens after that initial click.
Why This Matters
The average conversion rate for a first-time visitor is 2-3%. That means 97-98% of the traffic you pay for will leave without converting. If you don't have an email capture system, you risk losing that traffic and your ad budget forever.
Smart founders build a system to capture emails and nurture those leads until they're ready to buy. This is especially critical for higher-priced products or complex B2B solutions with longer sales cycles.
What to Do Instead
Build your email collection and nurture system before running paid ads:
Email capture:
Offer a valuable lead magnet (checklist, template, guide, free tool, or exclusive content)
Use exit-intent popups to capture people before they leave
Place email signup forms strategically throughout your landing page
A/B test your copy and offers to maximize signup rate
Nurture sequence:
Welcome email (immediate): Set expectations and deliver promised lead magnet
Value email (day 2): Share helpful content related to their problem
Social proof email (day 4): Case studies or testimonials
Product education email (day 7): How your product solves their specific pain point
Conversion email (day 10): Direct ask with time-sensitive offer or bonus
The test: Build your email sequence and test it with your existing contacts or early users. Track open rates (aiming for 30%+ on average), click rates (aiming for 3–5%+), and conversion rates. Optimise until these metrics are solid.
-
This is the most overlooked step, and it's the one that kills startups.
Why This Matters
If you don't know your unit economics, you can't know if your ads are profitable. I've seen founders celebrate "growing" their user base while unknowingly losing money on every customer.
The math is simple: if it costs you $150 to acquire a customer, but that customer only generates $100 in lifetime value, you're not building a business—you're burning money.
What to Do InsteadCalculate these critical metrics before scaling your ad spend:
Customer Lifetime Value (LTV):
For subscription products: (Average revenue per user per month) × (Average retention in months)
For e-commerce: (Average order value) × (Average number of purchases per customer)
Factor in gross margins to get a true picture
Target Customer Acquisition Cost (CAC):
Rule of thumb: LTV should be at least 3x your CAC
For SaaS: Aim to recover CAC within 12 months
Your CAC includes: ad spend + design/creative costs + percentage of marketing team salaries + tools/software
Budget allocation:
Start small: $10-50/day per platform to test
Allocate 70% of budget to proven channels and 30% to testing new ones
Set a maximum allowable CAC based on your LTV
Build in buffer for learning period (expect first month to be less efficient)
The test: Using your current customer data (even if it's just 10-20 customers), calculate your actual LTV and CAC. Should you not have customers yet, please consider modelling conservative projections. What's the maximum you can afford to pay to acquire a customer while still being profitable? Use this as your north star.
Creadit: Unsplash
When you may be ready to run ads
Once you've completed these five steps, you're in a much stronger position to launch paid campaigns. You'll have:
✓ A product people genuinely want and use
✓ A landing page that converts visitors into leads or customers
✓ Tracking systems that show you what's working
✓ An email system that captures and nurtures leads over time
✓ Unit economics that make paid acquisition viable
Now you can start testing ads strategically. Begin with small budgets, test multiple creative variations, and scale what works while cutting what doesn't.
The bottom line
Paid advertising isn't a shortcut to product-market fit. It's an accelerator for startups that have already figured out the fundamentals.
The founders who succeed with paid ads aren't the ones who run ads first and ask questions later. They're the ones who build a solid foundation, validate their approach, and then use ads to scale what's already working.
Skip the five steps above, and you'll burn through your budget learning expensive lessons. Nail them first, and ads become a predictable, scalable growth channel. Your runway is precious. Use it wisely.
Key Takeaways
Validate first, advertise second: Ensure you have product-market fit through manual outreach before scaling with ads
Optimise your landing page: A high-converting landing page can 3-5x your ad performance
Track everything: Install proper analytics before spending a dollar on ads
Build your email engine: 97% of visitors won't convert immediately, capture their emails and nurture them
Know your numbers: Calculate LTV and CAC to ensure your unit economics support paid acquisition
Ready to Launch Your Ad Campaigns?
Now that you understand what needs to happen before running ads, take action:
1. Audit where you are on each of these five areas
2. Identify your biggest gap
3. Focus on closing that gap before moving to the next
4. Only launch paid campaigns once all five foundations are solid
Remember: slow and methodical beats fast and careless every single time in early-stage growth.