The Toll Booth
A new way to think about pipeline
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Datadog spent every possible penny sending sales reps to conferences before investing in a second growth channel. Conferences alone brought them from 0 to 100 (!) sales reps.
We often have the intuition that we need to do a little bit of everything to generate pipeline. I know I did. But that was because I didn’t have a way to think about how pipeline actually works. Here’s a new way.
Part 1: Demand
Most of the time, it would be weird if someone bought your product, given what’s on their to-do list.
Some of the time, it would be weird if that person didn’t buy your product, given what’s on their to-do list.
When they’re “weird not to buy”, they have demand.
And: Something causes them to go from “weird to buy” to “weird NOT to buy”. This thing isn’t random; nobody just wakes up and says, “You know what? It’s Wednesday, July 9th, in the Year of Our Lord 2025, and I’m thinking it is ‘Find an ERP Day!’”
These causes replicate across our customers. Maybe they hit a new milestone in their business, they get a bad report card, they get rejected from YC, they hit a plateau in their shoulder press.
Whatever it is, there’s a thing that causes demand, that forces them to prioritize something on their to-do list. And when we know what that thing is, we can design around it. Enter the toll booth.
Part 2: The Toll Booth
Imagine you meet a slightly defective genie, who gives you the opportunity to place a toll booth anywhere on Earth. Where are you going to place it? Are you going to place it in Siberia? Of course not! You’re going to place it at a choke point where a sh*tton of traffic HAS to pass through.
It’s a similar exercise for pipeline: When we try to figure out what our approach to pipeline should be, it’s like placing a toll booth - and we should place our toll booth wherever the thing that causes demand is.
Said differently, the “toll booth” approach to pipeline is the one that means that when any given buyer has relevant demand, it would be weird if they DIDN’T meet with us.
Using my product-market fit model (below), we’re focused on the demand side of the case study: In what situation are they forced to prioritize this project on their to-do list… and, given that, how do we design the pipeline step of our case study factory around that situation?
This is the exact opposite of “doing everything” - it is going all-in on the “choke point”, and ignoring everything else.
Weird implications of the toll booth
Here is a fun example of a toll booth. I can’t track down the source, so it might be fake, but whatever - it makes the concept visceral.
There was a consultant who served Fortune 500 CEOs who were going through some sort of public crises. These crises were covered in the news. So whenever the consultant saw an article about a Fortune 500 CEO going through a crisis, he sent a personalized samurai sword to the CEO along with a note that said something like, “I will go into battle with you.”
We can look at this approach at the surface level and say, “lol, samurai sword, nice.”
Then we need to double-click into it, because the mechanics and implications are fascinating:
This consultant knows with absolute certainty who has demand right now
Because of this, he is able to do something that is so weird/expensive/perfect it GUARANTEES his potential customers meet with him (and almost certainly improves his conversion rate when they do meet with him).
Let’s compare this approach versus more traditional approaches:
Typical non-toll booth approach: This consultant could have simply sent white papers and cold-called all Fortune 500 CEOs.
Partial toll booth approach: This consultant could have sent white papers and cold-called only the Fortune 500 CEOs who were in a crisis in the newspapers.
Full toll booth approach: Samurai sword to CEOs in crisis.
The implications come out when we put some hypothetical numbers behind these 3 paths:
When (1) we know who has demand, and (2) know what we can do to basically guarantee they talk with us when they have demand, we have something like 500-600x more budget to play with per lead.
As a result, we can send a personalized samurai sword instead of a generic whitepaper. Plus, we can design a better-converting sales process - no need for complicated intake forms or pre-demo proctology exams (more commonly described as “BDR qualification calls”).
Seeing demand and understanding the toll booth strategy, in other words, enables us to do things that are crazy to traditional thinkers (which makes our toll booth strategy even more effective, and harder to copy). But yeah, doing this takes real guts. It is a consolidated bet in a world that likes to hedge.
Back to Datadog, which I mentioned at the beginning of this post: Their conference approach was an example of a toll booth strategy, because their potential customers, when they had demand, would go to a conference. BUT: Don’t conflate the toll booth strategy with a single-channel strategy. It’s saying “we’re going to dominate this demand situation” first, and THEN (maybe) “we’re going to dominate this specific channel.”
So, dear friend: What’s your toll booth?
Some examples of toll booths below. I am keeping my eyes open for more examples - if you know any good ones, send them across!
A startup found that customers bought their product immediately after using a certain kind of consultant - so they went all-in on partnering with that kind of consultant.
A startup primarily sells to new YC startups. They make it weird if YC startups don’t hear of them by being omnipresent around the YC office (flyers, billboards, etc.)
I seem to have done this (unintentionally) by coining the term “the pain cave” and sharing the Harvard workshop deck: I now own a set of ideas that serve as a kind of toll booth for this awful part of the startup journey.
Bob Moesta found for his construction company that his potential customers started considering downsizing their homes after going to a friend’s funeral; they started advertising in the obituary section of the newspaper.
Zapier’s SEO approach - every time you search “Connect X software with Y software”, they are at the top - is a great example too.
Don’t waste your life in the pain cave. Get my PMF feedback and see if now’s a good time to join a PMF sprint - grab 15 w/ me here!
Rob this is probably my favorite article on PMF I've ever read. Love it!