While I agree with this article, I am surprised- invariably, by the lack of a single fundamental question that kills most companies:
What problem do you solve, or solution that you offer, that people/companies are willing to pay for?
To me, this is the very first thing, long before others.
LOTS of startups have a vision. And they don’t offer something that people want to buy. Just as an example.
Because baby, if there’s no need for what you have to offer, whether it’s a widget or a water bottle, it’s not going to sell. Even if you come up with a brand new product, you have to be able to compellingly argue that there is an as-yet powerful unperceived need for it. You want Angel Money? Can’t describe the problem you solve or the solution you offer? You won’t get funding. This, to me, is so powerful a step before we ever do anything else. I have seen umpteen companies die because they cannot explain, describe, justify or clarify their value proposition. This means pick an industry, for example, understand what keeps your target buyer up at night, and solve that person’s problem. THAT will get you the best start possible. Without that clarity, it’s hard to convince others that you deserve to be heard, be funded, etc.
With respect, we no longer have a thirty-second window to get across our value prop. It’s about 7–8 seconds. Check your Microsoft research (2015). Less than a goldfish thought. The 30-second bit is about ten or more years out of date and pre-digitation of our society. Even back then, every CEO I knew told me that s/he had less than 7 seconds to tell another CEO their value proposition. That’s driven by bullet-point thinking and today’s very short attention span. Clarity is power- and you’re pushing for it through your whole article here- but this one, I teach this all the time. If you can’t get out your value in less than ten seconds they are already thinking about the next thing. This is HARD. It’s also survival.
Here’s an example:
We solve the problem of electrical fires in car doors.
Imagine you just said that to a key exec at GM right after they had to recall some several hundred thousand SUVs for that very reason (this is an actual example). I guarantee you that exec is going to whip your card out of your hand and want to have a serious discussion about how you do what you do. THAT is clarity. THAT is focus. THAT is power, positioning, and profits. Just saying. Doesn’t guarantee you the contract, but it sure makes you heard above the noise of all those folks who “do it all, just ask me.” They hear that all the time. So when you show up an pinpoint a place where they are bleeding bucks, or where their employee performance is a disaster, or their customer satisfaction is poor, and you have a proven solution? That’s called a good business strategy. More folks lose their startups because they can’t absolutely clarify the value they offer than a great many other reasons, including cash flow.
Great article. Thank you.