Thinking about pre-seed funding? Getting your company off the ground is a challenging task, but far too many entrepreneurs want to run before they even crawl. It is easy to imagine a busy staff of great, motivated employees working for you, money rolling in, and interviews and quotes in Fast Company.
If you think about your business as an investment, you need to examine the risks at every step. It is very hard to challenge your assumptions – or even to know what you are assuming at each stage. There are several tools, such as the Business Model Canvas, Lean Startup, and other tools that help tease out the areas to explore.
Every entrepreneur has blind spots. These are things that they intentionally (or unconsciously) avoid. There are things that they know will be hard, but they avoid the hard stuff and focus on the easy parts.
One of my friends was starting a new consulting gig as a freelancer. Rather than working through the heavy lifting of figuring out her target audience, how was she going to contact them, what she was going to say to them, and all that – she spent a huge amount of money redecorating her home office, buying a new printer, and “nesting.” I knew, and she knew too, that she was avoiding the hard part.
Try to tackle the hard things first. If you cannot conquer the hardest part, none of the other pieces matter.
The Hardest Part: Getting Customers
For every business, the hardest part is acquiring and selling to customers. In fact, that this the only part of the business. Delivering the product or service is secondary – the product or service is the easy part. That is the part you already know.
When I talk to entrepreneurs who are seeking funding, they will talk on and on about their product, which they know very well. But then I ask: “How are you going to get your customers?” Sometimes, I feel like they are blowing me off and being dismissive. They might say “Oh, that will be the easy part,” which is when I know it is a problem.
Marketing Can Be Done Ahead of Time
Many entrepreneurs are afraid of selling their product “until everything is ready.” That fear causes them to delay and delay and delay. They are always tweaking one thing or another: making sure the website is perfect, building out their app with all the bells and whistles, and constantly tinkering around the edges.
The truth is that marketing can be done first, then build the product afterwards to address the need.
I recommend that entrepreneurs build *and test* their marketing plan immediately – before building their product or design their services.
Build a landing page and create the marketing collateral for the product first. Write blog posts addressing the customer pain points and suggesting the solution. If it makes sense for your business, run ads on Google/Facebook and see how those ads perform.
The landing page is where you test your problem/solution and refine the message – all without spending a dime on the product. Resist the urge to build the product yet. Find out what the customers want first.
Statistics from the landing page is your feedback mechanism. Ultimately, a potential customer will give you their email address and request to be notified when the product launches. But you might also look at the retention rate, use heat maps to judge interest in different parts of the landing page, and other techniques to ferret out what might be important to customers.
If you can generate enough volume on your landing page, use A/B testing to see which messages work and what offers perform better.
Why Do The Marketing First
Doing the marketing first removes a huge amount of risks.
First, it helps you iterate and improve the product offering without having to build anything. Second, it gives you a list of customers to contact as soon as you launch. Third, it is a pipeline where you can pour money into the front to spit out profits in the back.
The great thing about building the marketing engine is that you can learn much more about your customers than you can imagine. As customers sign up, look them up on LinkedIn, Facebook, Twitter, or wherever and learn about them. What are their demographics of age, gender, education, location? What are their job titles and industries? You will be surprised by what you learn, but the biggest factor is that it will help you to retarget people like them.
What About a Patent?
Many entrepreneurs have a fear that someone will “steal their invention” if they tell someone. So they run into the arms of their patent attorney – who is all too happy to take their money.
If you are telling someone your invention when you are doing marketing, you are doing it wrong.
Customer discovery and understanding the market is *never* the time to tell someone your idea and see if they like it. Entrepreneurs cannot resist the urge to get glowing feedback, and they are essentially asking their Mom if she liked their artwork.
Understand your customer’s problems and craft a solution. Then get a patent once you have data to support the investment.