“Who is your customer? Can you create a profile of your ideal customer? How do you find them or do they find you? Which set of customers are your most profitable? With which customers do you think a long term relationship can be established? How many of your customers do you meet regularly? How do you charge your customers? Who do you compete against? Why do you think you’re better? How do you think you will knock the socks of your competitors? What other products and services are you willing to give up to focus on the most profitable ones? How do you sell? What is the cost of acquiring a customer? How long does it take from the first customer contact to receiving an order and then to receive payment? What the specific value proposition to your customers – why should they buy from you and continue to do so? What exactly do you do? What made you choose this offering? What is your personal experience with the pain suffered by customers”The above is a sample set of the questions asked by a panel at a recent selection of the top entrepreneurial companies. While only a handful were able to respond meaningfully, convincingly and forcefully, the vast majority hadn’t either thought of these questions or weren’t able to articulate their thoughts or were very obviously uncomfortable presenting to a panel.
“Have you contacted the CEO?” I asked the entrepreneur who I’d introduced to a CEO of a company. “No, not yet” replied the entrepreneur. “Why not?” I asked quite flabbergasted. “It has been only 36hours since you did the introduction and I thought I’d wait for some time before writing to him”. Here was a sales opportunity and the founder of a startup was worrying about waiting! In another case, the founders had to pushed very hard to reach out to potential customers and partners by way of attending industry conferences, becoming members of e-groups, connecting with other players in the eco-system, meeting members of the press and the like.
What is it that prevents or inhibits the founders of a startup from aggressively peddling their company’s value? What is it that prevents or inhibits them from forming partnerships, forging alliances and pursuing sales leads? As India becomes an increasingly market oriented open economy, the “build it and they will come” mindset has to give way to “build something the market desires and make sure that the market knows it”. The production oriented approach has to give way to a market oriented one. As a culture, we’re naturally inhibited about talking about ourselves. It isn’t right. It is a sign of immodesty to tom-tom one’s own achievements and offerings. But as the saying goes, if you don’t talk about yourself, who else will? The rest of the market will then inconveniently and inappropriately perhaps, position you because you refuse to position yourself. As Jack Welch, the legendary Chairman of GE wrote - “Control your destiny or someone else will!”
Communication and presenting skills are crucial as well. In the limited time available, one has to learn to make a compelling and persuasive pitch. There are no short-cuts to this effort but a lot of practice, taking of feedback and learning are required. No different from any other activity. Perception is reality so it is crucial to make that pitch work. Clarity of thought, focused approach to customers and markets, understanding of what the value to customers are of no use if the person listening doesn’t hear it.
Very many years ago, a very senior well respected VC fromSilicon Valleytold me this: All I want to know is:
- Who are you?
- What’s the problem you’re solving?
- Why will you knock the socks of competition?
- How will you make money?
It is not unusual to find the names of the founders and management team missing from presentations or even web-sites of Indian startups. But remember, people don’t do business with spreadsheets and presentations. They do business with people. So it is always a good idea to talk about the team and its background and why it is doing what it is doing!
So why this strange modesty in discussing oneself and one’s vision? Churchill once famously described someone as “….is a modest man with much to be modest about!” but a confident entrepreneur surely cannot be a person with much to be modest about? Remember, there’s a thin line between arrogance and confidence. Arrogance precludes learning, includes bombast and demonstrates a lack of humility. Confidence ensures humility, learning and certain relentless and adaptable focus.
So please remember, that selling and communication skills are critical for the founding team of a startup. The first set of sales have to be done by the founders. A sharp understanding of their customers, the value being created and the ability articulate this value are skills that are honed through practice. These skills cannot and should not be wished away as being distasteful. Remember company building involves a disproportionate share of these two invaluable skills.