Stumped when asked “Is your offering a ‘Pain-Killer’ or a Vitamin”?
A frequent question that is posed by VCs or angel investors to potential investees is, “Is your product or service a ‘Pain-Killer’ or a ‘Vitamin’?" And nothing can be as unsettling as that.
If the investee replies ‘Vitamin’ (which is not likely, given that every entrepreneur considers his product as path-breaking and earth-shaking), then they can say ‘good-bye’ to funding since no investor will be keen on it, and it may not get the required traction. So, the only option left to the entrepreneur is to call it a ‘Pain-killer,’ but he must necessarily defend that position on why he is saying so.
This article will make it easier for those who are nervous facing this question.
Before we go to the actual suggested response, it is important to clearly distinguish what these terms ‘pain-killer’ and ‘vitamin’ mean in a ‘clinical’ context.
Let’s say I had a severe headache an hour back. I was immediately looking for a tablet or a capsule that will give me instant relief, and at that point of time the paracetamol (I do not wish to be seen as promoting any brand) is a pain-killer. (By the way, I don’t subscribe to the term ‘pain-killer’ because if the pain is actually killed it cannot come back after some time. But that’s a matter for another article!!)
Now my pain is gone and I am happily cleaning my home (did I hear someone say that ‘happily cleaning’ is an oxymoron?). If someone were to offer the same drug, I will refuse it. Why? Because there is no pain now, I don’t need a pain-killer!! As simple as that!!
So what is that drug to me then and now? It was a pain-killer when I have a pain but it's just a tablet (not even a vitamin) when I am without pain. Perhaps, now that I am enjoying my cleaning act, I might even want to take a Vitamin C tablet to have a better protection against cold and the dust!! I’m sure you get the drift now.
So there is nothing per se a ‘pain-killer’ or a ‘vitamin’. It purely depends upon the context.
Having seen the ‘medical’ distinction, let us now apply it to a business scenario.
For an entrepreneur who is struggling to get his business off the ground for want of funds, a VC or an angel investor may really look like God’s messenger. But if the same venture is generating enough internal accruals to fund the existing business as well as future expansion, the same VC or angel might appear as a ‘Shylock’ out to grab the equity by hook or by crook! Has the entrepreneur or the investor changed? Not at all. The context has changed and that gives rise to a new perception. So is ‘money’ a ‘pain-killer’ or a ‘vitamin’? It can be ‘both’.
Let’s take another example. If your product is a CRM and your target audience is hospital, then you can make it a ‘pain-killer’ or a ‘vitamin’. How?
By emphasising on the problem of many hospitals in attracting patients, you can position your CRM as the solution that helps create delighted patients who will generate referrals in addition to coming for reviews or repeat visits. (I can’t think of one reason why patients would love to come back, but then why bother about such trivial details when talking about the big picture.)
Alternatively, you can use the same scenario where you can call your CRM a vitamin that will contribute to the overall wellness brand image of the hospital and thereby attract hordes of patients.
So if you are an entrepreneur, the question of whether your product or service is a pain-killer or a vitamin need not be so threatening. You can position it whatever you want by setting the context.
And it's high time that we stop being ‘reluctant’ or ‘shy’ in calling our offering a ‘vitamin’. Just ask this question of the potential investor, if his facial expression changes noticeably when you say ‘vitamin’: 'Do you want to live on pain-killers all through your life or would you prefer vitamins?' They will get it.
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