As we discussed in Chapter 2, one of the worst outcomes your startup can realize is finding out people aren’t willing to buy your product after you’ve spent significant time and money building it. One very good way to avoid this outcome is to market and sell your product before you even have anything built.
It may sound counterintuitive or even dishonest to try and sell something that doesn’t exist, but it can be done without lying or failing to provide value. Consider Eric Warnke and Mark Fossen; the pair noticed from Dropbox user forums that people were looking for a File Transfer Protocol (FTP) interface to work with the service. Instead of building anything out, they created a website for Backup Box that simply detailed several different plans and price points. When a user clicked on a plan, they were told the service was not ready yet and asked for an email address – all the while they collected data on both customers and what services they desired, at what price. [1]
Backup Box is a bit of an extreme example, but a good one. It’s also fairly simple to replicate this tactic using a simple landing page and some targeted Google Ads. (We discussed this strategy in Chapter 2 and list our favorite landing page tools in our Startup Tools & Resources.
Many other startups got their start by manually doing work that a fully built product would automate. Y Combinator-backed startup ZeroCater operated from a spreadsheet completely maintained by founder Arram Sabeti until billing grew to over 20 hours per week and tens of thousands of dollars in paying customers. [2]
ZeroCater is a service to eliminate the headache companies face in coordinating meals for their employees. Sabeti pitched ZeroCater to everyone he spoke with, gathering names and contact information on the spot to follow up with later. Eventually, Sabeti’s spreadsheet grew to over 500 columns and he began looking for a technical co-founder to help build an automated solution.
Sabeti’s story is a great example for entrepreneurs. The thought of being a solo, non-technical founder of a technology startup sounds impossible or, at the least, foolish. However, Sabeti believed in his idea and vetted it through selling it to customers before a line of code was written. In turn, this made it much easier to convince a technical co-founder to come on board.
Selling Your Vision
For a startup founder, there are generally few hard assets to show off or pitch besides your vision for the future. If you want to sell someone on your vision, it has to be a grand vision of future potential and possibilities – something employees and investors can get behind. Working for or investing in someone who has poured his life savings into an idea simply in the hopes of it someday paying off is not compelling – your vision of what the company could be is.
The only way you can convince someone to leave a paying job to work for a startup that may not even be able to provide a paycheck is a vision that inspires him or her. Something he or she can get behind. Investors and first employees alike get excited at the prospect of being on the ground floor of “the next big thing” and making a giant return on their investment – whether it be in terms of dollars or hours.
To convince these people that your company is that next big thing, you need to focus on what your company could be – not necessarily what it is today. Startups move and evolve so quickly that there is no time or reason to dwell on what your company is today – focus on your vision for the future.
It is important to frame your sales pitch as focusing on the person you are speaking to. You won’t excite an investor talking about how lucrative the company can be for you – talk about how lucrative it can be for them! Tell your employees the benefits to their well-being and happiness in working for you.
Consider a few of Dale Carnegie’s techniques for handling people and winning them to your way of thinking in his bestseller, How to Win Friends and Influence People:
- Arouse in the other person an eager want
- Remember that a person’s name is, to that person, the sweetest and most important sound in any language.
- Talk in terms of the other person’s interest.
- Make the other person feel important – and do it sincerely.
- Appeal to the nobler motives.
- Dramatize your ideas. [4]
These principles have remained relevant and effective since the book’s printing in 1936. It is not by accident!
The Art of Selling
It is important to remember at all times that no one is as familiar with your product as you are. Often, entrepreneurs fail to remember this because they spend all day every day thinking about their product, and to them, it is easy to grasp.
In reality, showing your product to someone else for the first time is like selling fire to a caveman. Though they can see that it is new and impressive, they have no idea what it is they are looking at. It is up to you to break it down into a way that is both a.) easy to understand and b.) exciting.
The first step in pitching your idea is painting a backdrop for your solution. Outline the problem your client or customer is probably facing to bring that pain to the foreground and ready for relief. Telling a story is an effective way of keeping the audience’s attention, and much easier to relate to than a list of facts and figures.
Once the table is set, begin explaining your solution. Regardless of how intricate and complicated your solution is, explain it in simple terms to help the user understand. The more colorful, meaningful, and simple you make the explanation, the easier time your audience will have in understanding. Keep it brief and relevant – outlining every distinct feature of your product will start to burn through the user’s attention span and excitement.
Suster also says the idea of pitching someone is to gain interest and leave a positive impression to follow up on later. Keep your pitch short, relevant, and exciting. Once your subject is excited, you’d won. Give him or her a chance to ruminate on it and follow up with more information later. Sometimes this means you don’t get past the first slide in your pitch deck – and that’s not a bad thing!
At the end of the day, remember you are pushing for a sale or commitment. A bunch of people who are interested in your product but have no interest or intent to buy are not of much interest to you.
In the next chapter, we talk about your startup business plan – the important assets you should have ready and available when you are pitching your business.
References
[1] http://www.inc.com/minda-zetlin/how-to-build-product-customers-will-buy.html
[2] http://www.entrepreneur.com/article/229084
[3] http://techcrunch.com/2013/04/06/how-i-started-zerocater/
[4] http://www.amazon.com/How-Win-Friends-Influence-People/dp/0671027034
[5] http://www.bothsidesofthetable.com/2009/06/05/the-dreaded-elevator-cocktail-party-pitch/
Source Twitter Handles
Arram Sabeti – https://twitter.com/arram (@arrem)
Mark Suster – https://twitter.com/msuster (@msuster)