What's Your Biggest Problem? - Acquiring Customers
Having been involved with start-ups that have failed and been successful, our Product Managers have seen what works and what doesn't. Without a doubt, the biggest challenge which makes or breaks a new organization has always been the ability to acquire customers. Entrepreneurs should spend as much or more time contemplating their customer acquisition plan as product development. The mantra for startups is "CASH IS KING". If you can acquire key customers early in the startup development cycle, you can minimize your cash burn til when your new company is making profits and can sustain itself without a continual infusion of new investment. Even after being profitable, a new infusion of investment may be required to get to the next phase of growth, but the valuation of the company will be significantly influenced by the amount and kind of customers you have acquired to date.
Test, Test and More Test
You should have defined your target market and your unique value proposition near the beginning stages of your development cycle. It is important you test your ideas and theories with your target customers and ensure your ideas and theories are correct.
We mentioned in another article, "5 tips for a Successful Off-Shore Development", that prototyping is essential before investing more money and time into the actual coding of your software. Use these prototypes to test with your target audience and see if their experience is magical or a dud.
A Story of NOT TESTING
If you are unfamiliar with the software development process then it is highly recommended you enroll in an educational class on best practices for software development. One such class is Tech Speak for Entreprenuers, created by a former CTO, Nelly Yusupova. She has developed an on-line video educational series based on 10 steps to a successful software product development. Her website is https://www.techspeakforentrepreneurs.com . Here's her story of NOT TESTING.
It was 2008…I was the CTO of Webgrrls International, a professional networking organization of women in technology. Over the years, we built a suite of tools that served our 30,000 members, globally, who were very tech-savvy, professional women and the pressure on me, to execute flawlessly, was tremendous.
My team and I came up with a set of perfect new features that were going to CHANGE EVERYTHING for our members. We were very excited about the possibilities and the more we thought about these possibilities, the more incredible our idea became (to us), and the more excited we got! So, we put a lot of resources behind building these AMAZING features to enhance our offering. We spent the next 9 months building …and we finally launched!!! We sent out our announcements, we were executing our marketing strategy, connecting with all of our members…
AND…WE GOT NOTHING or, next to nothing.
So, we’ve just committed 9 months of time, money, and resources… And after getting the necessary feedback, we discovered that the solution, we spent the last 9 months on, was NOT A PROBLEM WORTH SOLVING!
No Code Software Development
Another way to test your market without a lot of costs is using a no-code development platform. One popular platform, bubble.io , provides a free option. Their mantra is "Building tech is slow and expensive. Bubble is the most powerful no-code platform for creating digital products. Build better and faster." You can even go to production with this code at a cost as low as $25 per month if market testing proves your idea to be a good one.
The downside of using the Bubble platform is that you cannot take the underlying software code of the application with you. If you find the operational expenses too high or capabilities too limited with their no-code platform, you have to start all over to develop fresh code. However, this is still okay as it minimizes market risk to your success, the biggest obstacle to company success. Plus, your development team can code efficiently and faster because their target specification is more exact.
Low or no Cost Resources
There are a ton of low or no-cost resources which you can use to fine-tune your start-up, as you begin to solidify your ideas. Here are some which can be useful.
SCORE is a government-sponsored SBA agency. SCORE's mission is to foster vibrant small business communities through mentoring and education. Their vision is to give every person the support they need to thrive as a small business owner. They have offices in every major city. Their free resources include mentors and business plan templates, and advice on how to get an SBA loan. They also provide no-cost/low-cost educational seminars such as SEO, Internet Marketing, a Startup Roadmap, Managing Cash Flow, and Developing a Business Plan.
Search for a local high-tech entrepreneur groups. You might find these through Meet-Ups. In San Diego, the local community support for high-tech entrepreneurs is sponsored by UCSD, through their Connect program. This program offers workshops, seminars, and one-on-one mentoring programs. There is also similar access to free entrepreneurial resources in San Diego through startupsd.org.
Start Up Consultants
To keep costs low, you'll want to find consultant(s) to help you along before hiring employees. Finding the right consultants to help you bring your business to fruition can be a challenging endeavor. While a seasoned consultant may be more expensive than an employee, the value of experience and avoiding pitfalls in the long journey can create a path of success that otherwise would not have occurred or save you several thousand or millions of dollars of expenses or c
One site, anglels.io, is especially focused on start-ups. You will find consultants or even employees tailored specifically for startups there.
You can also find resources to assist you at websites focused on freelance consultants. Such sites include Upwork and Fiverr, which provide a variety of resources that either bid on your project or can be paid an hourly wage.