A shocking result of the recent Startup Genome report was the finding that startup success is not all about the product!
Shock! Horror! Then why are the business angel and entrepreneur pitch events all about the product?
The number one concern of all startups – in all phases (from discovery through to massive growth) is customer acquisition.
Its not product.
So, next time we see a proposal talk about the product or the invention, stop the entrepreneur and ask
“how will you attract customers”
“how will you attract more customers”
“why would a customer pay your price/ buy your product instead of this or that product”
… and keep asking this question until you either get a great answer or resolve to move onto the next deal.
This also suggests that the hours and hours of entrepreneur presentation are wasted unless they talk about customer acquisition and how they will do it and why they are qualified to achieve their goals.
Of course, these last two questions – how and why – will quickly lead you to ask questions about their management team – and that’s where the discussion should focus.
As William Draper III said “you have to make sure that you have the right entrepreneur team. Nothing is more important. In fact, nothing is even a close second.”
Which is another way of saying that customer acquisition depends on the future performance of your team.