What excites you?

What intrigues you the most? Going after the same things everybody else is going after? Or going counter and look in places that most other people have abandoned?

I am all for the latter. While I recognize that there are indeed major trends out there and obvious opportunities, I personally find those that run counter more intellectually appealing. When I meet those I always ask myself: Is what they are trying to do just dumb? Or is it really super brilliant? It’s usually one or the other.

For me too much groupthink doesn’t do it for me. The argument for doing something because everybody else is doing is has always been weak and void to me. While there may be something there, the sheer fight over something with a lot of other piranhas eventually leading to a slide down to the lowest common denominator simply just isn’t that appealing. Add to that that the math seldom checks out for me; in a saturated market easy to penetrate, not everybody who claim whey will win will have the ability to win. Simply too many piranhas in the sea. Most will end up with a fairly decent haircut.

Going counter is another matter. Going where everybody else – or most – have already given up, while the problem at hand persists, intrigues me. I does something good to me to know that succeeding where others have decided not to even play takes something extraordinary, and that success rests on the ability to figure out what exactly that extraordinary component is.

Yes, I know the risk is bigger. It’s really do or die. The difference between making a bet on red on the roulette versus placing all your chips on 0. However, I love this approach for three reasons:

First, it’s deeply satisfying to get really challenged in figuring out something that’s super hard and not for everybody to dig into. It provides a sense of real accomplishment, when – if – you succeed in doing it.

Second, you can add the satisfaction of hopefully having been able to solve a real problem to people that others have given up on trying to solve. You get the sense that you’re affecting real change, creating impact and that people are substantially better off, because you decided to put in the work and effort that was beyond reasonable for many others.

And finally, the returns on your success are likely outsized – at least if the problem you have chosen to tackle is valuable enough to enough people. Because you were the one going counter, most of the pie will be yours. At least in the beginning.

Again, I fully realize a great opportunity when I see it, and I am not hellbent on making things as complex as they can be. Sometimes easy truly is the better way forward. But in terms of really what makes me tick, it’s the tougher challenge – the one where you really feel alive and in the zone.

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Your customer is the bottom line

There are many approaches towards building a healthy startup business that will take off, grow end endure during both good and more challenging times. But honestly I cannot think of a better one than to treat your customer as the bottom line.

The math behind it is simple: Every time you delight a customer by solving her problem and giving her a delightful experience more than worth the money, she’s paying, she will stick around. And not only that. She will also be advocating your product and brand to those she knows or comes in contact with who are experiencing the same sort of challenges as the ones, you helped her solve in the first place.

When I think about it there is actually no real viable long term alternative to this approach. Of course there are numerous other ways you can optimize for growth, gain initial traction and stretch your available funds to last a bit longer, but over the longer term? Don’t think so.

The problem with a lot of more tactical approaches towards building your bottom line is that they are inherently short term. They may put a band on the sore or enable you to play through the pain barrier, but they don’t fundamentally cure or fix anything.

You will always be in the need to come up with new approaches, new tricks, new creative ways of doing things, and chances are that the positive effects of these things will vane over time. And then you’ll really just be playing catch. All. The. Time.

So focus on the customer and delighting her. Make that the primary outcome of everything you do in your startup. If you’re looking at doing something that cannot be directly related towards a positive contribution to this outcome, think hard about whether you need to do it. Be tough on yourself. And eliminate all necessary distractions in order to focus on – you guessed it – delighting the customer.

If you’re looking for proof that the approach works, look no further than to Amazon and its founder Jeff Bezos. He is notorious for always wanting to put the customer and customer satisfaction first. Often to the extreme and – sometimes, I would argue – to the detriment of his own team. That’s more than dedication. That’s obsession. But the results speak for themselves.

Of course your not Jeff Bezos, and your startup isn’t Amazon. But there are still things that you can do in your everyday operation to put the delighted customer left, front and center of everything you do.

You can start by really taking customer success and support seriously. Stop looking at it as a support feature, you need to have but don’t really invest in. Invest heavily in it. Put some of your best people there. Give them the mandate to truly listen to customers and feedback, and allow them time and space to turn that feedback into thoughtful suggestions for things your startup can do on the product side in order to further delight customers.

That’s not to say that you should just go with any whim and whichever customer yells the highest about something they may think they want or need or something they want you to remove. Far from it. But it is about keeping an ear to the ground and maintain a balanced approach to listening in that will help synthesize the most crucial nuggets back into both your product and everything surrounding it.

Your product will most likely be all the better for it. It will delight customers more and help attract new ones. And it will fuel the success of your business and your bottomline in ways that nothing else can.

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Customer check-in

One thing I find very fascinating is that for a lot of startups there seems to be an almost inverse relationship between the energy put into acquiring and onboarding customers versus the energy put into keeping them as happy customers for the long term.

Of course most startups do customer satisfaction surveys, NPS scores etc, but how often do you actually reach out to some of your customers to engage in a real conversation about how it’s going, how they use your product and what challenges they are experiencing?

Thought so.

The challenge tends to become more complex the more you’re driven by SaaS-metrics like MRR and ARR. Yes, it is vital that you understand these, but what difference will it make, if in essence you have very little understanding of what is going on behind the scenes, in the heads and minds of your customers?

One of many reasons that Amazon has become so extremely successful over the years is that they have always been extremely customer obsessed. They have always been looking towards understanding the customer, the journey and experience better and better in order to develop their many offerings.

And they have been remarkably successful to say the least.

You will most probably not be the next Amazon, but that doesn’t mean you shouldn’t steal a page our of their playbook and become totally customer obsessed.

Lesson one in that course is to start treating an existing customer and the relationship you have and want to expand with that one over time with the same amount of energy, you put into acquiring new customers.

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Who are you selling to?

Let me admit it straight from the bat: I have an overwhelming fondness for business models that addresses the users wallet directly.

Not in terms of forcing them to splash the cash but in terms of delivering products, services and experiences that solve meaningful problems and challenges to people, which they are both willing an able to pay for.

Having said that I of course also realize that there are product and services, it makes little or no sense to sell to others than enterprises or even public customers.

But there is another consideration I think is important to make, when you’re thinking about how to get your product or service to market:

Is your product or service one that grows bottom-up or one that will only get a decent chance, if it’s implemented top down?

Normally, we would probably think that products coming from below would have the greatest chance of being successful. I think this is true to the extend that the user experience is superior, and the product is solving a problem that is well recognized by all by at the very least being more efficient at it.

But what if the product or service requires a ‘leap of faith’ in order to be given a chance and get an opportunity to prove its real worth in delivering value to users?

Here, perhaps, it would often be better to go the entreprise route; find the internal champion of whatever problem or challenge your innovation is looking to address, making him/her see the light and how they could benefit from your product or service, and then let them buy it and roll out across the org.

The more new – and not in a consumer-friendly ‘shiny thing’ – kind of way a product is, the more I think you should bet on this enterprise approach. People can be unforgiving after one or two tries, and the corporate culture of moving slow but getting there in time might end up serving you well.

I guess, my overall point is this:

Look at your product or service and get crystal clear on the level of buy-in, it needs in order to be successful in a B2B context. The more buy-in it needs, the more patience you will need, and the more you should probably go the classic enterprise sales route.

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Map your GTM options

When I meet with young startups there is one thing that often springs to mind on the commercial side:

The tendency towards picking a business model on the shelf, often inspired by what others are doing, and settle on that as the model going forward without much further thought than that.

The reasoning seems to be that since others have chosen it (and some perhaps even succeeded with it) it will probably also be good enough for this startup. Plus you get the feeling that you have achieved something and can cross off a to do-item from your long list.

I think this approach is premature and may actually be damaging for the prospects of the startup in the long run.

Because what if the model doesn’t work? Do you just pick another then and repeat the same process? And what if the model, you have chosen, puts investors off because it’s too complex, hard and time consuming to succeed?

Forget about just picking a more or less random business model (I know, it’s not entirely random, but I am sure you get my point, ed.).

Map your go-to-market options out instead, as they relate very closely to a viable business model going forward.

Do a mind map. Put your end user/customer in the center. And then start mapping the various ways you can close a sale with that customer using different models, approaches and value propositions.

Figure out what needs to be true – the key assumptions – for each of the avenues and test the assumptions with customers, experts etc.

With a bit of luck and quite a lot of work you will be able to define the path of least resistance to the customer and notably to the customers wallet.

And that’s exactly what you need. That’s your future business model. Developed and understood by you, so you can effectively go and execute on it. Not something just taken from a shelf that you actually may have very little idea about how to make work for you and your startup.

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Keep winning

When looking at B2B startups, it’s super easy to get impressed by a well-executed growth model that brings new customers in in droves. Of course it is; sales is an art and can be a super tricky one at that, so every time a startup succeeds in closing a deal, it’s reason to celebrate.

But what I personally like to celebrate more is their ability to keep their customers happy by ensuring a high retention and thus a super low churn.

That – to me – is the most powerful indicator of a startup delivering real value to customers by successfully solving a problem, the customer has.

When I meet with startups there are always convincing narratives about how to find and attract new customers and close the deal. But with startups who already have their first product in market, I often find that the story becomes slightly less convincing, when we talk about retention and churn.

Sometimes the story about retention becomes so weird or non-logical that I just assume that the startup in question has a real problem in that department, and they are more than reluctant to share that with me. That – in all honesty – is a huge flag.

Having to work hard on retaining your customers is hard work and honest work. Because even though you may have a great product, lots of other startups or big corporations are out to get your customers with everything from a slightly better product to one that is just a lot cheaper (and perhaps even loss making) than what you have to offer.

You need to have a plan for keeping retention high, and you need to execute on it like your life depended on it. To some extent it does; at least the prospects of your startup ever becoming a viable business.

You need to show that you understand what’s going on, and that you understand what you need to do to keep your customers engaged, happy and finding the best value in your product. And you need to always optimize that approach to ensure that your win didn’t only happen once, when you closed the deal, but that by keeping the customer, you essentially have what it takes to keep on winning.

When you have that, it’s truly worth celebrating.

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Easy to buy

When you’re building something to solve peoples problems, it can be tempting to build feature after feature and try to sell them all to the customers at the same time.

What often happens is that it can be hard to get the customer engaged in a dialogue or a trial – simply because you’re overwhelming them with information about features, solutions etc that they have a hard time figuring out whether your product is actually a potential solution to the key problem you have.

As an alternative, you could start smaller. Start by telling about one thing that matters to a customer segment, who you know is experiencing the problem. Use that as a way of engaging in a dialogue or a trial, from which you can build from, upsell and secure an ongoing relationship to a future happy customers.

Start small. Be easy to buy. And then take it from there.

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Beware changing models

Can you start out with one type of business model and then transition to a new one without facing huge challenges?

The question is a valid one. And the answer is probably “No” in most cases. And it is worth exploring a bit further, as it’s often a topic that comes up when I meet with founders.

The issue with wanting to change the business model is that what I need and want as a founder and business owner is not necessarily the same as my customer needs and wants.

Let me a simple example from my own life as a customer:

When I order a case of wine from my preferred ‘wine pusher’, I expect it to be an interesting wine from a wine maker, I would otherwise never have heard of and at a reasonable price. Like I am used to.

I do not expect to get an offer for a wine they have produced themselves together with a chef, I have never heard of (even though it probably says something bad about me that I don’t). As I got the other day. And immediately decided to decline.

Why?

Because it broke the fundamental ‘contract’ I have with my regular supplier: You find regular wines from little known places that I can then get a good offer on. That’s the model, I have signed up for. You DON’T try to introduce your own brands into the mix, because that deviates from our ‘contract’.

Could I be more forgiving here and just try it out? Absolutely. And I fully expect that many of their customers do so. Otherwise they probably wouldn’t do it. But I think it goes to show how challenging it can be to make changes to your fundamental value proposition and business model.

I think you need to be very aware of this. Because while it may be tempting to try to change your business model to introduce new revenue streams, cut costs, increase sales, boost your bottom line or whatever, you won’t succeed in it if you’re out of sync with what your customers are expecting.

Don’t ever take even your loyal customers for granted.

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