The beachhead pitfall

Every time I see a startup pitch for funding, the founders include an assessment of the size of the market, they are going after. The more detailed ones also give an assessment of the size of that market, they believe they can make their own and why.

It is all well and good. Sometimes I might even think that the slide is in the boilerplate department, where it’s there because it’s expected, but it’s not the most sexy or informative slide.

But what I have learned is that it is actually more important than that. That if you get this wrong or don’t think enough of it, you can potentially end up in a place, where you and your startup find yourselves stuck between a rock and a hard place.

Why that is has something to do with the first share of land, you grab in your market – the beachhead.

Normally, when we talk about beachheads, we refer to them as a representation of the segment you go for first in order to prove your value proposition and achieve the illustrious Product-Market Fit. It’s your assessment of where the best match between your customers pain and the relief, you can bring to the customer, is the best at this particular stage of your startups life.

You go after a beachhead, because you want to get traction ASAP to show your investors – and potentially also the first significant revenue to show for it. And it makes total sense.

But – and this is a big but – if you’re not mindful about the bigger market opportunity, your specific plans to get there and the narrative about what you’re doing right now, you run the real risk of getting stuck in the midst of what otherwise might look like a success.

What could potentially happen, if you’re not careful, is that your beachhead becomes your market. That what was once thought of as the first small slice of a big cake becomes the entire cake.

If that happens you may develop a super strong position in a niche market, but you will never be able to scale your business to the bigger market opportunity, you will need in order to find investors, who are willing to put up the ressources required to be there. In other words you risk turning into an ok business on the longer term rather than an amazing business. Which – without saying anything bad about ok businesses in general – just seems like a wasted opportunity.

And this is where we come back to the role of the beachhead.

It is super easy to get excited about your beachhead, when you start seeing traction in it. You naturally want more, and you want to build on the early success. And you can do that, but you need to control the narrative.

You need to keep telling yourself, your investors and everybody else who might listen that what you’re currently doing is NOT the end goal but just a beachhead. That while you’re killing it in your beach head, you understand the fundamental dynamics and value of your product in a larger context for different segments of customers, and you’re well on your way towards branching out.

Thus, your narrative and your operations becomes about the beachhead based on what a beachhead should be; a stepping tone towards making real landgrab in land. If you can balance the two stories about what’s happening now and where you’re taking it, you’ll have a much more compelling story to tell. Not least to the investors, you will need to enable you to get the ressources you need to make real landgrab and fulfill the potential, you set out to fulfill.

If you don’t get this right, the risk is that you end up becoming a de facto niche player doing a stellar job in too small a market that no investor really sees the upside in. And if that happens being able to move the needle and move inland will become infinitely harder. Just don’t go there, when there is an alternative that is so much better by just being more conscious about how you stay the course.

(Photo by frank mckenna on Unsplash)

Always be pitching

When you’re trying to get a startup off the ground, one of the things you spend most time on is…

Pitching.

Of course you pitch for investment or just any sort of backing really, because you need the support and all the ressources, you can muster, for the journey ahead.

But the pitching doesn’t stop there;

You pitch to future team members trying to get them onboard with the mission, generate excitement and – hopefully – install the love of the problem, you yourself feel, and which you just know is the secret sauce that will be key to (a) getting them onboard and (b) getting them to give it their all.

You pitch to existing team members and collaborators all across the pitch as you try to keep hold of and build the coalition, you have worked so hard to create, out (because no, any chance of success is not just about you – it is always about the team), so that in turn can crank out some impressive results.

You pitch to your backers to keep them engaged, excited and confident that they made the right decision when they decided to support whatever it is that you’re trying to do.

You pitch when you sit in meetings with your team discussing what the next experiment should look like, how it should look, feel and perform, because you’re most often the direct link back to your customers and their needs, pains and gains.

And of course – and perhaps most importantly – you pitch to existing and future customers; you go about trying to understand how you can help them become better off, and you pitch different proposals for solutions to them until you find the one that resonates the most. And then build from there. And pitch again. That job NEVER ends. And shouldn’t.

But pitching is hard work, no matter the context. So not being afraid to pitch helps. And being a good communicator does, too.

So if you think you lack something in the communication department, maybe that’s where you should be looking to invest some time and perhaps a little money in your own personal and professional development.

My best bet is that it will be worth it.

(Photo: Pixabay.com)

Falling in love

One of the things I have learned when working to build a startup team is that if you run a recruitment process trying to find the right co-founders, there is a huge risk you will eventually get to talk to people basically looking for a job.

Like in a normal recruitment process? Duuh!

Saying this I mean absolutely no disrespect to the great people, I have met and talked to. Far from it. They are truly great.

What I do mean though is that when you’re trying to find the right candidate with co-founder potential for a startup in a very short period of time, the odds that you will run into the person, who is just deeply in love with the problem, you’re looking to solve – like yourself should be – is really really poor.

That – to me – is a lot of what separates a co-founder from a key hire but nonetheless a hire.

Meeting the potential co-founder during a recruitment process is most likely down to sheer luck. And it’s totally awesome if it happens. Absolutely.

But should you count on getting lucky?

What I have found you most likely will get instead are great people

(1) looking to buy into a very convincing pitch,

(2) comparing what you’re offering with the job they already have,

(3) looking for an economic incentive on the short term that looks like the one they already have in their present role and

(4) have a deep feeling of uncertainty about risking the jump from something they know well and which feels safe into something they know nothing about and just seems fraught with risk and pitfalls.

And it is super natural. Because they don’t know any better yet. And because they haven’t had time to fall in love with the problem, yet.

The learning?

Start super early getting in touch with people, networking, sharing ideas and building that sense of needing to do something to fix a shared understanding of a problem.

In fact, you can probably not start early enough.

Don’t put expectations too high. Don’t demand anything of the people you connect with in the process. Let it grow on them and keep notes of those who look like they’re really getting to the place, where they need to be in order to make the perfect potential co-founder for your startup.

Share the love. Feel it. As deeply as possible.

Why is falling in love with the problem so important?

For a couple of reasons:

First of all, I have a deep sense that falling in love with the problem and – by extension – those who are experiencing the problem is fundamental towards developing and going to market with a killer solution for it.

Second – and this is perhaps the most important part for the individual – is that as times do get tough and not everything is easy, it is the love for the problem and potentially being on a course to solve it that will play a big role carrying you through the hardship – and help you and your team ultimately prevail.

Without it, you instead risk ending up deeply lost.

(Photo: Pixabay.com)

We have the first winner

Yesterday marked the climax of our iQnite case competition on climate change at inQvation. 5 teams pitched their ideas for solutions in front of a very experienced and competetent panel.

All the teams did a great job, and in the end Kleen Hub ran away with it. I will now get the opportunity to help them grow their circular concept within fast food packaging over the coming months. It is a really great team with an equally great idea, and I can’t wait to get started.

It has been an amazing experience to start from scratch with no more than a vague idea and then finish off with being able to crown a winner. We have learned a lot from it – the good and the not so good – and we will spend the coming weeks reflecting and documenting our learnings, so we can hopefully return with a new edition of the iQnite case competition at some later point.

(Photo: Personal)

Will they pay?

One of the things that always concern me about doing B2B related products and services is that the user is almost always different from the one who is actually paying the bill. What might constitute a problem for someone down in the organization can be totally overlooked at C-level, making it super hard to get the good solution in the hands of the people who actually need it.

I think there are several ways to try to deal with this. One is the obvious one: Make the solution so inexpensive that it falls well within the limits of discretionary spending that people in the organization may have. In other words: Give them the opportunity to buy it themselves.

The other one is more of a workaround but nonetheless important: Develop the pitch for the C-suite and KNOW full well that aside from having to convince your users, there is a key task in being able to make the hard sell where the money is. If that is where it’s at, it should be as important for you as building the product itself.

(Photo: Pixabay.com)