One of the most critical milestones a venture leader faces is finding that most mysterious and elusive of targets, Your Very First Customer. Often this journey is fraught with many challenges as your venture struggles to close its first deal, hopefully the first of many. But, having a good strategy can make a huge difference.
Here are some valuable insights on how to get to market and acquire your first customer quickly. The ultimate validation of your venture is finding the first customer who is willing to put hard dollars down on the table for your product or service. The sooner that happens, the better!
If you need more information on identifying and mapping your target market, check out my blog entitled In Search of Your Target Market – 6 Ways to Penetrate New Markets. That will give you some great ideas on how to find and attack your target market. Now let’s talk about where to look for your first customers.
Tap Into Your Product Validation and Review Group
As I’ve said in prior posts, it is important to utilize your network of contacts and relationships to find a group of 10-20 potential customers to help you define and refine your product and its pitch. This will ensure that you have a solid value proposition in the market and one that will give you critical, often times painful, feedback on your venture. Now is the time to take advantage of that group of customers.
Work within this group to find an early adopter and do everything in your power to convince them to be your first customer. If you’ve followed the approach I laid out, odds are they have had a significant impact on the road map for your product. Perhaps they have even been with you along the journey of your venture’s development and, as such, have a certain level of “investment” in your success. More importantly, they may have already identified the benefits of your venture’s product or service and how you can help them solve their core business problems and process issues.
This established trust and understanding of key benefits makes them the most logical first choice to pursue as an early adopter and your first customer. Temporarily adjust business models (cost structures, licensing terms or other non-core elements of your venture and its product) to land your first customer from this group.
Next Tap Into Your Network
As I’ve said before, focus your venture on your area of expertise (your wheelhouse). This gives you a number of advantages.
First and foremost, you can tap into your network of existing contacts for that critical first customer. The goal is to hone in on and target customers from your network that could be potential clients of yours. Take a methodical approach of looking at the leaders, the laggards and those suffering disruption to identify the potential first customer for your venture.
Keep in mind that, as your first customer, this organization is taking on perhaps enduring substantial risk, especially if it is a Fortune 1000 customer. Therefore, you will likely have to go outside the norms of what you were expecting to do for a customer – whether it’s price, service or delivery – to ensure that there is enough value-add for this first customer to commit to your platform and then subsequently sign up.
However, having that first customer will provide the ultimate validation in the market for other customers and also can serve as a reference marker or milestone for important funding events moving forward. For more information on funding, check out Three Keys to Successful Fundraising.
Consider the Trade, Industry or Business Press Articles
Are there customers identified in the press that are highlighted for behavior outside the norm? Once again, ask yourself if they are leading, lagging or facing a major disruption? This is similar to the approach for identifying your target market, but the difference here is you are looking for a narrow list of one or a few companies to target as your first customer, as opposed to using this insight to identify an entire market.
Once you have this shortlist of companies, pursue them aggressively and relentlessly. You know they are encountering headwinds in the market or leading the charge, as such, you have more than enough information to position your product to help them with their difficult situation or to lead their charge. That insight will make every conversation more productive and ultimately lead you to the key decision maker, in the right role, with the need and appetite to close the deal.
Industry or trade analysts are a good source to help you identify your first customer. These folks often have a much broader visibility into the market than any one venture – after all, that is what they are paid to do by their clients. They are also often astute observers of the market so they can help you understand how to position your product for success.
More importantly, they can connect you to the few companies in the best position to avail themselves of your product or service. Consulting with analysts can often provide that independent, objective 3rd party analysis that first customers can rely upon as they seek to justify to their own internal management rationale for picking your venture and product to meet their need.
Pierce the Armor of the F1000
Remember that it’s not only the individual you are selling to in the Fortune 1000 case; often its their entire enterprise. Decisions and actions taken in an F1000 customer generally do not remain in one small area or division. They often spread, like a proverbial wildfire, into multiple divisions or other parts of the organization.
Therefore, F1000 companies tend to be a bit more cautious before entering into a deal, but once a venture’s sales team is able to pierce the armor, their ability to rapidly and exponentially expand is often without comparison in the marketplace. This is the main reason why F1000 customers are so valuable and are also a common pursuit.
RFPs, RFIs, and RFQs
Another possible channel to find your first customer is to participate in competitive RFPs/RFIs/RFQs (requests for proposals, information and quotes) for your product or service. If you truly do have a unique value proposition for the market, then you’ll be able to convert that into a winning proposal and bid for business.
An RFP enables your venture to compete with others (on equal footing) to satisfy a customer’s need. Depending upon the industry and use case, these RFPs are generally made available by customers through various channels and in some cases, like the federal government, they are even published!
Utilizing this approach to find your first customer gives you the added benefit of potentially landing a client who has already identified their needs and requirement, all you have to do is demonstrate how your product meets or exceeds all others in the marketplace. Often there is no better method to get a true sense of what your venture has built and how it compares to the competition.
The Inside Tip
Sometimes head-to-head competition reveals some ugly truths – either about the market, your
competition or your product and value proposition. The key to success is recognizing that the outcome of these head-to-head battles is critical feedback and what you hear will help you determine changes necessary to enable your venture to succeed. These tips can also help you proactively prepare responses to these kinds of comments moving forward.
Do NOT ignore this feedback; especially if this is the 3rd, 4th or 5th time you’ve heard it. Successful venture leaders listen to what the market is telling them and quickly change direction when necessary. Oftentimes the product course will need to be changed to deliver what your customers need. Markets shift quickly; therefore, your venture will need to be nimble.
It is extremely valuable to teach your salespeople how to deal with these potential objections during the sales cycle. For more information on objections, read my blog entitled Dealing With Objections and Rejections.
Target Industry Conferences, Summits and Trade Shows
Finally, consider industry events and trade shows as a place to meet your first customer. I don’t think this is the best source for your first customer, because most folks coming to these types of events are looking for tried-and-tested solutions to their problems. However, across my seven ventures, I’ve seen enough cases of new ventures being successfully launched based on a deal won or a customer identified at a trade show, that I would give a lukewarm nod to this option.
However, this approach is last on my list for a reason. Trade shows are more of a traditional channel and approach for mainstream industry and ventures. That means that finding those willing to take a risk on a new venture in this type of venue is not easy. The critical factor for finding a first customer in an industry trade show is breaking through the “noise” at these types of events.
If you decide to go this route, I recommend that you tap into the expertise of an events specialist group – one with experience in the industry or in the kinds of events you’ll be participating in. Often these organizations, while potentially more expensive than “going it alone”, offer deep insight and contacts that ensure that your presence at an event doesn’t go unnoticed and you get the potential pipeline of target customers coming out of the event that will lead to your critical first customer!
Finding that first customer is often one of the most difficult challenges for a venture. It is where the proverbial rubber meets the road and it can be one of the most trying times on your journey to venture success. However, remember that the more difficult the journey, the sweeter the taste of success at the end.
I welcome your comments, questions, feedback and insights below or feel free to email me directly here. Please read and share all my blogs at LeadingVentures.com.
About this blog – The goal of this blog is to share my experiences, to capture and reveal valuable insights, and to draw from my serial entrepreneur-ship through 7 ventures over the past 20 years. I have encountered many impressive entrepreneurs along the way and I hope to share our collective experience with you to help teach and perhaps motivate you to launch your own B2B or B2C enterprise.
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Thanks, this is a good article . However I would add the digital networking aspect. B2B eplatforms like Alibaba ou more verticalized ones help us learn from prospects and catch new clients x-the world
I would agree with you – networking – in all its forms, whether digital or face-to-face – is critical to the success of any venture. Especially as you note in the B2B space – where customer and client interactions are more meaningful.
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