One of the questions discussed at our Lean Coffee morning last week was:
“Should we spend the time chasing investment, when we could be using that time spent perfecting our pitch building a business from the ground up?“
It was a balanced discussion with views on both sides.
There’s no right or wrong answer – every startup has a limited runway and investment can help extend that. However it can also be a distraction.
Also just because you have a great idea, this doesn’t mean that you’ll get funding. Any investor will need to believe in the team they’re supporting, and a sole founder will find it incredibly difficult.
Also the bar is a lot higher these days – investors are looking for more than just an idea and a solid team, they want to see a working product and signs of traction from customers.
But how do you get customers that care about what you’re doing?
Get hungry for insight
Conduct customer interviews, test prototypes or use tools such as our own Personapp or empathy mapping to really understand your customers and how you can make their life better through your product or service. This will help you to understand where the value lies and will ultimately help you sharpen your value proposition, meaning customers will be easier to come by.
As Kathy Sierra says, focus on making your users badass and you’ll have an awesome product.
Funding from revenues
One of the safest ways to ensure survival for your startup at the early stage is to have a business model that helps fund your early stage development.
We meet lots of startup founders that are more focused on building a pitch rather than building a business. So really think about whether your time is best spent seeking funding or whether you could use that time to find a customer that will pay for your product, even before you’ve built it. Then find another, and another. Get some customers and investment will come a lot easier.
Your Minimum Loveable Product isn’t just about creating a great product, but a passionate user base that loves you and will become an advocate for your business.
“When you take money from investors their business model becomes yours.” Steve Blank
So at the early stage try to focus on things that you can control – building a great product and a passionate customer base– than the things you can’t – chasing VCs, angel investors, etc.
Often money isn’t the problem, or solution.
Applications for our next Home School program are closing soon and we won’t be running another tribe until October. If you want to work towards launching your startup this year, apply now and learn the confidence, skills and toolset needed to build businesses the right way.
Visit home.thehappystartupschool.com for more info
“The best part of the home school is the powerful community of like-minded individuals it brings together. I started the course on my own, met another student with similar goals to mine, and in just a few weeks we’ve used everything we learnt through the course to start our new business the right way: purpose-driven, profitable… and most importantly, happy!“ Mike Harmer, UK from Tribe #2
The Happy Startups team will be tuning in to Do What You Love’s video series starting next week (April 27th). The Alchemy will follow the thoughts of inspiring individuals who believe in doing what they love and make it happen every day, exploring the process they’ve gone through to get from dream to reality. Series is running from April 27th-May 3rd 2015, with 1 video shared daily.