Entrepreneurs and Intrapreneurs run on optimism. They get excited and see the possibilities. Like almost any positive trait, this inclination to get excited – and to excite others – can also have a downside.
The problem is the journey from the specific to the general. Typically, the flames of entrepreneurial passion are fueled by a single early customer story. The story is a big customer opportunity that not only is exciting on it’s own merits, but starts to look like one of many opportunities. In another blog post, I referred to this as The Golden Story – the story that is repeatedly shared around the company campfire and in front of prospects and potential investors so often that it attains mythic status.
Recently I had the opportunity to be a panelist as students from an innovation class at a local college presented their end-of-semester projects. I’ve done this sort of thing a number of times and I’m always struck by how big of a challenge these students are faced with. In the midst of their other classes and school obligations, and in a fairly short timeframe, they have to team with others, identify a plausible opportunity for a new product, do some quick market research, product development, and all the other tasks one would associate with a start-up. Layer on top of this is the fact that the students likely have very little expertise in these areas, and you understand the immensity of the challenge they’re faced with.
But most of the time they produce a solid effort, and my role is to add a little stress to the proceedings by evaluating their presentation and asking them questions. And this leads me to notice a common problem almost all of these teams seem to have, and if makes them feel any better, well-established companies and well-funded entrepreneurs often miss this as well.
It is the inability to clearly identify the path from the first customer to the eleventh.
In Disciplined Entrepreneurship, an excellent book by Bill Aulet that breaks the entrepreneurship journey into twenty-four discrete steps, step nine in the journey is “Identify Your Next 10 Customers”.
The value of this step is that it forces the entrepreneur to stop engaging in the reverie of lazy extrapolation, to dispel gauzy dreams of filthy lucre that await with little effort. Anyone can identify the first customer. What about the next ten? From Aulet’s book:
“One potential danger of focusing solely on your Persona is that you could build your business to be too specific, focused only on the Persona without the ability to sell to other customers.”
Identifying the next ten customers is really hard. It’s not the first ten you can name, or suspect will be buyers. It’s the next ten who you have personally contacted (in inquiry mode, not advocacy mode) and have provided you strong feedback based upon a set of criteria you created before making the calls. To arrive at these ten likely means many contacts – 20? 50?. Whatever the number, it’s a lot of work.
When we’re excited by an idea, we owe it to ourselves and our colleagues to ask tough questions. The answers will indicate if our excitement is warranted. Asking the question “who are our next ten customers” is a great place to start.