The one pitch many entrepreneurs are avoiding.
I’ve sat through many a meeting with an entrepreneur/startup, gone through amazing pitch decks and polished presentations trying to convince me to part with my bosses money. But one thing that I failed to see pretty much most of the time is the pitch to the customer.
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Here we are being convinced that we should part with hundreds of thousands of dollars, when placing myself in the shoe of the customer, I am unable to see if I would part with a few hundred dollars(more or less) to use the product. The sad part is that the industry has come from creating products(or solving problems), to focusing on how to raise money for the next step. In between, we have forgotten the customer, and to be truthful, this is the downfall of many a startup.
You can see startups trying to raise Series A funding, who have still not gone to market but are raising capital (and gaining fame on the media channels) with dreams of reaching their customers(in the future) when their ideas have still not been validated in the market.
Many famous entrepreneurs have written or spoken about going back to focus on the customer and bootstrapping your way through. This is not the howl of wolf that is deep in the forest, but of one that is right at your doorstep, not something to take lightly.
As investors get more conservative, it is crucial for entrepreneurs to start reaching out to customers as soon as possible. Having customers will bring in revenue, which should cut down one cost or another. Showing that you are breaking even or even making a small profit would be a great factor when it comes to convincing investors. And if you are making good profits, you may not even need to raise money at all.
Whether you are building a startup by solving a problem or even acting on an opportunity, it would be best to build a model that would take you to the customer first. Build your solution around the customer, bootstrap your way, and refine your pitch to get them to part with their money first. Having customers in your bag will take you way further than chasing smart money you may be chasing.