Your Most Important Startup Lesson: Own Your Pond Before Anyone Else Does
Of all the lessons we give startups and entrepreneurs, there’s one that sets the stage perfectly. Before anything else, own your pond. It presumes you defined your pond – positioning yourself uniquely in a marketplace.
It’s easy to find a single customer or potential market tactic and adjust everything to “get” them. Sprinting toward that first sale. Unfortunately, if you jump directly into sales and revenue creation before you’ve built your foundation, you risk instability, or worse.
There’s a chance this customer isn’t the right target for your business. They may have specific needs that the rest of the industry doesn’t. But, you cater your offering to those and create something that can’t be used with others. This customer you reach at breakneck speed may be a ‘one-off’; may be ‘over-reaching’ for what is required for you to own your pond; might not pay their bills; or may fail before you prove out the value proposition. The permutations are endless…
Avoid the trap by defining your business, target, and proposition, and then create a unique story you can own (call it your brand). It’s the perfect way to always be the big fish, no matter the size of the pond itself.
Let’s dive into how you can own the pond. It starts with a quick note on the fear that often drives companies to run before they can walk.
The report of your failure was an exaggeration
In 1897, Mark Twain was asked about rumors and newspaper reports of his death. He famously quipped: “The report of my death was an exaggeration.”
Hold that in your thought in your mind. The reports of the failure rates your start-up and those like it will see may also be greatly exaggerated. The apocryphal saying is that 90% of startups fail. However, actual data shows that it is much closer to 60%.
If we take 100 startups, that means conventional wisdom would tell us that 10 make it. Reality says that 40 make it. Going from 10 to 40 successful companies is a jump of 300%.
Why then, are we still inclined to feel like the conventional wisdom is right? Fear.
According to the same Cambridge study, there were still more than 16,000 start-ups that failed between 1990 and 2010. We all worry that we’ll be in the bottom rung because we’re not showing our value right — not looking like the big fish.
It turns out that this positioning might be everything. As you’ve likely heard, positioning theory pundits love the ‘’big fish, small pond’ adage because it is proven out. Once someone gains top-of-mind status, they’re hard to supplant.
When you’re about to sneeze, don’t you always ask for a Kleenex®, regardless of the brand at hand?
Put your positioning first
At GrowthShift, we also think a large percentage of the 60% stems from companies who jump too early. Not having a clear definition of what your business is may leave you adrift when you hit that first dead end.
Or, as is often the case, perhaps you’ll land one decent client but then are required to make the proverbial ‘pivot’ in positioning, messaging, and occasionally in offering. This shift confuses existing and new customers. They’re not sure what your business is because you’re not sure, and that affects the essential trust needed for any sale.
It’s all about the trust you build with your buying audience. Trust is fundamental to the buyer’s psychology, and we’ll expand on this topic further next time. (Be sure to check out our previous posts on why it’s important to tell your story and how we at GrowthShift tell our story first.)
You have the opportunity to drive every conversation by the way you present or position yourself. We advise clients to position carefully which establishes you as a unique and long-term solution for a known market/customer problem, rather than a reaction to short-term revenue opportunities.
Tell your customers that it is a big problem, but that you’re a big fish. It’s nothing you can’t handle.
Tell your story believably and customers will agree, plus they’ll see your pond as a little smaller. In their minds, you’re already able to adapt to future needs as well as larger markets, reinforcing the idea of your company involving less risk and more safety.
Define your pond through simple exclusivity
You must define your company and your value proposition in an exclusive way before you can communicate anything to customers.
You lose when your story isn’t unique, when it doesn’t stand out, or if it’s too complicated for customers to understand. These all make sales cycles too long so you can’t close deals fast enough to fund the operation, satisfy your investors, or both…
Demonstrate your value through your value proposition. Explain what makes you unique and how you’re specifically able to target your customer’s needs.
Hit them with the one-two punch:
- You’re uniquely positioned to help; and
- Your proposition is repeatable – and not too narrow – so as to grow a business and own your pond.
Solve a need they know they have now, so you can earn the right to solve others they may not be aware of next. Do this right by keeping things simple, because simple can still be powerful.
A book we’ve enjoyed lately is “Positioning” from Al Ries and Jack Trout. This breakdown of its lessons puts things in the right perspective: “The best approach to take in an over-communicated society is an oversimplified message. In communication, as in architecture, less is more.”
Your sales efforts for 12-36 months down the road starts today
Dear startup, that’s your takeaway in all this.
Everything you do today will echo for years to come. Getting it right puts you in a great position to keep doing it right. Stumbling out the gate means you’re always making up for lost time and missteps. It’s never impossible to overcome, but it is more difficult.
Keeping things simple makes it easier to do, so people see you as that big, glorious fish.
Get in touch and we’ll show you what you need to do to create that winning plan. By defining your position, unique value and consistently showcasing it to customers, you can compete no matter who your customers are.
Next time, we’ll discuss that, no matter who you are and what you do, you have competition. Stay tuned to learn about how you’re competing with:
- Other companies in the market
- Other solutions that also do what you do
- Customer apathy toward the problem you want to solve
- Discoverability: rising above the noise that dominates the Internet
Define your pond, and dominate it!