I was talking to a good friend who founded a very successful SaaS (Software as a Service) startup a few years ago and is currently considering a major new direction for their product.
He asked me about my opinion on this new direction and the sales implications of targeting a particular market with a very particular approach. As I asked more questions to dig deeper into the matter, he said one thing that raised an immediate red flag for me.
Beeeeep! Wrong answer!
The best way to discover if your product has a real market is to SELL FIRST and BUILD SECOND.
I told him what I always tell founders, "You need to charge for the product today."
No matter if it’s ready or not. See here is the thing: getting interest from businesses and getting customers are not the same thing. Not even close.
You want to test interested parties to discover if they are true buyers with real buying intent.
But how do you do that when you know they need these key features that are missing? How can you charge for something that doesn't exist yet?
It’s simple.
Give Incentives
They might not be able to benefit from the product/features they need right away (since you haven't built it yet), but they can pay upfront in order to receive one of two key benefits:
- A massive discount for pre-ordering your product
- A shortened timeline for the feature/product release if they commit today
The Minimum Viable Pitch
Here’s what you say:
Most Prospects Won't Bite and That's OK
If they are not interested in this deal, they are likely not a real early customer.
Their pain is not big enough, and their intent to purchase is not strong enough to excite them about these benefits.
But if you can’t close one out of five or ten prospective customers on this early-bird deal, you’re in trouble and might not be on to something in the first place. You might want to spend a bit more time validating that there is a real demand for this product/feature before spending months and millions in feature development.
This is Exactly How We Got Started
Here’s a little secret: ElasticSales and Close started like this. We sold our service before we could even deliver it before our company existed.
You can listen to the whole story in my Pioneers talk (skip to 3:44 in the video; that’s where I start to tell the story of how we charged money for our sales-on-demand service before it even existed).
Fast Track to Product/Market Fit
The hardest (and most important) thing in the early phase of every startup is getting to product/market fit. Don't build and then sell. Do it in reverse. Once you have people who give you real $$$ to get the chance to buy your product earlier and for a discount, you know you're really on to something worth building.
It’s a simple strategy that will help you get to the product/market faster and with less pain.
