User Hacking for Startups

Written by Liz Derks on the 20th of April, 2017

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Wanna know more about startup sales? We spoke to startup legend Alan Jones to get the low down…

There’s this really compelling and exciting myth about tech startups, that you might be able to create a product that solves a valuable problem so well that every customer that gets introduced to it gets excited about it and suddenly the whole world is using your product and you’ve never had to do any sales or marketing.

For those of us who don’t consider ourselves sales people, that’s a really compelling situation. Because not only is the whole world sharing your product but they’re using it because they love what you’ve done. Huge reward if you can pull that off right? But in reality only one in several million tech startups manage to achieve that. And usually it happens by accident.

The Startup Sales Challenge

As startups, we’re selling something that doesn’t exist yet and that’s where I think the challenge exists. You can’t just say to someone this thing is going to have this feature someday because they’ll just say “we will come back to you when it exists”.

So the challenge is reaching out to people beyond just the feature and price; we have to reach out to their heart.

There are 3 layers of customers

  • The first customer is someone who is going to pay for your product or service today.
  • The second kind of customer is someone who’s a distributor, someone who can intro you to their customer and reach more potential customers than you could yourself and you’ll share some benefits with that customer.
  • And the third type of customer is someone who would fit into your customer demographic and they can see that they can one day make more from your customers than you can yourself.

It’s important to start thinking about these different layers of customers because the second customer becomes important when you need to grow more than your current advertising budget allows and the third when you want to get an actual cash value out of the business at the end.

Remember the Bigger Picture

You will need to start thinking about the second and third customer from the beginning but also need to get some revenue on board so that when you meet with those distributors and meet with those potential buyers of your company you’re able to say; this is how many people we reach in a month and this the percentage of those that we’re able to convert to paying customers. This is the product and this is why we’re growing and why one day, when we’ve got 10 million of these customers, you might be interested in acquiring us.

What does Startup Sales Success look like

We know that we’ve got a successful startup when we’ve got one paying customer at the bottom of the funnel whose lifetime value is more than what it costs to advertise at the top of the funnel.

A successful founder is someone who can sell without even being aware that they’re selling.

Selling is something that people are doing 24/7; if they’re awake they’re selling. So you’re selling yourself as a founder, you’re selling to a customer and every person that might be related to someone who’s a customer. And along the way you have to show that there’s this idea that’s going to change this big problem.

To catch up on all the episodes and watch next week, stay tuned here!

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