Blastoff: Building Your Business With Connections

People often ask me how they should get their first client. This is an awesome question… 

Honestly – If you don’t have some close connections to potential customers before you start, then you’re not really stacking the deck in your favor and you’re going to have to work way harder to be successful. New business ventures are always risky and your most important mid-term objective is to systematically eliminate as much risk as you possibly can. Having potential customers lined up before you build something is essential (What are the best-kept secrets about startups?).

This ultimately comes down to an industry expertise problem. If you don’t have potential customers, references, and a track record of past successes, then how on earth are you going to create a new product that solves a serious pain and then sell it for a profit?

In most cases, you need to have deep expertise in your sub-market to be successful and that’s simply not possible if you don’t have a fair number of connections into that market.

Without pre-established relationships:

  • How can you get feedback on your idea? (note that I said idea, notproduct/service, since you definitely should not build anything before you’ve gotten lots of market validation).
  • Who’s going to tell you what you’re doing right or wrong?
  • Who’s going to be the first to take a chance on this and buy it from you? who will be second? third?
  • Who’s going to introduce you to other customers once you’ve exhausted your connections?

Rule of Thumb: You don’t know anything…unless you (or someone you trust) has collected evidence to support your claim. It’s simply a hypothesis until you’ve collected data. Also, beware of the trap of thinking that you’ve proven Hypothesis A when you’ve really proven Hypothesis B.

Example Hypotheses:

Hypothesis 1) Young professionals will love a clear soft drink that’s pre-mixed with gin.

Great hypothesis. Go test it. Mix up some Sprite and Bombay Sapphire and slip it on the shelves of your local supermarket or liquor store (after acknowledging that you’re probably breaking the law). Watch people either buy it or not. Go talk to them after they put it in their cart or don’t. Disclaimer: Don’t get caught and blame me later.

Hypothesis 2) Big oil companies will pay $15k per license for software tools that show off-shore equipment spec sheets on an iPad.

GREAT hypothesis. Go test it. With deep expertise, you can make mockups in 2-3 hours and put it in front of your buddies who are in the oil & gas industry. Listen to their feedback, ask them who else you should talk to. Iterate and ask them for the money to build the most important piece. Their answer (vs your guess) says everything that you need to know.

Bottom LineWithout deep expertise, you’ve got an uphill battle. In order to be successful, you’ll have to make connections, gain expertise, refine your idea, build a great product, AND attempt to make sales… Personally, I’d rather invest my time, money, and energy into a venture where I only have to do 1 or 2 of those things to be successful! Set yourself up for success.

PS: Go read Crossing the Chasm – especially if you’re doing an enterprise or B2B sale. When your ready to start testing your hypothesis check out my post The Scalpel & The Axe: What to do After The Brainstorm.