Getting Your First Customers: A Guide

Navigating Initial Hurdles: Revenue and Customer Acquisition for New Businesses

Launching a new venture presents numerous obstacles, particularly when refining a product and establishing a viable revenue model. While fundraising and administrative tasks are crucial, the primary objective remains selling your solution and generating income.

However, securing initial customers is paramount. How does a fledgling company convince potential clients to take a risk on an unproven offering?

Insights from TechCrunch Disrupt 2021

To address this question, a panel of seasoned technology leaders convened at TechCrunch Disrupt 2021. Participants included Kate Taylor, head of customer experience at Notion; Pablo Viguera, co-CEO and co-founder of Belvo; and Vineet Jain, CEO and co-founder of Egnyte.

These panelists’ respective companies demonstrate diverse revenue generation strategies. Egnyte, a content storage and management platform, employs a direct enterprise sales approach. Notion, a collaboration and organization tool, utilizes a freemium model, upselling to paid subscriptions with enhanced features. Belvo, a financial services API, monetizes its services as developers integrate the API into their products and users utilize them.

The Importance of Early Feedback and Iteration

Viguera emphasizes the need for simplicity in the initial product offering. He advises releasing a minimum viable product and actively soliciting customer feedback. “The initial version will inevitably differ significantly from iterations developed two or ten years later. Prioritize gathering feedback consistently, even within complex business structures,” he stated.

Taylor cautions against being overly swayed by all customer input. She suggests identifying a core group of dedicated users to guide product development. “[It’s essential to] mitigate distractions, as numerous product directions and feedback points will emerge. Focus on engaged users who can provide valuable insights into growth opportunities,” she explained.

Proactive Customer Outreach and Early Adoption

Viguera detailed his company’s early outreach efforts, targeting 50-60 companies through direct sales – door-to-door visits, phone calls, and LinkedIn connections. They also leveraged angel investors to identify potential early adopters, initially focusing on startups rather than larger enterprises.

Jain underscores the value of early adopters who demonstrate faith in your vision. He advocates for providing them with an exceptional post-sales experience. “These initial customers are invaluable and deserve utmost respect. A delightful experience fosters loyalty and growth, as demonstrated by our ‘champion tracking’ program,” he noted.

Strategic Marketing and Market Fit

Jain highlights that the optimal outreach strategy depends on the product, revenue model, and individual sales approach. His company initially targeted SMBs, leveraging search engine optimization (SEO) and search engine marketing (SEM) for rapid customer acquisition. Larger companies subsequently showed interest, allowing Egnyte to expand its market reach. The key takeaway is to prioritize product-market fit over initial customer demographics.

Taylor explains that Notion prioritized community building, cultivating a passionate user base to spread awareness. Combining this with a freemium model enabled them to focus on user acquisition and subsequent upselling.

Co-Creation and Iterative Development

Belvo transformed its initial target list into a group of 10-15 design partners who actively contributed to shaping the product’s first iteration. “We essentially co-created a product that resonated with these early companies based on their feedback,” Viguera explained.

This approach was predicated on the expectation that these partners would eventually become paying customers. Following this phase, Belvo participated in Y Combinator, refining its sales strategy for the initial product version.

Embracing Mistakes and Maintaining Focus

Jain advises founders to accept that mistakes are inevitable but to remain committed to their goals. “Early-stage companies often lack scale and budget, potentially leading to shortcuts. There’s also uncertainty regarding business model viability and growth trajectory,” he said. He emphasizes the importance of trusting that product-market fit will eventually materialize.

Balancing Customer Needs and Company Vision

As a company grows, Taylor stresses the need to balance customer expectations with the overall company vision and capabilities. “Engineering and sales hiring must be aligned to avoid conflict. Product development and go-to-market strategies should be synchronized to ensure effective execution,” she stated.

She adds, “Careful consideration must be given to product direction, product-market fit, and the supporting structures necessary to meet customer needs.”

Ultimately, while the methods may differ, the core objective remains consistent: to launch a business and persuade customers to purchase your offerings, be it pancakes or software.