If you want a start-up to achieve its potential get the key players to focus on their markets from day one.
Brilliant ideas and brilliant people don’t always make a great commercial success. All too often, spin-outs and start-ups are driven by innovation, controlled by the inventors, and get obsessed by what they can do rather than focusing on the benefits they can offer to potential markets.
Clearly – innovation and a decent IP platform are critical to success but these aren’t things many future customers will care about. When we talk to start-ups, we often start by asking whether they’re creating a new market or trying to grab a share of an existing one. Anyone with experience will know establishing a new market is no easy task whilst getting an existing marketing to switch to a new product/service can be just as challenging. Using words like “disrupting” doesn’t change this! “Our neural networks can work with incomplete data and produce results that are statistically robust” might be true, might be interesting to an academic pier group, but is not going to win any business. If you are investing in academic spin-outs be warned, they don’t like talking the customers language. Frankly – these people don’t tend to “trust marketing”
And there’s another problem, proof of concept is not necessarily proof of potential. Spin-outs are often focussed on a market where they’ve had some success, they want to show what they’ve done, it’s a much easier pitch and they have evidence they can rely on. All too often this can mean low hanging fruit is simply ignored.
As seed fund money runs out some of this begins to dawn on our poor inventors but by then they’re set in their ways, don’t want to change their websites, are chasing deals in an increasing sense of desperation and generally aren’t in the positive state of mind they started out in.
Clearly this bleak picture doesn’t apply in every scenario but it’s an all too common state of affairs. But what can be done? Bringing in some marketing talent at a very early stage could change things – particularly if championed by investors. Partnering with a decent marketing agency on day one will bring a clear commercial focus, focusing minds on key potential customers, putting an emphasis on benefits and reasons to buy, creating bold communications and empowering the team.
This doesn’t need to be a lengthy or expensive process and it should be driven by investors. Remember, that every start-up has a logo and a website and that’s typically all they think is needed. Usually these basic “marketing packages” don’t cost too much and are often created by the inventors themselves – whether they are fit for purpose is the question that needs asking!