Most businesses eventually reach a point where it’s time to think strategically — often when talking to VCs, joining an incubator like Lever, or preparing for scale. From the thousands of business pitches we’ve heard over the years, a few patterns consistently emerge for those strategies most likely to succeed — and those that miss the mark. Here are some tips for putting you on the right track.
Focus on the “Why”
A common mistake for first time entrepreneurs is focusing too much on the “What” — what the product or service is, what it does, what features it offers. Some go even deeper into the “How” — how it’s built, how it will be sold, how it works.
But successful strategy always begins with “Why.”
This is the origin of the old phrase, “The people who know ‘How’ will always work for the people who know ‘Why.’” Your strategy should reflect how you see the current market, and what your business is going to change within it.
Investor meetings often feel like a coin flip. You pitch your vision, and they either align with your “Why,” or they don’t. If they do, the conversation continues. If not, you’ll hear things like “Let’s stay in touch.”
Worse still is the “ugly baby” conversation, where no one wants to tell you that your idea isn’t viable. Instead of getting reasons why they won’t invest, you’ll hear polite brush-offs like “Send more info” or “Let’s circle back.”
Take note: Honest feedback is a gift. If someone is willing to share their candid view of the market with regard to your product or service, listen to what they have to say. What you take away from difficult conversations like these can make a difference in steering your business toward success.
Once you can clearly articulate the “Why” for your venture, read Seth Godin’s “This is Strategy” for additional tools to help you explain how you are going to get there. It’s filled with examples on how to use empathy, and ways to understand the games behind systems so that you can move them in your direction.
Understand the Motives and Momentum of the Market
Every new product is, by definition, disruptive — a challenge to the existing system. The problem is that the primary goal of a system is to preserve the status quo.
Empathy can provide insight on how the current system works for a customer. Use this understanding of where they’re going to shape your vision of how you can move them forward in a more efficient way. The goal isn’t to change your customer’s mind. It’s to convince them that your product is a better, faster path to what they already want.
Customers (and investors) will buy into your product if they see it as a natural progression or a necessary evolution — not a disruption that makes their lives more confusing or difficult. Customers don’t care about you, your effort, or your ambition. They care about their own needs. Until and unless what you offer feels like a natural next step, most will resist it.
Ask yourself:
Where are your customers now?
Where do they want to go?
How can you get in front of them with a better path forward?
Good luck strategizing! And, if you’re looking for further support, feel free to reach out to MFN at any time via the Slack group or directly to anyone on the Lever team.
