What is the best way for an entrepreneur to balance demonstrating the large scope of his/her vision and opportunity space on the one hand, versus showing she is tighly focused on a realistic near term go-to-market strategy on the other hand?
Since I repeat this advice constantly, I figured I’d post it once and for all.
A recent discussion thread in the MassChallenge LinkedIn Group talked about this very issue, when, in answer to the question “What mistakes have you made when meeting with angel investors?” Matthew Hooper wrote:
Going off-topic, sharing too much vision and highlighting ancillary benefits. So far my biggest mistake been mentioning ancillary benefits of our business and technology. This led to confusion for some and for others, they simply wanted to box us into a category they were familiar with, no matter how different in the market. So I have learned to stay clear of additional benefits, repeat the core aspects of our business and then repeat them again.
I’d say Matthew is pretty self-aware. Going too wide or too inclusive can definitely dig you into a hole in a hurry.
But isn’t it also true that giving the impression that the market and opportunity you are chasing is too narrow and too small can also dig you into a hole? Yep.
So what’s an entrepreneur to do?
The advice I always give is to do both, but use some structure to make it clear you have a perspective on the situation. Think of it as if you were operating a lens: you need to both zoom out to give the big picture and zoom back in to show command of the granular execution details.
That sounds harder and more abstract than it really is. Here’s the key: talk about the different markets you could go into in sequential rather than parallel terms. So rather than saying “Our product is great, our market opportunity is huge! We can do this, and we can help these people with that, and we can also do those other things, and we can also do a bunch of other things too!”, instead try it like this:
“Our target customer has XYZ problem. They represent a large market and we are going to solve their problem for them in the following way (insert specific, realistic, near-term go-to-market plan). Once we are established in that market, we will tackle the adjacent ABC market. We are doing it in that order because (insert reason about how the first market has a lower cost of customer acquisition or a faster time to revenue or whatever your rationale.) So that is our near-to-mid-term plan. However, over the long term, we see significant potential for this technology to be applied in other contexts, and as we get to scale, it may prove possible and attractive to go into this third less related market or this fourth even less related market. That is where we ultimately see this company achieving huge scale. But in the near term, as I said, we are focusing on solving XYZ problem for these customers.”
Note the zoom in to start, then out for context and scope of potential, and then a strong close with a reiteration of the near term focus? Would hearing it that way make you feel like the description was coming from someone with a bit more of a clue? That is the power of structure. You have given mostly the same information, but you have done it in a way that is both easier to absorb and also more confidence-inspring for your investors. That is the power of laying it out in a sequenced roadmap.
When it comes to talking about your business, what you say can be less important than how you say it. In other words, the medium is the message.
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If you enjoyed this, you might enjoy: What I Look For In An Entrepreneur, Why Angels Chase Electrons, Are Entrepreneurs Wild Risk-Takers?, Pick Your Founder/Co-Investors Carefully & Reflections on the Nature of Entrepreneurs, Top 20 Dos & Don’ts with Angel Groups & Early Stage Financing, Delusional Economics, The Overture, The Power of An Advisory Board, Loch Ness, Unicorns & The First-Mover Advantage, Should I Wait For A Technical Co-Founder.
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