🎯 The #1 Reason Why Tech Startups Fail! Interview: Part 2.

(3-minute read)

Hello!

Part 2 of our interview with Dawn Haynes, CEO of a tech accelerator.

👀 In today's edition:

• 🚀 We learn about the process of customer discovery, which is EVERYTHING if you are creating a tech startup.

• 🏛 We recommend a great entrepreneurship course for beginners.

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Today’s Topic:
Part 2. Customer Discovery and Your Unique Value Proposition. With Dawn Haynes.

StarterStudio is located in Orlando, Florida. It is a non-profit accelerator that helps tech entrepreneurs at all early startup stages, from idea, to build and pre-seed growth. The CEO of StarterStudio lends her expertise to help us move our startup ideas forward.

▶ Part 1 of this interview, which covers the first steps in the ‘Idea Stage’ is archived on our site, here: Interview, Part 1  ◀

Let’s jump right in with part 2.

👦 Aron: 

Now that we have startup founders on the right track, let’s talk about customer interviews. What advice do you give your tech startup founders about customer discovery?

👉 (this is important!) 👈


👱‍♀️ Dawn: 

We advocate for at least 100 Customer Discovery conversations. This process alone, addresses the #1 cause of failure for all entrepreneurial tech startups … that there is no market for their idea!

Customer Discovery, completed proficiently, will provide incredible business intelligence on which to build your startup:

• Validation of the real problem you are solving

• The different pain points (and degree of pain) experienced by potential customers

• The current options / alternatives being used to address the problem

• What works / doesn’t work with those alternatives

• Does your idea (solution) fully solve the problem and related pain points

• Who will be willing to pay for your solution and how much they’ll pay

• The unique value proposition of your solution

• The messaging that will resonate with potential customers
  

👦 Aron:

Ok, where should entrepreneurs be looking to find these people? Is this where industry experience (which we discussed in Part 1) comes into play?

👱‍♀️ Dawn: 

Yes, for B2B, having that industry experience and network is invaluable. Whether a founder accesses people through personal networks or having access to industry conferences, professional associations etc., they can focus on the appropriate target audience.

For B2C, it’s about identifying your target customer segments, and then determining where you can find them, reach them and engage with them for conversation.

“This is the #1 cause of failure for all entrepreneurial tech startups … there is no market for their idea!”

👦 Aron:

We know every tech startup needs a unique value proposition that separates them from the pack. Briefly, if someone were to consider their ‘UVP’, how should they approach that?

👱‍♀️ Dawn:

Your UVP becomes easier to identify and determine the more customer discovery you complete. When you think about some of the business intel we covered earlier, there’s a wealth of information to explore about how someone is currently attempting to solve the problem, and what’s working and what’s not!

Current alternatives may not be a single competitor product / service, but a workaround using a variety of different tools. Understanding, from the customer perspective, the advantages and disadvantages of a directly competitive product or an alternative, enables a founder to identify the ‘benefits’ a potential customer will need to derive from a new solution in order to make the ‘switch’.

Remember, there’s always a level of ‘pain’ involved in change. So, the pain of change needs to be less than the pain of staying where they are for someone to be willing to change their behavior, as well as to pay for the alternative solution.

Learning directly from your potential customers about how well those current solutions work is gold!

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👦 Aron: 

It all comes down to solving a real problem for a customer.
Can you describe the endless cycle of trial and error that comes if an entrepreneur solely chases an idea that pops in their head?

👱‍♀️ Dawn: 

The cycle of trial and error without good customer discovery can lead to an enormous waste of time, effort and especially money.

Nothing breaks my heart more than to hear from a founder about the time, effort and significant money they’ve already spent developing an idea and related MVP without validating they have a real problem to solve for real customers.

Validating the problem and identifying your problem / solution fit needs to be done expediently before you do any work to develop your solution!

👦 Aron:

Finally, communicating is a learned skill in the startup world.

If someone has 30 seconds to tell someone about themselves and their idea, how would you structure that elevator pitch (background, idea, problem, potential upside etc.)?

👱‍♀️ Dawn: 

It needs to be super clear and succinct:

✅ What you do

✅ Who you do it for

✅ What’s the benefit

Here’s an example: Decentralist.com

Our website helps both web3 natives and new users who want to find web3 information, organizations and projects by offering an easy-to-use directory. Unlike other web applications, Decentralist.com is continuously updated, easy to understand, and a breeze to navigate.

✅ What you do: a website offering an easy-to-use directory of web3 resources

✅ Who you do it for: web3 natives and new users

✅ What's the benefit: continuously updated, easy to understand, a breeze to navigate

⏸ Do This Today!

If you are creating a tech startup, let’s take Dawn’s advice and do this right now:

• Identify your ideal target audience and determine where they hang out (both online and offline).

• Start conducting interviews with these potential customers. Uncover the strongest pain points they are experiencing. Do NOT lead them to your solution just yet.

• Make notes of what you learn and evaluate if your idea / solution fully solves the problem these people are having.

  
  

🙏 Thank You Dawn!

We really appreciate Dawn sharing the tech accelerator’s playbook with us!

⌨ For more information on StarterStudio, check out the three main programs they have, below. They cover tech startups at all stages:


IDEA STAGE ACCELERATOR

BUILD STAGE ACCELERATOR

PRE-SEED STAGE ACCELERATOR

** StarterStudio is a nonprofit, early-stage tech startup accelerator. They offer cohort-based hybrid programs for founders located nationally and internationally to learn and apply the valuable skills and disciplines required for success at the different phases of their entrepreneurial journey. They connect founders to the relevant resources, coaches, subject matter experts and investors necessary to progress their venture. **

That’s it for today. 

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