products with their friends and colleagues, send invitations, provide testimonials, “show off” the product, give case studies, etc. Passionate customers put new potential customers into the top of the marketing funnel without spending a dime on marketing! Achieving passion is not easy, and often goes beyond the product itself. It is part of what Geoffrey Moore calls the “whole product”.
It might be that a startup provides exceptional support or value in its marketing or sales. Sometimes the user experience with the product is so “delightful”, or has such a deep emotional impact, it results in “passion.” At this point, we’re really talking about the startup’s brand. Some metrics for igniting passionate customers:
—Hypothesize the product functionality required to emotionally impact the customer (If we do x, y, customers will do z.)
—Hypothesize other aspects required to achieve passion. (If we do x, y customers will do z.)
—List specific actions by customers that indicate passion (Customer agrees to be part of a case study, shares product with x number of friends, high net promoter or must have score.)
Establishing marketing metrics: Marketing—especially the buzzword-du-jour, “growth hacking”—is sexy to entrepreneurs and mentoring programs alike. In my opinion, most startups in mentoring programs should be firmly planted in the learning phase and not in the execution phase of marketing. In other words, it’s too early to measure growth. Startups should be running experiments to learn marketing and sales funnel dynamics, as well as the cost and effectiveness of various customer acquisition channels. Moreover, they should be running experiments to disrupt traditional— i.e. yesterday’s—marketing and sales channels.
Early marketing and sales is about learning. But startups really do need to acquire “tranches” of customers in order to recruit them for the customer advisory board, to perform usability testing, and to establish what results in “satisfaction” and “passion.” Acquiring these first customers is a great opportunity to test acquisition channels and buying processes. The actual metrics vary widely by business model, but might include things like:
—Identifying the cost of customer acquisition per channel.
—Describing what it takes to convert customers by price.
—Sales velocity/salesperson
The point of all this is to create a reproducible process for getting revenue that covers the cost of acquiring customers. (This is not the same thing as profitability!)
Pitch training: How to tell a story is more important today than ever before. Each startup must rise above every other startup AND existing businesses in a battle for budget and mindshare. For most startups, IP protection is less important than customer relationships. The depth of the relationship is the only true protection. Storytelling goes beyond product features and benefits, and appeals to the emotional needs of customers, partners and investors. ALL startups need pitch training from coaches who know how to pitch. Preparing startups to pitch investors is the most common objective, but sometimes raising capital is not the startup’s primary need. Still, pitch training is invaluable.
Too Complicated?
The program I’ve outlined here might be difficult to implement and manage. But mentoring is hard, and a mentoring program should be able to meet its own metrics in terms of serving its customers. Investors should expect nothing less, and therefore should approve the management fees needed to make such a system work. Not all organizations can be led by independently wealthy, non-salaried, “retired” entrepreneurs who are just trying to give back.
Most accelerator programs don’t have the success of Techstars and YCombinator due to some lack of quality mentors or passion, but because of a lack of a disciplined process that pushes founders toward success. Ironically, efforts that do not aggressively push entrepreneurs may be creating a class of “needy” entrepreneurs.