Success is meeting a customer’s need. Too many think of success as having money, but that’s not true success. True success is having a product that meets customers needs, and a proven method for customers to pay for and consume that product.
So why do so many feel that their idea or business model is only valuable if they have raised money? Why put so much stock into what investors think about you, your business, or your product?
Consider these interesting points:
- Investors are not usually experts in your industry. They don’t know everything, and they certainly can’t read your customer’s mind to tell you what they’ll be willing to pay for.
- Investors choose not to invest for any number of reasons. They may be having a bad day; you may have knocked at their door instead of being introduced by a trusted source; they may not have deployable capital at that moment; maybe they just don’t understand your business model. Whatever the reason is, it’s not a good enough reason for you to feel that you can’t be successful.
- Investors don’t always choose to invest in the next big idea. In fact, it is a commonly held statistic that on average 9 out of 10 investments are failures. Furthermore, a venture capital firm, Bessemer Venture Partners, published a report naming their “anti-portfolio,” or a list of deals that they decided to pass on. That list included great innovators such as Apple, eBay, and Netflix.
- Investors will not buy your product. They want you to sell your product. So go find some customers to whom you can sell, pre-sell, interview, or survey. Obtain customer feedback and you’re on your way to success.
Raising capital is not meeting your customer’s needs. Raising $500,000 does not guarantee success. In fact, consider the potential tradeoff: you may spend the same amount of time acquiring $10,000 in customer subscription revenue as you would raising $500,000 in investment capital with no customer revenue by the time you’re finished. Which to you would hold a higher chance of success?
Customer validation is at the heart of success—keep your eye on the prize, and success will come.