When to say “Uncle”

sales pitch enough

How Many Customers = “Enough??”

 

The sad truth is that you’ll never know the answer to this question…and, to be honest, the answer to “how many customers do we need to talk to” is about the same as the Supreme Court definition of pornography…”you’ll know it when you see it.”

Two quick anecdotes tell the tale:

Tale One:

Four customers is occasionally enough! 

One startup team I worked with in the warehouse automation industry made a grand total of four customer discovery calls and called me saying, “Professor, what do we do now? 

You told us to talk to 50 customers and we’ve heard exactly the same thing four times in a row…everybody just wants to give us an order!”

Life doesn’t get any better than that.

And while four customer does not a trend make, it’s certainly time for entrepreneurship to take over and for customer discovery to take a back seat, at least for the moment…sign those customers up, get their money, make them ecstatically happy, and learn about your value proposition, product or service features, and customer segment in the process—all while earning actual revenue! 

In this case, the first four customers provided conclusive evidence of product/market fit, and the company continues growing and prospering two years later.

Tale two:

Fifty customers is nowhere near enough: 

“We’ve talked to just about 50 customers, and about 8% of them say they’re very excited about our value proposition. 

22% say this, and 37% say that… .  But what do we do…there’s no clear common theme to the feedback.”

Sounds like trouble to me. Why?

  • Verbal enthusiasm is not the same as measurable enthusiasm.

None of the 12 enthusiastic customers offered a purchase order or credit card, and the level of enthusiasm is hardly enough to build a business around.  

So 50 interviews don’t seem to be enough in this case—there’s no clear learning so far.

  • Early customer discovery should generate more enthusiasm, more passion about your value proposition than “8% very excited,” especially since the 8% is likely on the high side and it’ll certainly decrease when you ask those customers for money.

Back to the drawing board…

Next page- So what’s a startup to do? 4 Insights

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About the author

Bob Dorf

Bob Dorf is among the world’s leading Lean Startup and Customer Development experts, who trains and coaches startups throughout the world, with a particular focus on Latin America.  Bob co-authored the Startup Owner’s Manual, a global bestseller, with startup legend Steve Blank. Now in 18 languages, the Manual details every step in transforming an idea into a repeatable, scalable, profitable business. Bob focuses particularly on training programs for the startup educators, coaches, and investors, and has done so repeatedly in Mexico, Colombia, Brazil and many more. Hes also an Entrepreneur-in-Residence at Columbia Business School. Earlier, Bob founded seven startups--“two homeruns, two base hits, and three tax losses.” His 30+ angel investments delivered 7 IPO’s and six disasters. Learn more at www.bobdorf.nyc or contact bob via bobdorf@gmail.com

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