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The startup phase of your business is when you must invest in understanding the detailed needs of your customers. This is the time when you’ll have only a small pool of customers, members, clients or users. The plus side of having only a few customers to begin with is that you can invest the time to speak with them directly. However few, these are your early adopters – the most important customers you’ll ever have as they will shape your business more than you might imagine.
‘Starting a business is like being an artist, it’s the handcrafted period of your company.’
The importance of talking to your users or customers on an individual basis cannot be overestimated and has been highlighted time and time again by founders of high-growth businesses. Nor can I overemphasise just how easy it is to get this early feedback.
Early adopters love knowing they are so and love being involved in the development of the business. They love the fact that their opinion and feedback are valued. Yet talking to customers is often overlooked by startups. This is a mistake.
First off, you need to understand why your early adopters love your product: what is making them accept the risk of working with a startup? Second, understand their needs. Ask open questions that start with ‘how’, ‘what’ and ‘why’ and listen to their feedback. Make sure you are open-minded about their responses. You may be surprised by why – and how – some of your customers use your product.
At the humble beginnings of SyndicateRoom, I was the customer support team. And I mean the whole customer support team. If you think you, as the CEO, are above such a task, you should re-consider and see yourself as an entrepreneur instead of a CEO. I did it because it saved on money, which we didn’t have, and it taught me a lot about our customers, which should have been the objective in the first place. Today it is. Even now, with even less ‘free’ time than I had when we were first starting, I periodically read emails that are sent to our customer support – it helps me understand what the pain points are. It’s a valuable learning opportunity.
Recently I took it a step further following the launch of our EIS fund, Fund Twenty8, earlier this year. The fund was the first passive EIS fund on the market; this was something that had never been done before, so I didn’t know how our members would react. So, I sent an email to all our Fund Twenty8 investors (over 200 of them) asking for their feedback and giving them the option to book calls directly into my diary. The resulting catch-ups took me over 50 hours on the phone in total. Whilst we are no longer a startup, Fund Twenty8 itself is, and the feedback from the early adopters was truly remarkably helpful. Their comments have helped define the product roadmap for years to come.
As you grow you will lose the luxury of keeping in such close contact with a meaningful percentage of your users. As you scale, you need a more analytical mindset. It becomes more about exploring how small improvements may have a large impact on your business. In many ways it is easier than the early days. You may already have significant web traffic that allows you to quickly do A/B testing. The changes are more incremental and their impact is large due to the number of customers already in existence.
The most meaningful innovations happen during the early days of a startup, which is why you need to keep an open mind for early feedback and be ready to adapt your product accordingly. It also becomes harder to make bigger leaps when you grow due to legacy throughout the company – customers tend to react poorly to big changes to the product or service they are used to.
Focusing on scaling up during the startup phase is the wrong approach. In the early days, you must ensure that your company remains nimble and able to make huge leaps in terms of product and service. Doing small things like talking directly to your customers may not be scalable, but it certainly is invaluable in the early days. You will have plenty of time to focus on scaling up later on in your journey.
