I was listening to a partner with 21 years of VC investing experience address my Cornell class yesterday. Eric Young of Canaan Partners pointed out the importance of finding an idea that had "customers responding with a sense of urgency." It occurred to me that it was especially important during a recession.
What does it mean to have "customers responding with a sense of urgency?"
This is what that means to me:
- Customers "get it" immediately. You don't have to explain what you are trying to sell. No education is required. Present and they understand, immediately. Short and sweet.
- Customers want it immediately. This means you have found your "Ideal Customer." That demographic profile of the person with the checkbook who instantly wants what you are offering. That presupposes you have done your homework to create the profile of and then find your Ideal Customer.
- Customers see immediately what is valuable in your offering. They instantly grasp what is special about your product, compared with your competition (including the current way of doing something). You need only to present your value proposition. The customer gets it on the spot.
- Customers see your uniqueness, immediately. They are not confused about what makes you special. They can repeat your claims without coaching.
During a recession, you must stand out and be highly efficient. Your message must have high appeal to the paying customer. Average will not do. Quick is mandatory, time is not on your side.
BOTTOM LINE: CEOs of recession startups need to create products that customers respond to with a high sense of urgency. They eagerly reach for their wallets. Time is not on your side during an economic slowdown. So work it out before launching. Then you'll start booking solid sales immediately. That will bring you a powerful unfair advantage.