Back from a bout of flu during which I was reading and thinking a lot. Periods of sickness generate perspective, give you time to contemplate priorities in life and what is important.
As I reflected on startups that have shut down recently and compared them to others that are thriving, one pattern became clear: The thriving enterprises had created reasons for customers to be compelled to make the purchase.
That "compelling reason to buy" turns out to be a lot more than "way cool" or "clever" or "I like the pink one."
It is about something complex that is triggered in the soul of the customer when she sees what is offered by your company.
It is emotional, a lot of emotions in fact.
It is not a list of more features than your rivals.
It is not about being faster or quicker or better or cheaper.
It is about "Wow!"
When you get a "Wow!" reaction from customer after customer who sees your product or service offering, you've got it. And them. The customers are hooked and propelled to buy. Your business has shifted from selling to filling orders.
That is where you must aim your enterprise: to figure out what is compelling compared with the alternatives your customer has in front of him.
That will differentiate your business from competitors. It will start your branding. It will become the envy of your competitors. They will complain that you have an "unfair advantage".
First startup to figure that out wins the gorilla share of market (30% and the game is over). It is not about "first mover advantage." It is about "first to get it right wins."
Research in Motion delivered a solution for continuous email communication (Blackberry).
Apple delivered a solution for affordable song by song purchase and playback (iPad).
Both were late to their competitive battles, both became gorillas of new market categories.
Google, a startup, delivered a superior search solution, after others had pioneered before them.
Yahoo was first to get it right as a startup in delivering the Internet portal that now dominates.
Investors today look for this compelling reason to buy in every startup idea they see. Don't show up without it.
BOTTOM LINE: I find investors today especially sensitive to "why will the dog eat the dog food, eagerly?" You are going to have to have some proof. It may be in a beta test, surveys, demos, whatever, but in any case you have to have it. The customer must be instantly excited when they see your offering. They have to say "Wow!" immediately. That is now central to becoming a gorilla of your new market. It is fundamental to building an unfair competitive advantage.