Lesson 2 of 7
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Overview for “Acquire Your Customers” (Q06)

When you generate your first revenue, take a moment to celebrate. That’s an amazing accomplishment that a large fraction of startups never attain.

But that first sale is just the beginning. You have to sell a lot of product to a lot of customers, keep them happy, hire more employees, keep them happy, and reduce your cost of goods sold as volume goes up. And if your product is tangible, you also have to manufacture it and manage the supply chain.

None of these tasks are easy and none of them ever goes away for the life of your company.

Fortunately, a business model that suits your value proposition has likely been developed and thoroughly tested for many years in the real world, often by your competitors. Take advantage of your research into them (see Question 03) and apply their successful strategies to your company while avoiding their mistakes.

Answer Q06 to “Acquire Your Customers”

  • Question 06 of the 10 Questions is “How will you make money?
    • …you…” refers to your organization.
    • How will you make money?” refers to your wholistic business model: how you market, sell, make, distribute, and service your products and services.

Business Context for “Acquire Your Customers”

  • Business model: Know your value chain and how you will manage it.
  • Customer acquisition: Leverage smart channels for identifying, attracting, and retaining customers.
  • Scalability: Know your market segments, pricing and costs to support your strategy to scale.

Note: for more details, go to Business Context for “Acquire Your Customers”

Fear & Greed for “Acquire Your Customers”

Unless your business model is your innovation, your pitch about your business model should mostly focus on reducing fear:

  • Fear: You seem to assume that if you build a better mousetrap, customers will find you.
  • Greed (investor perspective): You have identified a smart business model that supports scaling with time.
  • Greed (customer perspective): Your innovation will improve my business model (new products, new markets, lower costs, etc.).

Note: for more details, go to Fear & Greed for “Acquire Your Customers”

Do’s & Don’ts to “Acquire Your Customers”

  • Do describe your value chain from suppliers to end users, as well as influencers in your ecosystem.
  • Do understand how to acquire customers efficiently and keep track of the cost of doing so.
  • Do identify partners, distributors and other channels that will help you scale your business.
  • Don’t try to serve too many markets with too many products in parallel.
  • Don’t focus too much attention in your pitch on acquiring and serving your beachhead customers unless they are highly scalable.

Business model

  • Identify critical parts of the value chain: high-risk suppliers (if you are creating a tangible product), channel partners, decision makers (customers), and end users.
  • Keep in mind: influencers and gatekeepers, the risk/reward balance between outsourcing production and protecting it in house, etc.

Customer acquisition

  • Direct sales: Viable for sales to early adopters or very big ticket items (e.g., airplanes) or to government (military)/ infrastructure (utilities) customers.
  • “Intel Inside” & other partnerships: Contract with or license to your partner to do most of the selling while you supply core technology.
  • Distributors: Contract with established companies to raise visibility with a very large number of customers rapidly.


  • For scaling in terms of units: think in terms of timing, channel partners and market segments.
  • For scaling in terms of financial projections, see course 09, “Know Your Numbers

Note: for more details, go to Do’s & Don’ts for “Acquire Your Customers”

Tips & Tools to “Acquire Your Customers”

  • Use a (relatively) simple graphic to organize & illustrate your business model: a flow chart, the Business Model Canvas, or any other tool that works for you.
  • To reflect scalability, include time frames that you plan to enter different market segments.

Note: for more details, go to Tips & Tools for “Acquire Your Customers”

Consistency ⇒ Credibility for “Acquire Your Customers”

  • Question 01: Consistency between bottom-up and top-down market analyses for a significant market pain
  • Question 02: Consistency between the problem (Q01) and your innovative solution (Q02)
  • Question 03: Consistency between the specific problem (Q01) and your competitive advantage in terms of customer benefits (Q03)
  • Question 04: Consistency between the customers’ business model (Q01) and your barriers to entry against competition (Q04)
  • Question 05: Consistency among the promise of your innovation (Q01, Q02, Q03) and your demonstration of meeting the customers’ needs & wants (Q05)
  • Question 06: Consistency among the customers’ needs & wants (Q01), your products (Q02), your sustainable competitive advantage (Q03, Q04) and your ability to deliver your solution efficiently (Q06)

This Question switches your pitch focus from your innovation onto the business, from the great solution to an important problem to an opportunity to reach a large number of people who want your innovation enough to pay money for it.

  • Dedicated slide: Show your strategy.
    • Highlight your scalable and cost-effective approach to reaching customers, with emphasis on the big opportunities you will access once you have been successful in your beachhead market.
    • Indicate specific partners and customers that you already have or mention categories if you are still building those relationships.
    • Include time frames for entering each market segment.
  • Add to other slides: The business model virtually always requires a dedicated slide. Portions of it may be included in others, e.g., existing partnerships may be noted in Q05 and pricing models may be presented as part of Q07.

Note: for more details, go to Consistency → Credibility for “Acquire Your Customers”


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