Six things to consider while crafting your go-to-market strategy
Getting a go-to-market strategy right is key for all founders. With this article, I aim to reinforce six important aspects before crafting one. By doing so, I hope to support impact founders in adjusting their initial steps to fulfil their impact ambition.
In the last few years, it became clear and almost a mainstream concept that social and environmental challenges are great opportunities to be fostered through the approach of a business venture. In 2022 impact companies represented 15% of the broader European tech market (Atomico 2022), and as such, both impact and mainstream VCs are increasingly attentive to the opportunity impact presents.
At MAZE, we have been supporting early-stage impact startups to develop and grow. Despite the level of knowledge and content available out there, many early-stage founders struggle with their go-to-market strategy, which ends up having a structural negative impact on their future journey. Here are six aspects to consider before crafting your go-to-market strategy:
1. Become an expert on the problem and market you care about
Not all founders have previous expertise working with the problem or industry they are tackling, nor do they need it. In certain contexts, it may help in your differentiation. In others, it may benefit from entering as an outsider with a fresh and unbiased perspective. Regardless of your situation, by the time you develop your company, you must become obsessed and a real expert about the problem you are tackling and the market you are entering.
Before you start developing a product, you must know the ins and outs of the industry, understand the current incentives in place and the psychology (the needs, the pains and the motivations) of the key stakeholders playing a part in it.
Immersing yourself in such context and going above and beyond the initial superficial bias, both as an insider and outsider, is essential to develop a solution that adds real value, and that may offer a feasible alternative to the market stakeholders – especially users and payers.
In addition, and focusing on the reality of an impact founder, your company journey will require you to become an ambassador in raising awareness for the dimension and importance of the problem you are fighting for, so deep insights are essential to promote credible interactions and gain the confidence of those you need to get onboard.
2. Apply a culture of user-centric design
When starting to develop the MVP and investing further in product development, many founders make the mistake of taking certain assumptions for granted without adequately validating them. The results tend to be months of work and resources invested and a product that is not actually appealing to clients or aligned with their ability and/or willingness to pay. Of all mistakes a founder can make, I dare to say that not taking a user-centric approach is the most common and a very expensive one, from which neither the founders who have raised and spent millions are sparred from.
An example of a company that adopts this methodology strategically is Fair Phone, which uses as one of the sources of information their forum to continuously and actively hear, question and engage with their customers when developing and testing new features – especially important given the disruptive approach that their company has in the market.
Applying a culture of user-centric design is crucial in developing a successful product as it helps prioritize the real needs and wants of the end user. By understanding and catering to the user, the product is more likely to meet their requirements and drive customer satisfaction. This leads to increased user adoption, positive word-of-mouth, and better business outcomes.
Ultimately, a user-centric design allows teams to be focused on delivering deep and sustainable value when developing a product and prevents them from falling into the trap of dispersing in the development of several features and services ahead of time and without a robust rationale behind it.
Such an approach may also signal and support a company to pivot its model earlier rather than later, saving considerable amounts of resources that would be wasted otherwise. It is no coincidence that in successful companies, founders prioritise and ensure close contact in customer service activities until product-market fit is reached.
3. Define a simple and strong value proposition
In entrepreneurship, less is more, especially when we talk about early-stage companies disrupting the status quo of certain markets. There is a tendency for some to develop a rich and complex value proposition aimed at showing novelty and extra value. The issue is: complex value propositions fail at conveying the messaging of your disruptive approach and often make the path of developing the company much more difficult since the founders are tempted to give the same level of importance to several elements of their product during their development journey. To differentiate from competitors and appeal to potential customers, a clear value proposition is essential. It may take a long number of iterations to get it right, but aiming at that is worth the effort.
4. Understand who your users and your payers are and pitch accordingly
More often than not, startups adopt B2B or B2B2C business models during their early stages as a way of prioritising financial sustainability and more rapid growth. In those cases, especially, founders tend to be faced with the challenges of having to deal with and balance two important stakeholders: the users of their product and the payers for such service.
It is hard to say who is the most important – users are essential for product building and providing traction and impact numbers that attract both payers and investors. Payers are essential to reach a wider pool of users and to validate the market feasibility of the product from a business model point of view, which investors often ask for.
For B2B and B2B2C models, addressing each individually by adapting your pitch and approach is important at the start of a company’s life since the sustainable success of a company depends on both stakeholders feeling attracted by your offer and feeling effectively served and satisfied.
5. Define the most important metrics to lead your growth and monitor them closely
Metrics tracking and reporting are fundamental to all companies. Some may argue it gets more relevant after a certain level of development, which is at least a debatable statement. Founders who prioritise the definition and measurement of key business metrics from the get-go and who iterate on such metrics as the business develops tend to be more successful and develop stronger trust relationships with stakeholders, such as investors or potential investors.
Besides the discipline to track and report on general business and impact metrics, founders should invest in defining a North Star and working towards it. The North Star Metric is the single metric that best captures the core value that your product delivers to customers. Optimizing your efforts to grow this metric is key to driving sustainable growth across your full customer base (source: growth hackers).
6. Start monetising as early as possible
In times when tech speculation is being reviewed and adjusted for, we are reminded that revenue generation is a relevant element to consider from day one – and increasingly valued by investors. Some founders tend to prioritise new users and frequency of use at the cost of validating willingness to pay and revenue generation. This is often a mistake and has cost the lives of many startups.
While defining the right pricing is not always easy, the MVP stage is a great opportunity to include it as a hypothesis to be tested and answered for. Remember that real willingness to pay is not validated by asking users how they feel about a certain price. Instead, it is about converting users into regular payers.
I would love to hear your thoughts on go-to-market strategies and how you have applied them. If you are the founder of an early-stage impact venture and are looking for pre-seed investment and a partner who can support you in your journey, reach out to me at firstname.lastname@example.org or sign-up below, and we will contact you later.