Mattering to customers, to investors, to anyone who engages with your brand.
Language is everything. Like a first impression, you don’t get a second chance to create meaning with potential investors or customers. In 30 seconds or less, you must convince them that you are different from your competition, needed in the market and that you’re the right team to do it. You must know why you exist and why your existence matters now. As Carol Cone, a cause marketing guru and Founder of ON PURPOSE, puts it: “You have to be a brand that matters.” Mattering isn’t about selling a product or service. Mattering means caring about things that will really create change for your customers and for the planet. As a clean-tech startup, mattering is easier for you; mission is embedded into your DNA. Pitching your value comes down to knowing how to communicate why your mission matters.
Here are four know-hows as you develop and pitch your value proposition:
1. Pitch a business. Not a product.
Yes. Your products matter, but products change. The reason your business exists probably won’t. Secondly, products don’t raise capital investment. Companies do. You need to be clear on both the value proposition of your company and your products with the primary focus on who your company is. This is important for two reasons; first, it helps your customers identify whether what you are selling is something they need. Secondly, it helps investors pinpoint whether your business fits within their portfolio. Customers and investors will make split second decisions about you, your company and your products. A simple value proposition statement ensures an ease of understating of who you are, why you exist and what sets your company apart.
2. Know why the world needs you.
Without you, the world suffers. Why? Because there is no other company like yours. As an early stage company you must be clear about why you’re different, but more importantly why these differences matter. If your company is entering a crowded market, be bold about what makes you better than the competition. If you are entering an immature market, convince your customers and investors that what you have is worth their money and reputation. You need to give your stakeholders a reason to believe that the world needs you.
3. Know how you fit in your target marketplace.
A company's value proposition clarifies what makes you attractive to potential customers and/or investors. It is based on the "need or friction" the company's products or services address in the world. Talk to your market. Validate that your target market needs what you are selling; one customer with one proof of concept is not enough. This is called Product Management. There is no point in building anything if customers are not prepared to pay for it. An open feedback loop with your market will help you to understand what is valued, what makes your proposition unique and how to communicate it in language they understand.
4. Help investors ‘ring the bell’
There can be a lot of pressure in the pitching process, but don’t let this intimidate you. The pitch is a small part of the work needed to engage with the right investors. Companies succeed in securing investment when they have a clear and documented business plan, understand the investment needed to hit key revenue milestones and have a prioritized sales pipeline to get there.
One investor we work with describes this as “ringing the bell,” i.e., “you tell me how much you need, what you will achieve with that money and the growth path you will take to create the return on investment I need. Then I’ll ring the bell.”
Communicating your value proposition in one or two lines isn’t something you pull out of thin air. There is a huge amount of research an early stage company needs to undertake to ensure that it becomes attractive to the right investors with the right financial instruments available to support its pathway to growth. We know you’ve been working hard to create a business and a product that is built to last. We’d love to support you in making that happen. We created a one-of-a kind tool called the kibikibi Partners Investment Pack which synthesizes all you need to know to build the robust business plan you will need to raise capital. Our goal is that you build and grow a company that matters. The world needs you. It’s time you tell them why.