How I got my first customers without having a product

People often ask me what they need to do to get funding. I always give the same answer: sell your product, without having the product. It’s the only way to really prove your idea is worth an investment, and it’s a great way for yourself to find out *if* your idea is worth your investment.

I realize it’s not easy. I’ve done it, and at times it was a frustrating experience. On the other hand, it taught me a lot about my target audience, pricing model and product. For free. That’s why I would like to share how I’ve done it. Not as a “six-step-program-to-get-a-customer”. But to inspire*, and to have you hack your own way towards that first magical customer.

Storefront_results

My first step, week one: the storefront

A simple landing page, stating our value proposition and a form to subscribe to our mailingslist.

Objectives:

  • Test my value proposition (Am I solving a problem people care about?)
  • Get e-mail addresses (Who cares about the problem I’m solving?)

Tools:

  • Launchrock.com
  • Mailchimp.com
  • My Twitter account

landingpage2

Invalid excuses:

  • “I first need a logo to launch that page.”
  • “Maybe I should start a blog, get a corporate twitter account, gain more followers and then launch my launchrock page.”
  • “I first need a domain to launch this page.”
  • “I need a copywriter/designer/developer/online marketeer to launch this page the way it should be launched.”

The results:

  • 1700 pageviews
  • 335 subscribers (17,5%)

I was hoping for a 15% conversion ratio to validate the problem I was solving, so the 17,5% was a modest confirmation of my value proposition. 60% of the subscribers were from advertising agencies, 30% were clients and 10% were students or press.

What I did wrong:

  • If you look closely at my storefront page, you can see I actually had 3 value propositions: “more insights, less KPI’s”, “Social media ROI, finally” and “Darwin will show you the impact of social media on your sales funnel”. It cost me a lot of effort later on to find out which proposition triggered the subscriptions.

My second step, weeks 2 to 6: the meetings

The hardest part. I e-mailed the 330 people on the list asking for a meeting to discuss the problem and pitch my idea. After a lot of reminders and follow-up calls, I was able to score 25 meetings.

Objectives:

  • Find out why people responded to the storefront.
  • Get feedback on the solution we wanted to build.
  • Get a € 4.800 commitment to try the product for  a year and be a part of the advisory board.

Tools:

  • Keynote
  • Survey questions to ask during the meeting
  • Wireframe to illustrate what solution we wanted to build
  • Highrise CRM to facilitate the follow-up

Invalid excuses:

  • “I can’t draw a wireframe”
  • “No one wants a meeting with me”
  • “I’m not that good in making up survey questions”
  • “My slidedeck won’t be pretty enough”
  • “I haven’t really settled on pricing”

These are the survey questions I came up with:

These are the slides I used to demonstrate our solution:

The results:

  • 25 meetings & responses to my survey
  • Survey quotes I could use on our website to build trust with prospects
  • 4 paying customers

The 25 respondents were kind enough to give me honest and sometimes harsh feedback. It turned out I was wrong about many assumptions I made concerning the product. (I was convinced it had to look like a funnel. Everyone disagreed.) I also noticed people didn’t lack data. They just didn’t know what to do with it, or how to get the insights they were looking for from that data. This was an insight we could build on.

The people who signed up as customers were a direct or indirect part of my network. People who had no connection with me whatsoever lacked the trust to sign on in this early stage. I added a task in our CRM to follow-up with them in a few months. Some of them signed on when we had something more than a few wireframes.

What I did wrong:

  • I was talking/selling way too much in the first meetings. It took me some time to switch into ‘listening’ mode. The survey questions were a way to force myself to shut up.
  • My survey questions were very biased. It was almost impossible for someone to give a wrong answer.
  • I tried to get quantitative results from these surveys, but this was impossible given the limited amount. The fact that I was talking to my target audience proved to be more important than the tools I used to talk to them.

My third step, week seven: having a product without having a product

Objectives:

  • Gather product feedback from our first four customers
  • Refine our sales process: use the logo of our first customers and a first case study to build more trust

The tools:

  • Two freelance developers for one week
  • Myself, the copy-paste monkey

I hustled my way to four sales. Only one problem: there was no product for the customers to use. Two freelancers were going to build the first version of the product, which would automatically collect data from API’s (Facebook, Google Analytics, Twitter, Adwords, …), process that data, and visualize it on a dashboard. The problem was it would take them 12 weeks to build, and I only had one week.

In what I remember as a creative but sweaty meeting, we decided to scrap everything that wasn’t absolutely necessary. The end-result was pretty down-to earth: the front-end worked like it had to, but the entire back-end was replaced by me, the copy paste monkey. I would wake up every morning, log in to every analytics account of our customers, and copy paste their data manually into Darwin Analytics. By the time our customers woke up, they could log into Darwin Analytics, and have all the data they needed.

copypaste

It’s safe to say this way of working was not scalable. But it’s not like people were banging on our doors screaming for Darwin Analytics.

Invalid excuses:

  • “I can’t even pay those two freelance developers for one week!”
  • “The first version of my product can’t be build in one week. Im-possible.”

The results:

  • Four customers who signed up before the product existed, and gave very helpful feedback on the first version of our product in a customer advisory board.
  • Logo’s we could use in our revamped sales presentation, to build trust with prospects.
  • Time to prepare a seed-investment

What I did wrong:

  • I wasn’t measuring how clients were using the product, this could’ve taught me a lot
  • The people on my advisory board were busy, which made it harder to get them in a meeting. If I were a better scheduler, I could have gotten more feedback meetings.

And now…

After the first four customers we got a seed investment (200k) and some government funding (50k) for the research we are doing. 3 people are working for Darwin Analytics full-time, and we are looking for two more to join us. At the time of writing, we have 11 clients using the product. Some of them have become true Darwin Analytics fans, which makes working on the product even more fulfilling.

Our test-driven approach remains one of the things that defines us most. Right now we’re testing our marketing with paid advertising and different landing pages, and we’re using usage data from clients to change our product. I’ll write more about this later.

If there are some general rules I would share with you after these first few months, these would be it:

  • Eliminate dependencies. “I have to do x before I can do Y” is just an excuse not to get started.
  • Don’t be scalable. Surely mailbox had a lot of traction before they got started. You’re not mailbox.
  • “Sales cure all.” & “Always be selling” – I didn’t invent these, doesn’t make them any less true.
  • Prepare for a marathon, not a sprint. A quick silicon valley exit probably won’t be for you. Build a business that can outlast you.
  • Know your runway. You can experiment all you want, but make sure that you know how much cash & runway you have left.

*A lot of people  deserve credit for being an inspiration. Check them out at the Darwin Analytics karma page.

I love feedback and fresh ideas. Go nuts in the comments:

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41 responses to “How I got my first customers without having a product

  1. Schitterende post Anthony! Herken mezelf er ook wel in hier en daar :-)

  2. Filip De Pillecyn

    Fantastic and very inspirational post Anthony. Respect!

  3. Very interesting read Anthony!
    Like the way you ‘hacked’ your way into creating a product.
    Basics first, even with manual actions.

  4. Kurt Deneire

    Hey Anthony. Welke inspanning heb je geleverd om die 1700 pageviews te krijgen? En in welke tijdsspanne was dit?

    • Hi Kurt, I mainly used my own Twitter account and blog to drive traffic to the page. Launchrock also has some built-in features to stimulate WOM.
      It took me about 6 weeks to get these results.

      Let me know if you have any more questions, love to help you out.

  5. I smiled more than a few times reading your post. Your tips are spot on. The “copy paste monkey” comment really cracked me up. I remember a friend in the early ’90ies who was selling financial consolidation software that wasn’t ready yet. So he offered to first-time customers that the entire consolidation process would be done for free by his company. Little did they know that the consolidation was done manually in Excel and then given the desired look and feel in a nice report. By the next quarter, the software was ready and bugfree and my friend on his way to become very wealthy (the company was later sold to a US giant) :-)

  6. “It’s safe to say this way of working was not scalable.” hilarious.

    Really nice post, Anthony. Incredible to see the pace at which things have changed over the past months. And also nice to see that this is just really dirty work. Like anything you want to build from the ground up: there are no shortcuts to success. Keep up the good work!

    • As dirty as any other job, I guess. The question is: which job is so awesome to you that the dirty work feels like playing?
      I’m planning a next post about the ‘past months’ you refer to. Hope you’ll be reading that one too!

  7. This post made my smile, that’s why I comment. Great writeup of a startup story that includes some bluffing all the way up. :)

    Added you to my reading list.

    • Hey Pieter,

      Thanks a lot for your comment.

      Honestly, I wouldn’t call what we did bluffing: We were as radically transparant to our customers as I am in my blogpost. Every customer knew there was no product, and that there was a copy paste monkey behind the first version. I don’t think we would have been able to keep those four customers if they didn’t know about our way of working from the beginning. (quite rightly so)

      Thanks for adding me to your reading list, I take that as a very nice compliment.

      Cheers,
      anthony

  8. TVD

    I like the way you think. I believe the best lesson from this article was our ability to answer the question, “How do I know my idea will work?” A good answer is build for existing markets. A better answer is test if that market exists at all. Lo and behold, you did that – Splendid!

    • Hello and congrats Anthony.
      You must be totally psyched to have pulled this off.
      Question 1: Any reason for using a base of 7 for the survey rather than the usual nps 10.
      Question 2: Did you find any apps that would help you solve the scheduling issues since writing this post? In a past project i used Tungle.me, but it seems that is now defunkt.
      Craig

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  15. Great post Anthony, very inspirational!

    Alltough this all seems very nice and excited and except for the mistakes you mentioned in the article, there must have been dark and stressy days to, no? Where you would cry in the corner of your room hoping for a miracle? Could you maybe share one of those?

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  18. Thank you man, I’ve tried starting a business and failed, this will help me so much form the next time. I really appreciate you shared this.

  19. MF

    Thanks for writing this up! One important detail: How exactly did you generate the 1700 pageviews?

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  22. kar

    Very inspiring! Thanks for sharing, very helpful for what am planning to start.

  23. Julian

    As an aspiring entrepreneur this was really insightful. Getting your personal account on the MVP model was really interesting and the step-by-step on what to expect and pitfalls was really useful. I wish you the best of luck on Darwin!

  24. Frank

    Cool post Anthony! Would be interested in a blogpost regarding the process of getting your seed investment as well ( ‘After the first four customers we got a seed investment (200k) and some government funding (50k)’ ). What did you realize and learn along that way, just as you described your customer development process and first steps towards your initial product.

  25. Great post Anthony! Thanks! Won’t this bring me out of the stealth mode and invite competition even before the product is launched..just curious..

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  27. After a Startup Weekend, I’m seeing that I need to learn more about landing pages and this type of validation strategy. Thank you for your post.

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