See Other Entrepreneurs as Hot Prospects

On your first day in business, you may think, “Wow. We are the newest business in the world. Every other business has a head start on us.” That may be true for about two seconds. According to the U.S. Small Business Administration, 1,569 businesses start every day. By the time you complete your first week in business, nearly 11 thousand businesses will be younger than yours. That’s 11,000 businesses trying to reel in their first customers, too. By the time you complete your first year, more than a half million companies, most of them tiny, one- or two-person operations, will be newer than yours.

Somewhere in the half million or so new businesses may be the perfect first customer for you. Think about it. If another entrepreneur thinks her newness should not prevent anyone from doing business with her, why shouldn't she be eager to do business with another startup? Nobody can empathize with you more than another new company, whose founder understands all too well what it’s like to be small and desperately seeking paying customers.

If you call on any young company, the introductory call should be easier than most. “I’m Ernie Entrepreneur with Ernie’s Hi-Tech Denture Technologies. We’re a new company, too, and we may have a solution for your…” You will find instant empathy and, perhaps, an instant prospect.

Something else those companies have in common with you is a tight budget. Maybe they can't afford what you ‘re selling. Maybe—probably—you can’t afford what they’re selling either. Perhaps then, each of you could benefit from what the other has without spending your meager funds. Therefore, you can work a trade. You quickly line up a customer—one with a special understanding of your newness and customer void—who can also provide you something you need but cannot afford. Voila. You both get your first customer.

Here's a partial list of services provided by potential trade partners that might otherwise be luxuries in your early days:
· Professional marketing advice
· Advertising services such as business cards and brochures
· Computer networking and security
· Software development
· Web design
· Cleaning services
· Sales consulting
· Clerical Services
· Accounting
· Legal advice
· Office and conference space

If your trade partner has very few customers yet, you can bet she will be eager to act as your reference, provided you reciprocate. Also, it is another form of networking. Her prospects, which call you seeking a reference, can also be good prospects for you. Your prospects can be good prospects for them. You both have a lot at stake, and a lot to benefit from working together.

Even companies that are a couple years old are still new, still a startup. (Look back two years from now and see if you don’t still think of yourself as a babe in the woods.) Such near-new companies will still have a fresh understanding of what it’s like to land the virgin customer. They can lend a sympathetic ear, too. But they may also have something even nicer: money. You get the nice combination an understanding prospect and a check that won’t bounce.

Be a Know-it-all

We've all heard these claims in business:

“We’re number one.”

“We’re world-class.”

“We’re the experts.”

Any company that claims it's world class, isn't. If you want to convince someone that you’re the best, the worst thing you could do is to tell them so. Instead, help them discover it for themselves. That’s especially true if you’re trying to get your first customer. Who would believe you if you say you’re the best when you have no customers, yet? Even if you have a track record, people would be leery if you bragged about your greatness. Prospects want to choose a company that knows what it’s doing. But you won’t convince them by simply saying, “I know what I’m doing.”

There’s a better way.

Let’s say that after years of experimenting in her kitchen, Lucinda has developed a great-tasting salsa with a special main ingredient: lima beans. She immediately forms Sublima Lima Salsa, LLC. If Lucinda opened a small store on the busiest street in town, she might sell one or two jars of salsa a week. Her goal is to sign up wholesale customers. Not only does Lucinda have to overcome the stigma of people who associate lima beans with school cafeteria lunches, she’s never sold anything in her life. Therefore, she has to convince potential customers that lima beans really are a tasty salsa ingredient, and that she’s the expert on such things.

Lucinda sets to work by submitting an opinion piece to her local newspaper entitled Lima Beans, the Misunderstood Legume. Then she learns that the local community college is always looking for experts to teach non-credit continuing education classes. Lucinda proposes to teach a cooking class that shows students how to use ordinary vegetables for easy, unique entrees and side dishes. Her students quickly see that she knows what’s she's doing around a bean or two. On the last night of class, she gives each student a jar of her Sublima Lima salsa.

Lucinda is just getting started. She joins civic organizations and offers to speak at any opportunity about the positive health aspects of lima beans. And then she signs up for as many neighborhood and community festivals as possible where she hands out brochures on healthy eating, along with free samples of her salsa.

Eventually, Lucinda’s efforts begin to pay off. A retired teacher takes her cooking class at the college. The teacher happens to be the mother of the owner of a chain of gourmet grocery stores in town. He sees the jar of salsa in his mom’s kitchen one day and tries it. Impressed, the storeowner sees Lucinda’s contact information prominently displayed on the label, and he soon calls her to learn more about her company.

The administrator of a large nursing home facility hears Lucinda speak at a Rotary Club lunch. The administrator is always interested in new ways to provide healthy meals to her residents. After the speech, she corners Lucinda to learn more.

Lucinda begins to build her list of prospects—prospects that see her as an expert not just on lima bean salsa, but all things vegetable or legume-related. Who knows? Lucinda’s prospects may need a product other than salsa, or maybe something vegetable-based that does not include lima beans. However, they are confident that Lucinda is the expert on such matters because she’s demonstrated that fact in many settings, all without directly claiming that she is the best at what she does.

Take their advice

You can even semi-formalize your relationship with your early advisers. Consider putting together an advisory board filled with people who have already reached the goals that you aspire to, even if they don’t have the potential to become customers. If you can’t connect with the right people with expertise in your industry, seek out wise folks with business expertise in other areas, or a solid image in general. Maybe a senior manager with the company you just left would be interested in serving on your board. After all, your success will reflect favorably on her.

Tell your advisers what you expect from them and how much (actually, how little) of their time you’ll require. Never waste their time. Hold meetings regularly, perhaps over lunch, but infrequently. When the money starts rolling in, you can be more elaborate, if you want, by taking your advisers on a weekend getaway. But don’t pay them. You want objective advice. You want people who will tell you what you need to know, not necessarily what they think you want to hear. You want them to be unencumbered by the promise of stock options or other biases.

Types of practical advice to seek from your advisers:
- How logical is your business plan
- How best to approach others in your industry
- Thoughts on how long sales cycle is likely to be (from the time of your first appointment with
the prospect to the sale)
- Realistic expectations for generating customers
- Examples of what worked for your advisers when they started in business

Your objective with the advisory board, besides the priceless advice, is to establish in future prospects’ minds that you’re receiving regular input from reputable business minds. The idea that a bevy of well-known decision makers is willing to take the time to advise you on a recurring basis will mean a lot to your prospects. They will know that your adviser’s time is a powerful investment in you.

You can tell your prospects, for example, that even though you don’t have the level of experience enjoyed by your competitors, you receive advice from those who do. The time your advisers spend as your sounding board will engender peace of mind with your first prospects almost as much as a long list of customers.

Your advisers should help you willingly because they believe your success will increase the success of your industry or the business climate in general. Who knows? Some of them may become your customers. It wouldn’t be the first time such a thing happened. But that shouldn’t be the main reason you form a board.

You don’t have to have a Fortune 500 executive on your advisory board. Heck, you don’t even have to have an advisory board. You can ask one or two people to serve as senior advisers. When they agree, immediately put their names prominently on your web site, letterhead or other marketing materials. As long as your advisers
1) will increase the level confidence among your prospective customers and
2) can offer objective advice, nobody should be off limits as a potential advisory board member.

Compelling Reason #2: Your First Customer

Because I lack the ability to see into the future, I can tell you little about your first customer, except this: She is no dummy. Let’s say you are introducing the shiny new ultra-sleek TrashSmasher 3000, which competes directly with the well-known but less-sophisticated TrashCrumpler made by Humongous Conglomerate, Incorporated (popularly known as Humco, Inc.). Your first customer knows you will treat her as though she is the only customer in the world, because that's what she'll be for a while. If she has a problem, you will address it before her phone hits the receiver. Conversely, she knows that the highfalutin powers-that-be at Humco, Inc. will respond to her requests at a glacial pace. That gives you an advantage. And she knows your advantage is to her advantage.

Your soon-to-be first customer wants you to succeed, partly for business reasons, because you can make her look good to her boss or customers. But she also wants to see you succeed for emotional reasons. Everybody wants the chance to say, “I gave that successful guy his first break.” Everybody likes to pull for the little guy. Right now, there is nobody smaller than you. If you establish a good relationship with a prospect-cum-customer, she will root for you to become the best in your industry. She will say that she knew you back when, and that she was prescient enough to take a chance on you.

The day your first customer chooses to do business with you will be the luckiest day of her life, because you will treat her like the center of the universe. You will name your first child after her, even if your child is already in college. You will speak dreamingly of her to your spouse or to your pet. You will love your first customer as you have loved no near stranger before. She knows it.

Realize your advantages
To say you can use your size and newness to your advantage is not just a bunch of hooey. You really do have advantages. Let’s say your first customer calls you with a problem. How long would it take for you to respond? A split second? Less? Think how many times you’ve called someone, as a customer, and waited for what seemed like an eternity for someone to get back to you. You are resolved not to let that happen to your prospects and customers. You are going to do things the right way. Express that resolve to your soon-to-be first customer at every opportunity.