Take care of yourself

Starting a company can drive a person into the ground in many different ways. You may gain weight—or lose too much of it. You may begin to eat too much of the wrong foods, or you may barely eat at all. Pay attention to your health.

If ever there was a time to take better care of yourself, now is it. I know what you’re saying. “I can’t afford to get sick, so I won’t.” I hope you’re right, because combined stress and long work hours are going to put your health at greater risk than ever. Stress can make you more susceptible to common ailments such as colds. That’s no problem because you can work through things like that. But more serious stress-related illnesses such as high blood pressure can occur, and you won’t be able to ignore them. Also, you don’t have the luxury of turning the reins of the company over to a crackerjack staff while you recuperate. If you’re out of commission even for a week, it could seriously jeopardize the future of the company.

If you already exercise regularly, maintain your schedule as much as possible. If you don’t exercise, now is the time to start. Take walks, go for light jogs, ride a bicycle, rake the leaves, or mow the lawn now that you can’t afford to outsource the job to the neighborhood 14-year-old. Do anything that remotely resembles exercise but in no way resembles your normal work. Sure, you can’t help but think about the business while you’re exercising, but that’s OK. Do whatever you can to keep yourself in at least nominal physical shape. If you’ve never been in good condition, get there now. You won't last long, nor will your company, if you don’t. Exercise is often a nice way to free your mind enough think of creative business solutions. Just consider it multi-tasking.

You are the most important asset your company has. Protect your asset.

How Long?

Good things will eventually come from our current economic mess. Millions of Americans are getting kicked to the street. But among them is a host of talent waiting for the right moment to start new businesses. The loss of steady income isn’t the “right moment” they had in mind, but it’s the way many successful businesses have started since—forever.

Many of these new ventures will offer wholly new products and services. Others will provide new approaches to old problems that other companies have been unwilling or unable to fix. Many startups, if not most, are destined to fail. But a lot will succeed. And when each new business calls on its first prospect, they will worry about getting THE QUESTION: “How long have you been in business?” In turn, the new business will answer: “In minutes or hours?”

The fact is, that question doesn’t get asked as often one might think. When it does, don’t sweat it. A business’s age is important, but not critical, to its ability to deliver the goods. It certainly doesn’t guarantee the company will be around long. Disagree? Consider these companies:

AIG: Established 90 years ago

Lehman Brothers: Begun in 1850

General Motors: Started 101 years ago

How much confidence does the typical American consumer have in those companies today?

Be Logical

If you want to get a couple of salespeople flapping their gums at each other, ask them when the right time to talk price. An old sales "rule" says you shouldn't give the price until you've revealed all the dazzling features and benefits. It's like considering the price of a car. If someone wants to sell you a car for $20,000, you don’t know if it’s a great deal until you drive it, learn about all its options, and experience its quality. Twenty grand would be a great price for a new German import, but a terrible deal for an old Yugo with 200,000 miles on it, assuming any Yugo ever made it that far.
The thing is, withholding the price may be an acceptable approach for some types of sales, but not necessarily yours. Don't adhere to certain sales "rules" just because that's the way others have done it. As you try to snag your first customer, some things you hear and read will strike you as illogical. You’ll be advised to do things a certain way because they’ve always been done that way. But that doesn’t make them right for you. You may hear about various closing techniques that can help you land your first customer.
Look for the logic in things. If something doesn’t seem logical to you, examine it closely no matter how many so-called experts tell you otherwise. It may not be the right approach, at least in that particular situation. You find yourself in the position you are today—starting a company—because you have desire and smarts. Believe in yourself before you believe in anyone else. If something that I’ve written here doesn’t make sense in your situation, then question it closely. It may not ever make sense for you. Suspect any advice that presents itself as being the right choice in any case. With the exception of being truthful, there’s no such thing.

Enjoy being the underdog

If you think the deck is stacked impossibly against you, you are going to find it harder to land your first customer. In fact, you have lots of avenues rich with potential that you should explore before you even think of contacting someone whom you’ve never heard of and who hasn’t heard of you.

In America, we root for the underdog. That's you. Truth is, you will never be a greater underdog than when you start a company from scratch. You may not even realize it, but a lot of people are rooting for you to succeed just because you’re trying to do something most of us are too afraid to do. Some of the folks in your cheering section are people you know well. Others are people you don’t know yet. But you'll have the chance to know them because of your connections. Either way, you can leverage those new and existing relationships to find your first customer.

If you have investors, they want to see you succeed for obvious reasons. Also, they may have been in your shoes at one point and can empathize more than anybody with what it takes to get your first customers. They became successful enough to invest in your company in part because they know a lot of people. Their contacts may need exactly what you’re selling. Don’t assume your investors are automatically thinking of such relationships, however. Just because they’re smart and they’ve read your business plan does not guarantee they fully understand what you do. Millions of dollars are invested all the time by people who don’t completely understand the business they’re investing in. It’s possible that your investors are committing as much to the potential of you as they are to the promise of your company.

Therefore, your company will benefit if you give your investors, during regular meetings or investor updates, your vision of who your ideal customer is. And then ask your investors if your description fits anyone they know. If they don’t suggest anyone the first time you ask, ask again a few months later. As your notion of your ideal customer changes, share that with your supporters, too. Sooner, if not later, they will provide important names. Those may be some of the best leads you receive.

If you borrowed money to start your company, your loan officer also has a vested interest in seeing you succeed. She wants to improve the chances of getting her bank’s money back—along with all that interest you’re fretting over. She comes into contact with other business owners every day. The same type of regular email or phone call updates that trigger an investor's thoughts can also work for a loan officer. It’s like being the squeaky wheel, except you’re informing rather than complaining. If an investor, loan officer or other money person hears from you once in a while, your situation—and need for prospects—will be top of mind. And remember, you’re not asking these people for anything material. You’re only helping them protect their investment and their reputation by providing a connection to prospects.

Give and then give some more

If you start any relationship interested solely in what you’ll get out of it, you’ll get out of business sooner rather than later. Giving more than you receive in a business relationship creates a high level of confidence and respect by your prospects, and subsequently, your customers. At every turn, seek ways to rise above the prospect’s expectations. It’s the direct route to a happy customer. And once the prospect becomes a customer, do even more. Surprise them. Delight them. Impress them.

Consider what information, advice or service you can offer a prospect—at no charge—that will reinforce your industry expertise. You don’t have to give anything that’s isn’t already free in the strictest sense of the word. You just have to make it more readily available to your prospects and customers. A lot of information on nearly any topic is available on the Internet. But you make it easily available, with attribution, on your letterhead or your own web site. If you do, you'll provide your customers something of value that they will associate with you.

Your prospects will associate you with smarts. If you weren’t already a pretty smart cookie, you wouldn’t be involved in a new company. You wouldn’t be where you are now if you did not have a lot going for you. The prospect probably already assumes that. Sharing a bit of your knowledge, without expecting something in return, will help confirm it.

You, as the expert, can share a little bit of your knowledge, positioning yourself as a leader while easing possible concerns about the newness of your company. Some easy ways to do that include:
· Regular newsletters with articles and tips that avoid blatant self promotion.
· White papers about industry trends that prospects may not be aware of.
· Tips on how to take full advantage of products or services like those you offer. Better yet, offer tips on how to avoid overspending on services that the prospect may not need.
· A free analysis of a prospect’s current processes with no obligation to choose your offering.

You can probably think of several other tactics related to your industry. You know things that the prospect wants to know. Even more likely, you know things they need to know, but don’t realize it and don’t have time to get it.

Take all prospects seriously

In the early days of my online registration software company, I called the executive director of an education organization in North Carolina. The moment I introduced myself, she said that I should arrange a demo with her assistant. I had no great expectations for the call, because, from what I could tell, the organization was not very large nor did it have a large budget. (Before making any call, my research most often consisted of visiting a prospect’s web site to see what types of events required registrations.)

The North Carolina organization seemed as though it could benefit from online registration, but I didn’t get the feeling they held a lot of events. Therefore, I wasn't expecting a huge sale that would fund my children’s college educations. However, I was encouraged that the decision maker told me to set up the demo with her assistant. It would be up to the assistant to decide if our software was worthy, but the boss given me a tiny boost of credibility by passing me along to her assistant.

The assistant--I'll call her Betty--quickly agreed to an online demonstration. About five minutes into it, however, things seemed to sour quickly. Betty began asking questions that had nothing to do with what I was showing her. Her biggest concern seemed to come out of nowhere. “How does your software identify if a person registering is legitimate?” I gave her a list of ways it could help with her problem. But no matter how I tried, I couldn’t get Betty past her concern. She was certain that people would try to register for her workshops—which were free—when they shouldn’t be allowed to. It cost a lot of money to host the workshops, she said, and she wanted to make sure entry was limited to those who were members of the organization. Understood, I said, but I wondered to myself how many persons would actually want to sneak into a workshop on new federal regulations regarding the teaching of math to 8th graders.



I quickly came to believe that Betty didn’t want our online registration software nearly as much I wanted her to have it. To me, her concern was so small compared to all the benefits I thought online registration could give her. After repeated attempts to address her worry, I finally said, “Perhaps our software simply isn’t right for you. Maybe we can talk at some other point when you’re more interested.” It was my way of saying I didn’t want to waste any more time.

I was way off the mark. “Oh, we’re very interested,” Betty assured me. “We’ve been talking about this for a long time. It’s just that one thing about rogue registrations that always trips us up when we try to get online registration.” I then realized that if we could solve Betty’s problem, we had a good shot at the business. After further exploration, I discovered the potential for the deal was a lot bigger than I had projected. In fact, Betty and her organization soon became a high-paying, low-maintenance customer.

I had made the mistake of assuming that Betty offered very little potential as customer, and approached her likewise. Even if she had turned out to be a small customer, or no customer at all, I later realized that she deserved my full attention. All prospects do.

Relax a little

Nothing scares a prospect away faster than desperation. The more pressure you put on yourself to get that first client, the more pressure your prospects may feel as well.
Here’s a story from the early days of my company, a provider of online registration software: We had only a handful of customers and were still hurting for revenue when we were contacted by a district organization of Rotary International in Silicon Valley. (Inbound plus: Uncovering new markets) The Rotary district wanted to switch to a new online registration provider for their annual conference.

At first, we did everything we could, just as normal, to win the business. This included online demos and responding quickly to a myriad of questions. Even though the prospect was three time zones away, we made ourselves available late into the evenings. We didn’t build up ourselves to sound bigger than we were, but we put our experiences with our meager pool of customers in the best light. However, it seemed apparent to us as the sales cycle progressed that we had little chance of landing the account. For one thing, our software was still relatively new, and there were a few features the Rotary officials needed that our software did not yet include.

This was nothing new; we often made key enhancements to the software based on what prospects wanted, often at little or no additional charge. However, we sensed that the decision makers with the club were only mildly interested in working with us. Because we needed revenue—any revenue—we could have tried to win the Rotary’s business by saying, “Just tell us what we have to do to persuade you to choose us. We’ll make all the upgrades you need. We’ll discount our price some more. We’ll wash your car every Saturday for the next three months. Anything you want. Please, please, please.”

Who knows? We might have landed them as a customer that way, or our begging may have turned them off. Instead, we relaxed, assuming we had little chance of getting the sale. We said we could make the enhancements the Rotary wanted, but at full price. They had another request that was a little outside our realm, but we agreed to meet that request, too, at full price. Then, rather than calling them constantly to ask them if they had made a decision, we focused our attention on what we thought were more promising prospects. Two days later, the Rotary agreed to the full proposal. At the time, they were our highest-paying customer. And once the Rotary District became a customer, we went back into mega customer service mode, trying to give them a lot more than they had paid for. Years later, they remain a customer.

Particularly in the early going, it will be natural to put a lot of pressure on yourself to turn each prospect into a customer. You will be nearly desperate for their business. Sometimes, however, you have to relax a little, and to allow the prospect to relax a little, too.

Five Keys to Drawing a Sales Circle

A fine line exists between convincing a prospect that you want her business and bugging her so much that you chase her away. Though you would like to do so, you can’t make the prospect’s decision for her. However, you can do the next best thing by providing her everything she needs to make an informed choice—which is to select your service.

An advertising maxim likens this process to forming a circle, which you can start, but only the prospect can complete. This applies to you first customer and your fiftieth one. Your job is to arm the prospect with key pieces of information and to make her feel comfortable in making a decision. If you’re using any phrases similar to the ones below, however, you’re trying to complete the circle for her:
- We’re the smart choice.
- Our service is simply the best.
- Our company is the worldwide leader in (fill in the blank)
- We’re so much better than our competition, it’s embarrassing.

Never tell the prospect how great you are. Rather, give her the facts to draw that conclusion. At the other extreme, there is danger in not going far enough, which means you haven’t provided sufficient information. As a result, the prospect can’t reach the conclusion you want because there is too much effort, too much left to question, and too little comfort with you or your service.

Your job is to draw a circle until it’s nearly complete and then hand the pencil to the prospect. The circle begins when the prospect realizes she has a need. The line arcs as you build her interest in your service and then reaches its logical conclusion when the prospect realizes the best way to address her need is by choosing you.

Five easy ways to form a circle
Forming a near circle requires a set of tools that you can draw on for each situation. Here are five basic ones:
1. Testimonials
As a new company, testimonials can about you, from relationships you formed in other positions. It seems like a no-brainer, but third-party validation is such a powerful, yet often under-utilized, tool. Never say anything good about yourself when you have someone else happy say it for you.

2. Mini-case studies
As soon as you've established your first customer, use them as a case study. They are another strong form of third-party validation which help overcome your company's newness. A mini-case study should contain two or three paragraphs that briefly tell how a customer leveraged your service to solve a problem.
Here’s a simple format:
Challenge > Solution > Result
Powerful case studies should mention a return on investment, such as savings in time or the elimination of stress.

3. Trials
Let the prospect give your service a brief test drive. Quite often, a prospect’s time is much more important to her than the cost of your service. If she takes time to try it, she’s serious. Another tip: Arrange with the prospect a specific stop and end point for any trial to ensure she tests your service in a timely fashion. If a prospect has an open-ended trial, she is less likely to feel any urgency.

4. Third-party information
Prospects choose you as much as they choose your service. Prospects—human beings that they are—love getting information about things that interest them. For example, you could say, “Ms. Prospect, I just came across this article that I thought you might find interesting. I know it’s a subject that’s near to your heart.” It’s another way to show you’ve taken time to understand how her business works.

5. Listening skills
It’s natural to be so excited about your service that you can’t help but talk on and on about it. But as much as you want to talk, the prospect wants to talk more. And she wants you to actively listen, which can be the quickest way to making a nearly-complete circle. If you don’t listen, you won’t know which testimonial to share, or which mini-case study compares best to the prospect’s situation. Tip: Record yourself talking to a prospect. Even if it’s just one end of a phone call, it helps to review how you conduct a conversation. As painful as it may be to hear yourself, you will know quickly if you’re listening well or possibly talking over the prospect.

In the end, relax a little. Prospects sense when you’re overly eager to gain a sale and to move them along faster than they want to move. They can equally sense when you’re comfortable enough to let your tools work for you. Soon, the prospect is ready to complete the circle, and you’ve earned the business.

Know Your Numbers, part 2

You'll likely find cold calling a necessary evil unless you already have a handful of solid leads when you start your company, or until your first customers begin to refer others to you.

Outbound plusses:
· If you reach a prospect, or at least a suspect, through cold calling, then she may not know


anything about your competitors.
· When you do your research (always do research before a call), you may catch the prospect


just as she is thinking about buying. It often happens.
· If the prospect has not thought about buying, you get the opportunity to educate her a


little, helping her to identify a business pain that she may not have realized she had. When


she pictures the solution to that pain, perhaps she’ll envision no one but you.



Outbound minuses:
· Nobody likes receiving cold calls.
· You don’t like making them.
· The sales cycle could be longer because the prospect is in less hurry than the inbound caller


to make a decision.
· The prospect, only mildly serious about buying anyway, may never make a decision, other


than the decision to do nothing.
· You really, really don’t like making cold calls.
· The prospect really, really doesn’t like getting them.


· You successfully get the prospect thinking she needs what you're offering, but she decides


to see who else out there offers something similar.



Some mix of inbound and outbound calls is essential to most any new company’s survival. Diligently track your numbers and results so you always know where and how to focus your efforts.



Here’s an example of the ratios you should track:



Inbound inquiries > Appointments > Proposals > Sales
Outbound calls > Appointments > Proposals > Sales



Also, track the sales cycle (time from call to sale) for each prospect, as well as the total initial value of the sale. For example, does it take two weeks to make a sale from inbound inquiries, but six weeks to make a sale from outbound calls? If you’re lucky, you’ll find that the inbound inquiries, though fewer, will generate more revenue in a shorter amount of time than a higher number of outbound calls.

Be Ready with References

It’s reasonable to expect prospects to ask for references when they’re thinking seriously about choosing your company. You may not be looking forward to that time since (a slightly important detail) you don’t have any customers yet from which to collect references. At that point, you have three choices:

1. You can begin crying uncontrollably and hang up the phone.
2. You can say, “Sorry. We don’t have any references, yet. You’ll just have to trust me.”
3. You can provide references.

Unless you just recently fell off the turnip truck, you must have come into contact with another human being at some point in your professional life. Let’s hope you’ve even had a relationship with someone who thinks favorably of you. Remember, people are buying you as much as they are buying the thing you’re selling. Since you’ll be developing and tweaking your product or service on the run, particularly in the early stages of your business, you’ll have to convince prospects to believe in you in other ways. Therefore, line up former associates who can say good things about YOU, since you’re the most important part of the equation anyway. Possibilities for positive references: investors, suppliers, patent attorneys, etc.

“As you know,” you can tell the prospect, “we are new. Therefore, any references I give you related to this company would give you limited insight. However, I have three customers from my last employer who are happy to talk to you.”

If your new business is in any way similar to your previous occupation, your old customers should be fantastic references. Even better, they should also be fantastic prospects that would take care of the reference challenge by itself. Don’t just think of “customers” in the traditional sense. You can also find solid references in internal customers—fellow employees or senior managers to whom you provided deliverables at a previous job.

Line up your references before anyone asks you for them so you don’t have to scramble to arrange them at the last minute. And just as if you were interviewing for a job, which you are, don’t provide the names of anyone who hasn’t already agreed wholeheartedly to say good things about you. That said, there is no need for wailing and gnashing of teeth over references. In my experience, well fewer than half of prospects ask for references anyway. And if they do, they may never call them. Just seeing the names may be enough.

Note: Once you have them, you will work very hard to keep your customers happy. In turn, you’ll build a good list of customers who will be eager to speak on your behalf. But I recommend never providing any references unless the prospect asks. It can unnecessarily slow down the sales cycle if the prospect takes time to check all the references.

Look for the Curve Ball

As a new entrepreneur, you'll face the question of whether a prospect’s business is worth your effort. You're like a hitter at the plate watching a variety of pitches coming your way and trying to decide which ones are worth taking a swing at. Because you need customers, it will be tempting to swing at everything.

Types of pitches (prospects)
The first pitch is a sweet one right in your wheelhouse, which means your solution addresses the prospect’s needs so perfectly that it’s like getting the perfect pitch to hit out of the park. One easy swing and BAM you have a new customer. You barely broke a sweat as a result. These prospects don’t come around often enough.

The next best pitch, which you may see most frequently, comes in a little high and outside. You’ll have to reach a little, but it’s still possible to get some good wood on the ball. Your solution matches most of the prospect’s requirements. With a few adjustments or enhancements, you can address her needs thoroughly. You make the adjustments because

1) you need customers and revenue and

2) you recognize that the adjustments would appeal to other prospects.


Perhaps some of those adjustments can even wait until after the prospect becomes a customer, and you develop a level of trust. You may even come to appreciate this type of pitch more than the “perfect pitch” because you improved your product/service as a result.

You have to give the closest look at the third type of pitch. It is so far over your head that it will smack against the backstop unless you make contact. You can hit this pitch, too, but you’ll probably need a stepladder. The payoff might be sweet in the short term, but is it really worth the effort?

The pitches headed for the backstop come from clients who would require all sorts of enhancements in order to get exactly what they want. In fact, their requirements may change your offering in a way that bears little resemblance to what it looks like now. On the other hand, you may make a lot more money off this one deal than all the others. It may be a long time, if ever, before the necessary enhancements would benefit your other current prospects. Those changes could even make your product/service less appealing to your regular target group.

You have to decide, particularly in the early days of your company, if you should take a swing at this pitch or let it go by. You will hear a lot prospects say, “Your stuff is nice, but it would be really great for us if it just had (fill in the blank).” Yes, it would be great—for them. But would it be great for your company?

Listen closely to your prospects. Some of their suggestions could have you chasing short-term revenue at the sacrifice of long term potential for your company. However, your prospects will often have legitimate ideas to make your offering better. No one knows their industry better than they do. If their needs have been unmet for a long time, they're also be the needs of their competitors.

If you really listen to what your prospects are saying, and if you are more interested in becoming successful than in simply sticking to your original vision, you'll give your venture a better chance. Certainly, your company may not bear much resemblance to what it was in the beginning, but part of the difference could be a little thing called PROFIT.

Many ventures have changed dramatically from what they started out doing. But they are still in business.

Know your competition

Perhaps you dream that you will triumph so completely over your competitors that they will finally say, “We give up. You are the best. We’re getting out of the business.” You'll then be alone, victorious, atop the mountain. Don’t wish it to happen too fast, though, because your competition is essential to your initial success. If a prospect asks you to name your top three competitors, do not say, “Uh. Gee, that’s a good question.”

If you can't name your competitors, your prospect will likely think one of three things:
1) You’re uncomfortable with comparisons to your rivals (not so good).
2) You haven’t done your homework (bad).
3) Your product is so far off the mark that no other company has thought it worth developing (time to punt).

It's usually easier to sell something if you’re not the first to sell it. You'll need a marketing position, and it’s a lot easier to establish one if you have something or someone to position against, such as a rival.

Maybe you really are so far ahead of your time, so visionary, that you’ll have trouble finding significant competition (other than the inaction of your prospects, which is always the toughest competition). If that’s the case, sales will come a lot harder. It is tough enough if you are a new company and no one has ever bought your stuff before. It is exceptionally difficult if no one has bought what you are selling from anybody else either. You say you’re bigger, faster or friendlier? Than what or whom?

The more clearly you can understand your rivals and understand how they compare to you, the better your position will be with your prospect. Most prospects are reluctant to sail uncharted territory when their image and money are on the line. For every visionary out there, ten prospects will be timid about working with a new company. You must generate in him the confidence that he will not be GOING WHERE NO MAN HAS GONE BEFORE. That is no place for most would-be customers. It is possible to convince a prospect to take a chance on a company that has no customers. It is a lot more difficult to convince them to be the first to buy something that is an entirely new concept.

Competitors offer proof of concept. Prospects will take some comfort in knowing others are in a business similar to yours. You can take comfort in that knowledge, too.

How "Free" can be Profitable

Sometimes, the fastest way to a paying customer is through one who doesn’t pay: a pilot customer. Such an idea is anathema if you believe the only thing that can come from providing something for free is the chance to provide more of it for free. I understand you may not like the idea of a pilot customer, since--I'm just guessing--you’re entering business to make money. Let’s say, however, that it’s three months since you started your company, you have no prospects ready to sign an agreement, and your spouse is starting to give you impatient looks and heavy sighs. Maybe a pilot customer isn’t such a bad idea after all.

Actually, each of us is asked to be a pilot customer nearly everyday. When I go to my neighborhood fresh produce store, for example, my goal is buy bananas and strawberries. But I have to navigate around stands offering free samples of stuff the store wants to push--stuff I don't need. This often includes salsas and spreads. But it's free, so I usually try some. One day, the salsa was accompanied by a brand of tortilla chips that I’d never tried before. I usually buy tortilla chips at a grocery store, rather than a fruit and vegetable business. But the chips were so fresh and crunchy that I started buying them at the produce place.

Pilot customers lead to paying customers. My company, ABC Signup, wouldn't exist if it weren't for a pilot customer, which not only helped us line up our first paying customers, but soon became a paying customer itself. More on that next time.

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.

If you can't go back...

Maybe you can’t go back to your former employer. If this is a perfect time to start your own company because you lost your job after angering or alienating everyone you ever worked with, perhaps you should consider a profession that does not require interaction with human beings. Perhaps muskrat keeper at your local zoo. If that’s not the case, however, you may still have a good chance of landing customers as a result of your former employment. In fact, you may actually have multiple chances.

Let’s say that Phil was laid off from his marketing job at Dweebco, International. He had been part of a six-person marketing team that was scattered to the wind when financial setbacks forced Dweebco to eliminate its marketing department. While his team members took jobs with other corporations, Phil decided the time was right to start his own marketing consulting firm. The first prospect on Phil’s list was Dweebco. Even though they couldn’t afford to pay a full-time marketing staff, they might still need marketing help. In fact, Phil suspected, they probably needed it more than ever. Dweedco would get the service they need without paying benefits and everything else to a full-time employee. Phil would get to charge a higher rate than his old salary
Suppose, however, that things at Dweebco had gotten so bad after Phil left that the company went out of business. Phil still had five ready-made prospects: his former colleagues. Their new employers were in a much better position to use Phil’s services. They were in a hiring mode, which meant Phil was in the right place at the right time to help meet additional demand. Phil contacted his former colleagues who then recommended him to their new employers, as well as other companies that had a connection to.

When you work for someone else, you are essentially a one-person company existing to serve your employer. If that company hired you once, they should want to hire you again--as an outside vendor--if the you left on good terms.

Borrow Credibility

My business partner met a budding entrepreneur at a party last weekend. The guy was the marketing/sales "arm" of a start-up company that developed a web-based storage system for medical records. So far, the company consists of the sales guy, plus the person who developed the software. And neither has left his full time job yet. My partner asked a blunt question : How would the sales guy convince medical offices to trust highly sensitive information to a new product developed by someone working in his basement at night? The new entrepreneur hadn't thought it through that far.

You need instant credibility, which may mean borrowing some. That could come in the form of a strategic partnership with another person or company that is already highly respected in your industry. It may mean starting as an entrepreneurial arm of an established company. You could build your dream within a viable business, while leveraging a bit of their image--and money. A few years down the road, you could spin off into an independent company.

Another way: Grab credibility by certification from a known brand, such as the kind Microsoft offers software developers. Then you can say: "Our people are Microsoft-certified and have expertise in the latest Microsoft web hosting products.” The prospect will hear: “Blah Blah Blah Microsoft blah blah blah blah blah Microsoft blah blah blah.” And then they think, “Hmm. I’ve heard of Microsoft. These people are OK is they’re Microsoft people.” That is, unless the prospect is a Firefox nut.

Align yourself with their customers

If you’re having a tough time reaching out to your prospects, reach out to their customers instead.

In the late 90s, I was the vice president of marketing for an Internet-based company called Construction Zone (CZ). CZ had an idea (not mine) that helped them get over the no-customer hurdle. The company developed a searchable database of formatted building product information. Rather, they wanted to develop a database.

The people who would use such a tool were all for it. They were architects, engineers and others who sought an easy way do so side-by-side comparisons of construction product information. They were also in favor of the online database because they wouldn’t have to pay for it. That would be up to building product manufacturers, whom CZ would have to convince to put their information online where their potential customers could compare it with the competition.

The general reaction from manufacturers to the idea was, “Why should we pay you when you don’t have any architects searching your database?” At the same time, architects and engineers said, “We would love to use your site, but not until you have the product information we want.” CZ needed to produce an egg at the same time it produced a chicken. Therefore, the company began to build credibility by holding listening sessions.

Each listening session consisted of potential users (architects, etc.) and potential customers (building product manufacturers). Architects from large firms were delighted to attend because it gave them a forum to express their vision of a perfect world for finding product information. Manufacturers (CZ’s prospects) eagerly attended because it meant they could be in the same room with their prospects—architects who held the key to millions of dollars in potential business.

CZ briefly outlined its idea for the database, and then sat back and listened as the architects raved about the benefits of such a tool. Rather than promise manufacturers that architects would use the tool if the manufacturers would only put their information there, CZ allowed the architects to say so themselves. It was as if CZ had teamed up with some of the most powerful decision makers in the architectural world.

Another key to the success of the listening sessions was for CZ to LISTEN. The company did not trot out its sales spiel during the sessions. Instead, CZ asked attendees, “What do you think of our idea? How would you make it better?”

The listening sessions helped CZ foster a bit of credibility before they had many customers. When manufacturers saw their potential customers getting excited about the database, they got excited, too. By realizing that CZ was taking their interests seriously, they were more inclined to try a new concept by a new company. Many of the manufacturing companies in those listening sessions eventually became CZ customers.

If the participants in listening sessions had seen the gatherings as a veiled attempt only to generate sales, the events would have been less productive, or even counterproductive. Commit to being as neutral as possible so that you can reap the invaluable information generated.

Tap the brains of wise people (without paying them)

Develop some of the credibility you need. When someone chooses to be your customer, she will prove her infinite wisdom, right? The wisest people in your industry are those who boast a long record of success. Some are your competitors, but many more are potential customers. Contact some of them, but don’t worry yet about turning them into customers.

Your immediate goal is to learn from them.
Imagine Lucas has a new ATV that he never drives because he’s afraid he will wreck it. He wishes he could think of a way to drive as fast he wants on the ATV, while guaranteeing it will never roll over. One evening, as he ponders his dilemma, Lucas watches his pet hamster speed across the living room carpet in its plastic ball. Eureka! Lucas says to himself. He will create a large plastic ball big enough for his ATV to fit inside. No matter how fast he drives, the ATV will never tip over. Better yet, Lucas figures a lot of other ATV enthusiasts would buy such a ball. Lucas builds a prototype and decides to call his contraption The Bubble Over. He’s pretty sure he’s a genius, and believes he can sell millions of Bubble Overs.

Lucas is business-savvy, so he wants to prove the practicality of The Bubble Over before he spends a lot of money manufacturing it. He gets in touch with Carl, the owner of the local ATV dealership, to ask if he can pick his brain. From research, Lucas knows that Carl has been selling ATVs for 25 years and that he is well respected in the industry because he understands what ATV owners want and need. Sure, Carl says to Lucas’ invitation. He is always willing to hear about new products that might benefit his customers. Like most of us, Carl loves it when people ask, “Can I get your advice on something?”


Lucas brings his prototype of The Bubble Over with him to the meeting so that Carl can try it. Based on Carl’s feedback, Lucas starts to get an idea of how well the marketplace will receive his product. Carl also offers suggestions on how Lucas might make The Bubble Over better. As Lucas starts a relationship with Carl, he is also starting to show that he is committed to solving a problem in Carl’s industry. He knows Carl’s experience is the most important thing he can tap into at the beginning of his venture. Simultaneously, Carl is turning into Lucas’ prospect. If he should become the first distributor of The Bubble Over, his good reputation in the ATV industry will make it easier for Lucas to land subsequent customers. Lucas has just taken a big step toward credibility.


Because Lucas is a smart guy, he wants feedback from lots of people in the ATV industry to ensure he’s getting an adequate picture of the potential for his product. Therefore, he contacts other ATV dealers, too. The first words out of his mouth when he calls the other dealers are, “You know Carl, right? He’s been advising me…” The other dealers will be happy to offer their input as well. Every bit of feedback Lucas receives helps him better understand the viability of The Bubble Over. As he improves his product and prepares it for market, he’s also building a sales pipeline.


You can probably find plenty of movers and shakers in your chosen industry that can offer you advice on the viability of your business, particularly if you demonstrate an interest in providing a new or better solution to their problems. Nothing is more freely given than advice, especially when the results of the advice may help the adviser as much as the advisee.
“What do you think?” are sweet words that your advisers (first prospects) will love to hear.

Design the Perfect Customer

Complete this sentence: “My perfect customer is (fill in the bank) and spends gobs of money with me.” The right time to begin imagining your perfect customer is before you have any. Right now, you may define your ideal customer as anyone who is willing to pay you, which means you haven’t established many standards. It’s possible that some customers will actually be more trouble than they’re worth, no matter how much they pay. If you spend a little time now imagining your best customers, you can better identify them when they come along. Better yet, you can avoid the ones who don’t meet enough of your criteria.


Because your shriveling bank account is ever on your mind in the early going, it’s natural to accept and hang on to customers even if the hassles they create seem to outweigh their benefits. You’ll say to yourself, “We can stomach them as long as they pay.” Just don’t stomach them too long if they distract you from getting better customers.

Put your business plan to work
Your company’s business plan is supposed to serve a greater purpose than to help you obtain funding. It is supposed to serve as your road map to success, which should involve finding a paying customer or two. Take a fresh approach to your plan and begin to flesh out the description of your target customers. How would you define your ideal client? Even if you’ve never sold anything before, somewhere in your life you have had customer-vendor relationships, even if it goes back to selling lemonade when you were ten years old. Picture in your mind the best customer you’ve ever had and try to remember what made him so great to work with:

- Did he pay his bills on time?
- Did he trust that you knew what you were doing?
- Did he have the confidence of his boss, or was he the boss?
- Did he acknowledge the times you went to extraordinary measures to meet his needs and demands?
- Did you hurry to pick up the phone when you knew he was on hold?
- Would you find him likeable even if he weren’t helping to pay your mortgage?

Maybe it’s easier to form a picture of the worst customer and then to avoid him:
- Did your worst customer think he could do your job better than you could? (Makes you wonder why he was spending good money for your help.)
- Did you sometimes get the sense that you were talking to a brick wall, as if the words that came out of your mouth were not making it past the customer’s glazed look?
- Did he often seem unhappy with your work, even though he could never adequately explain why?
- Did he end the relationship with the equivalent of the boyfriend-girlfriend breakup: “It’s not you. It’s me”?

With such questions in mind, you can begin to look for important signs from prospects, such as:
- Does she clearly express her expectations?
- Does she answer your questions with, “Uh, let me think about that” or “you figure it out?”
- Does she recall promises you’re pretty sure you never made?
- Does she give a realistic timeline for you to develop a proposal or presentation on your product/service?
- Does she listen when you speak?
- Does she “get it” when you talk about your product/service?
- If you are not dealing with the top dog, do you sense that your prospect has the ear and the confidence of her boss?

Most customers will fall someplace in between the ideal and the worst case. Don't be ultra-selective when you are trying to sign up a customer—any customer. However, it would help if avoid a bad one as your first customer since you will have your hands full as it is. You should try to identify prospects who will help you validate your decision to give up the finer things in life like premium cable just so you could start your own company. It’s easier to cut someone loose when they’re a prospect than when they are already your customer.

As you begin to develop your customer base, you can periodically return to your list of ideal-customer characteristics. If you’re lucky, you may have one of two customers that come close to your ideal early on. Possibly, the concept of the perfect customer that you develop will change a lot once you have a few clients under your belt.

Compelling Reason #1 that Being a New Business is an Asset: You

Your main advantage over your competitors—an asset they can never offer—is YOU. You’re not starting a company because you want to be second best. You're doing it because of something that distinguishes you from any other venture in your industry. Maybe you have a great idea. Or maybe you know how to provide a particular product or service in a way no one else is. It may be that your experience or level of expertise is unique. Perhaps you have a knack for finding solutions to tough problems.

Was your previous employer getting the job done the way you knew it should be? Perhaps you were the reason your previous employer was successful. Maybe you left your former company just so you could build a better mousetrap. And now here you are, ready to show your future customers how to catch mice. Perhaps you have lots of great ideas about how to better serve customers, ideas that languished at your old company because they had to be filtered through too many levels of bureaucracy filled with people who lacked your vision. Unless you have a lot of split personalities, your ideas will get implemented in warp time at your new company. Whatever your reason for going into business, it should make a compelling story for your prospects. One of your first jobs is to identify that story to help you turn a prospect into your first customer.

Even when your business is 20 years old and you are able to take three-week vacations to Acapulco, one thing will never change: Your new customers will buy you more than they will buy the thing you're selling. All the gadgets and gizmos in the world will not make them want to do business with you if they don't think they can count on you. You will convince them that you can listen and react to their needs in a timely fashion. They know you will pay attention.
You are selling them a relationship with you. Sure, it sounds like a cliché, but it’s true. Even if you are the sum total of your company, you amount to a lot. You are the most important part of your company. Embrace that fact even if you set up shop in your utility shed and use the riding lawn mower as your conference table.