فصل 5

CHAPTER FIVE

Commitment and advancement

Once we’ve learned the key facts about our industry and customers, it’s time to zoom in again and start revealing our idea and showing some product. The bad news is that this invites nefarious compliments. The good news is that since we have the beginnings of a product, we’re now in a position to cut through the false positives by asking for commitments.

In sales, moving a sales relationship to the next stage is called “advancement”. It’s like pushing a customer into the next step of your real-world acquisition funnel. They’ll either move forward or make it clear that they’re not a customer. Both are good results for your learning.

When you fail to push for advancement, you end up with zombie leads: potential customers (or investors) who keep taking meetings with you and saying nice things, but who never seem to cut a check. It’s like your startup has been friend-zoned.

Thankfully, you caused it, and that means you can fix it. It’s a consequence of being clingy and fearing rejection. By giving them a clear chance to either commit or reject us, we get out of the friend-zone and can identify the real leads.

As always, you’re not trying to convince every person to like what you’re doing. When you’ve got the information you came for (even if it’s that they don’t care), you can leave. But at some point, you do need to put them to a decision in order to get it.

Symptoms:

A pipeline of zombie leads

Ending product meetings with a compliment Ending product meetings with no clear next steps Meetings which “went well”

They haven’t given up anything of value As I use them in a customer learning context, commitment and advancement are separate concepts which overlap quite a lot and tend to appear together.

Commitment — They are showing they’re serious by giving up something they value such as time, reputation, or money.

Advancement — They are moving to the next step of your real-world funnel and getting closer to a sale.

Commitment and advancement often arrive hand-in-hand. For example, to move to the next step (advancement), you might need an introduction to your contact’s boss (reputation commitment). As such, they are functionally equivalent for our purposes and I’m going to blur them into one concept for the following sections.

Rule of thumb: “Customers” who keep being friendly but aren’t ever going to buy are a particularly dangerous source of mixed signals.

Meetings succeed or fail

It took me years to learn that there’s no such thing as a meeting which just “went well”. Every meeting either succeeds or fails. You’ve lost the meeting when you leave with a compliment or a stalling tactic. While we might spot something as blatant as “Let’s talk again after the holidays. Don’t call me, I’ll call you,” we accept the more subtle versions every day.

A meeting has succeeded when it ends with a commitment to advance to the next step. But you have to force this resolution or the meetings drift along in la-la-land while performing their ancient duty: wasting everyone’s time.

If you leave with worthless wishy washiness, I’d bet you’re falling for one or both of the following traps: You’re asking for their opinion about your idea (e.g. fishing for compliments) You’re not asking for a clear commitment or next steps You know how to deal with compliments by now: deflect, ignore, and get back to business. Commitments are similarly easy to master, once we know what we’re looking for. When we leave without a commitment, sometimes it’s because we asked and got rejected. That’s sad, but it happens. Not everyone is going to convert and at least you now know where you stand. You have a strong negative data point.

The real failure is listed above as 2: not even asking. I never consider rejection to be a real failure. But not asking certainly is. This can happen because you avoid the scary question or because you haven’t figured out what the next steps should be.

Commitment is important. It tells us whether people are actually telling the truth. The more they give us, the more we can trust what they say.

Rule of thumb: If you don’t know what happens next after a product or sales meeting, the meeting was pointless.

The currencies of conversation

Commitment can be cash, but doesn’t have to be. Think of it in terms of currency—what are they giving up for you? A compliment costs them nothing, so it’s worth nothing and carries no data. The major currencies are time, reputation risk, and cash.

A time commitment could include:

Clear next meeting with known goals

Sitting down to give feedback on wireframes Using a trial themselves for a non-trivial period Reputation risk commitments might be:

Intro to peers or team

Intro to a decision maker (boss, spouse, lawyer) Giving a public testimonial or case study Financial commitments are easier to imagine and include: Letter of intent (non-legal but gentlemanly agreement to purchase) Pre-order

Deposit

Sometimes, strong commitments combine multiple currencies, such as someone agreeing to run a paid trial with their whole team, thus risking their time, money, and reputation.

Just like compliments aren’t data when you’re trying to learn about a problem, they also aren’t progress when you’re trying to validate a product. Hearing a compliment can still be useful though—it’s a warning flag that the person you’re talking to is trying to get rid of you.

Rule of thumb: The more they’re giving up, the more seriously you can take their kind words.

Good meeting / bad meeting

Game time again. We just had a meeting. But how did it go? Were they good meetings or bad meetings? Why? And if they’re bad, what can we do to fix them?

Have a think about the meetings listed below and then turn the page for further discussion.

“That’s so cool. I love it!”

“Looks great. Let me know when it launches.” “There are a couple people I can intro you to when you’re ready.” “What are the next steps?”

“I would definitely buy that.”

“When can we start the trial?”

“Can I buy the prototype?”

“When can you come back to talk to the rest of the team?” “That’s so cool. I love it!”

Bad meeting. Pure, unadulterated compliment. This may make you feel good, but there is precisely zero data here. But at least you won’t hurt yourself on this one since it’s so obviously fluff.

To fix it, deflect the compliment and get back to business.

“Looks great. Let me know when it launches.”

Bad meeting. A compliment plus a stalling tactic is the classic way to end a pitch for something you’re never going to buy. This comes in a lot of flavours, but they’re all basically a polite way to say, “Don’t call me, I’ll call you.” The big error you can make here is to mistake this compliment-stall for a pre-order (“He said he’ll buy it when it launches!”). To fix it, I’d look for a commitment I could ask for today.

If I was very early stage, I might ask for an introduction to his boss or tech team or the budget-holder so I can make sure I fully understand their needs.

If I was slightly further through development, I might push him to agree to be one of our alpha users and to roll it out to some subset of their team and be a case study for launch. If I’ve hit on a real problem, he’ll jump at the chance to start making progress today and get early access.

“There are a couple people I can introduce you to when you’re ready.”

Nearly a good meeting, but right now it’s bad. There’s some data here, but probably not as much as you initially hope. On the bright side, at least you know he doesn’t think you’re completely nuts or he wouldn’t have even made the fluffy offer (unless he’s just name dropping). The problem is that the promise is so generic that it’s a worthless signal.

To fix it, try to convert fuzzy promises into something more concrete. The more specific it is, the more seriously you can take it. For example: who does he want to introduce you to and what does “ready” mean? And why can’t he make the intro now? This isn’t about being pushy. You don’t have manifest destiny over his rolodex. But you do need to distinguish between legitimate offers and polite gesturing. Knowing what “ready” means can also give you a better sense of what your short-term goals should be.

“What are the next steps?”

Good meeting. A classic good meeting conclusion. To succeed, a meeting doesn’t need to end with a check in your pocket. It just needs to advance to the next step, whatever that is.

It’s worth noting that you need to know your next steps to benefit from this. If you have to say, “Let me have a think about that and get back to you,” then you’ve ruined a perfectly good meeting.

Of course, even clear next steps can be a lie. Everything can be a lie. But with next steps in your pocket, you’ve got a fighting chance.

“I would definitely buy that.”

Bad meeting. Danger! There’s admittedly some signal here, but the false positive danger is off the charts. This is the mis-interpreted answer which sunk the first startup I worked at to the tune of ten million bucks.

To fix it, you need to shift from fuzzy future promises into concrete current commitments. For example, you could ask for a letter of intent, a pre-purchase or deposit, or intros to other decision makers and team members. Kickstarter is so wonderful because it forces customers who say they would buy it to actually pull out a credit card and commit.

“When can we start the trial?”

Maybe a good meeting. Unlike “when does it launch,” which is usually a stall, “When can we start” is a step forward. Setting up new software and training staff to use it is a big deal for most businesses. Even a “free” trial can cost them serious money. However, in some cases, “trying” software costs nothing, especially for individuals. For example, I’ve “tried” countless CRM (contact management) apps. It takes ten seconds to log in, look around, and never think about it again.

As always, think in terms of currency. What are they giving up to try it out? If your trial is too “cheap” to try, you can try to increase the cost of it. For example, you could ask to write a case study about them after they’ve spent 2 weeks using it. Or you could get them to promise to try using it with their team for at least a week. If you’ve got a more developed product, you can take their credit card and just charge them nothing if they cancel within 30 days. The more they are giving up for you, the more seriously you can take their validation.

“Can I buy the prototype?”

Great meeting. The best meeting conclusion I’ve seen is the rarely-heard but always appreciated, “Can I buy the prototype?” A product designer was once showing me a brilliant smartphone tripod he was designing. He demo’d the 3D-printed prototype unit for me and I immediately asked him how much it would cost to buy the prototype. He laughed and said he’d gone through about a dozen prototypes already because people kept buying them. That’s a good sign.

“When can you come back to talk to the rest of the team?”

Good meeting. Bingo! If you are selling anything to companies, you’re going to have to talk to multiple people. If they won’t introduce you, then it’s a sure bet you’re at a dead end.

Enterprise sales is tedious, but one of the perks is that you can get really accurate signals like this one quite early in the process. Building consumer products is a lot murkier since the customer conversation process doesn’t mimic the purchase process.

How to fix a bad meeting

The worst meetings are the wishy-washy ones that you leave with neither rejection nor advancement. You are in no-man’s-land and you won’t learn anything until you fix the meeting by forcing a next step (or rejection).

A lost meeting can often be saved by just pushing for a commitment at the end while you’re being brushed off with a compliment.

But don’t be annoying. You aren’t trying to strong-arm folks into handing over their wallet. You are trying to cut through some of the polite rejections and find out if they’re actually going to become a partner/investor/customer.

If they aren’t excited, then good news: you got the information you came for. Assimilate it, decide if it matters enough to change your strategy, and then keep on keeping on. The goal is just to put them to a decision so you can learn whether you’ve found a must-have product and a real customer.

Rule of thumb: It’s not a real lead until you’ve given them a concrete chance to reject you.

Don’t pitch blind

Even once you’ve moved on to more product-focused sales meetings, you still want to start with some open-ended learning to get your bearings. You may know what the market cares about, but figuring out what’s unique about this particular person feels. It will make the rest of the conversation much smoother, increases your chances of closing the deal, and also gives you ongoing learning even after you’ve got a product.

Startup sales meetings too often go like this: You: “We do X. Want to buy it?”

Them: “No thanks.”

Those rejections aren’t helpful. Hard pitching gives binary feedback: you either nailed it or you didn’t. That’s okay when you’re making fine adjustments (tweak this feature) but bad for bigger questions (does anybody care at all about what I’m doing).

Ask learning questions which pass The Mom Test. Then confirm by selling it. This happens over both the life of your company and during a single meeting.

Crazy customers and your first sale

It’s pretty weird that anybody buys anything from young startups. In all likelihood, before the year is up, you’re going to either go out of business, abandon the product, or sell the company. And even if you stay the course, there’s no guarantee you can actually do what you say you can do.

First customers are crazy. Crazy in a good way. They really, really want what you’re making. They want it so badly that they’re willing to be the crazy person who tries it first.

Keep an eye out for the people who get emotional about what you’re doing. There is a significant difference between: “Yeah, that’s a problem” and “THAT IS THE WORST PART OF MY LIFE AND I WILL PAY YOU RIGHT NOW TO FIX IT.” Steve Blank calls them earlyvangelists (early evangelists). In the enterprise software world, they are the people who: Have the problem

Know they have the problem

Have the budget to solve the problem

Have already cobbled together their own makeshift solution They’re the company who will commit way before it makes rational sense to do so. It’s the guy who will give you cash right now from his discretionary budget to run a trial. Or who will fight for you against his boss and lawyers when they’re saying the tech is unproven.

In the consumer space, it’s the fan who wants your product to succeed so badly that they’ll front you the money as a pre-order when all you’ve got is a duct-tape prototype. They’re the one who will tell all their friends to chip in as well. They’re the person reading your blog and searching for workarounds.

We’ve got 2 takeaways.

Firstly, when someone isn’t that emotional about what you’re doing, it’s pretty unlikely that they’re going to end up being one of the people who is crazy enough to be your first customer. Keep them on the list, but don’t count on them to write the first check.

Secondly, whenever you see the deep emotion, do your utmost to keep that person close. They are the rare, precious fan who will get you through the hard times and turn into your first sale.

In summary, after you’ve learned the facts of your industry and customers and designed the solution, you start pushing for advancement and commitments to separate dead leads from real customers.

Rule of thumb: In early stage sales, the real goal is learning. Revenue is just a side-effect.