On the heels of my earlier post on questions "entrepreneurs should ask themselves," I got a flurry of emails from readers about other points that I did not address. Anyway, I strongly believe that we can sometimes get too enamored with our own technology and not do enough market assessment in the real world. Later this week, we are actually going to have a strategy review at one of my portfolio companies and these are the questions we are asking ourselves:
- What is our unique value proposition to customers? Is it truly unique and differentiated (come on-we need to be brutally honest with ourselves here)? If not, how do we leverage our strengths to create a compelling value prop to customers?
- Who do we want to be when we grow up? In this world, I strongly believe that one must put a stake in the ground and either go big, go niche, or go home. Which one are we and why?
- Where is the market headed? What are the opportunities - are we a leader or follower? If we are a follower, how do we become a leader?
- Given all of the above, what are we uniquely positioned to deliver given our strengths and weaknesses? What are the biggest threats that keep our company from delivering?
- How are we going to reach that customer at the highest point of pain and in the most capital efficient manner?
As one of the entrepreneurs in the portfolio pointed out, some of these questions can be theoretical and murky and until you get a product out into the hands of customers or consumers, it may be hard to answer them. My perspective is that yes this is true, but you need to have few of these basic questions covered before going into the market and then with the data take a step back and refresh, rethink, and reload. In other words, you need to take market feedback to validate or invalidate some of your initial thinking and adapt. I know these are all basic questions but you would be surprised at how many people come in and have not put their mind to some of these questions.