The dust settles, and your three-to-six month journey through your startup accelerator program has concluded. Presumably, at this point, you have some sort of MVP, or minimum viable product, which you have used to secure some seed funding (at the very least, the accelerator has given you some great strategies to hit the street to secure your first round of funding). They send you out into the world, alongside your cohorts, filled with ideas and tactics on making it big. It’s truly a whirlwind: you have your company idea, you have your MVP, you have (or will soon have) your funding. But the big question still remains:
Accelerators have become an incredibly popular route to market for burgeoning startups. After Y Combinator first opened its doors in 2005 (and TechStars in 2006), the number of seed accelerator programs in the US has grown by 50% each year. That comes to roughly $19.5 billion in funds raised in just over a decade to more than 5,000 companies.
Considering that some accelerator graduates include companies like Dropbox and AirBnB, it’s unsurprising that the seed accelerator has become a desirable path to market for many entrepreneurs. And while graduates of Accelerator programs are generally faster at hitting key milestones in business development when compared to similar non-accelerated companies, they’re also much more likely to fail at a much faster rate. I think Lao Tsu was the one to say, “The flame that burns twice as bright burns half as long.” I’m sure he was talking about startup companies in 2018, no doubt.
The truth is, as an entrepreneur and recent graduate of an accelerator program, you could take your company in dozens of different directions, and start a dozen different initiatives to find some sort of foothold. But, from working with a number of accelerator graduates, we’ve found this list of the things you must accomplish to be pretty reliable. Is this list all-inclusive? Definitely not. Will it get you going in the right direction? I hope so!
1. Confirm Your Market
In the simplest terms, a business exists to solve a problem. Once you’ve graduated from your accelerator, you’ve hopefully identified the key problem that your business solves. Need cloud file storage? Dropbox. Need an alternative to hotels while traveling? AirBnB. Even if you don’t have a full-fledged solution yet, your business has likely given an answer to someone. Now, it comes time to see if this solution scales. Now, we know that as a business owner, you’ve thought about these questions a ton. However, it never hurts to reexamine every so often:
- What is your market?
- Who is in your market?
- How big is your market?
- Are you solving a problem for a big enough market?
Take a look at that last one. At this phase, right out of the accelerator, it’s crucial you give yourself an honest answer here. Because truly, if your product solution is too specific, or if you’re offering no new spin on an existing solution, your company will have a difficult time actually growing. You’ve solved a problem for someone, but is that group of someones going to be big enough to grow?
If you find that your market simply isn’t big enough, it’s time to pivot. Reexamine your market, and you may find that a much bigger and stronger audience could be just to the left or right of where your business currently sits.
2. Identify Key Metrics
Alright, we know that every accelerator program emphasizes the importance of metrics to their graduates. Before you start hammering away at building a customer base, you have to give yourself a few ground rules to play with. Specifically, how are you going to measure success for your business? What metrics are you going to look at? As any business-savvy data hound will tell you, the number of data points you can make to extrapolate relative success for a company are diverse and nearly endless. How do you know which numbers are most important to your business?
Of all the KPIs you could potentially track, two tend to stand out as the most important for any business: CAC and LTV. Your CAC (Customer Acquisition Cost, or COCA, cost of customer acquisition) and LTV (Lifetime Value) will tell you exactly how much you are spending to get someone to sign on the dotted line, and how much monetary value you can expect from the average customer. You may find your CAC to sit around $1,000, which at first glance seems high, but if your average LTV sits around $25,000, your CAC seems much better.
But what about beyond CAC and LTV? It’s largely going to depend on your business. For eCommerce solutions, cart abandonment rate or average order size may be crucial to understanding the health of your business. A SaaS company will likely look at the number of active users and churn. Product companies need to have a handle on the number of repeat customers and revenue growth rate. Again, it’ll largely depend on the type of business you run, but putting in the time and effort early on in developing systems to capture these KPIs will save you a lot “Are we actually successful?” questions later on.
3. Create, test, and verify personas
We talk about personas here at CleverFunnel, because we firmly believe that having a handle on who makes up your market is crucial if you plan on actually marketing to these people. For us, this goes well beyond identifying what sorts of job titles these personas hold, or where they spend their time online. We like to consider their personalities, their hopes, their dreams, their fears. We find that building personas helps you remember that your product is designed for people, and your marketing is going in front of actual living and breathing humans. You aren’t selling to data points. You aren’t selling to “leads.” You are selling to actual people with entire life stories, and your product is designed to make their life easier in some way. Great. Now, who are they?
At the outset of your business, you probably had a handle on at least one major persona for whom your business is designed. In the case of AirBnB, they may have started with serving young and adventurous types who want an authentic, local experience. However, it’s rare for a business to have only one potential use case. What about thrifty people looking for cheaper accommodations? What about business folks who are sick of stuffy hotels that all look the same? How about people looking for extended stays, who may want an actual kitchen to cook in?
It never hurts to frame your business differently depending on the use case. Will all of your developed personas be winners? Probably not. During this phase, however, it’s your job to find your strongest personas and rule out the weak ones. Who knows? It may be different than what you initially expected.
4. Develop and test emotional drivers
Speaking of humanizing your audience: even if your business sits squarely in the B2B realm, it’s very important to remember that your prospects are all humans, with very human needs, wants, and desires.
Make a list of every emotional or logical drive that might draw someone to your product or service. For instance, for AirBnB’s jet setting millennial persona, a sample list of drivers could include the following:
- Fear of missing out
- The desire for adventure
- The desire to experience something new
- The need for authentic experiences
To fully understand your audiences, you need to understand what brings them to your company in the first place. Test these drivers against one another to see what resonates most with your audience. Through your testing, you may find that your initial branding completely missed the mark, requiring a bit of a pivot.
5. Hammer Out Your Messaging
The process of finding a great piece of copy usually involves testing 100 pieces of copy that are absolute garbage. Once you have an idea what your strongest drivers are for your strongest personas, it’s time to get creative.
Test copy, then retest copy, then throw it all out and retest it all again. Once you’re happy with the results, try something new. What messaging really speaks to your target audiences? Is there a line of text that absolutely tells your story the way you want it told to your audiences? What is getting people to click? What is getting people to convert?
6. Figure Out Your Channels
To put it simply: sooner or later, you need to figure out the best way to get your product in the hands of your target audience. How are you going to get it to them?
The path to a consumer can take a lot of different shapes, and, again, it all depends on the product or industry you’re in. For most companies, direct sales makes a lot of sense. However, some other channels may include affiliate marketing or channel partnerships. Keep in mind, thinking through this now will save you a lot of time and energy down the road. It’s a whole lot easier to dive in with a channel partnership model from the getgo than it is to pivot to one six months from now.
What platforms are you going to be on? Does AdWords make sense for your company? What about Facebook? Where do your target personas spend their time on the internet? Constantly test and retest conversion path and buyer journies. What is going to provide the highest quality prospects for the lowest amount of money? Once you’ve figured that out, you’ll probably have to adjust again. That’s just the nature of digital presence.
7. Build your marketing stack
What are the systems and components you are going to use to get the word out about your company? Effective digital marketing requires quite a bit of technology to effectively get your business in front of the right people. Consider the following list of needs that need to be answered one way or another through technology.
- An analytics and reporting platform: Can you accurately keep track of your metrics and KPIs?
- A CMS to develop web content for your website: How in-depth are your website needs?
- Ad platforms for various channels: If you are into rapidly testing messaging and personas, do you have an ad platform that allows multivariant testing? Do you have an ad platform for each channel you’re running ads on (PPC, paid social, remarketing, etc.)?
- A marketing automation platform: Once someone is in your funnel, how are you going to keep them in the loop?
- A CRM (yes, this is totally part of your marketing stack): Are you able to organize your leads and prospects by lead source, so you know the ROI on any given campaign?
8. Develop Your Content Strategy
The world of digital marketing today is defined by high-quality and original content. Every company needs to prioritize content for their own brand, regardless of industry or target audiences. Keep in mind, this is a whole hell of a lot more than just “let’s write on the blog every so often.” No, you need content that actually speaks to your audience, and delivers exactly what they want to be reading.
- What pieces of content do your prospects need from you to optin to the sales process?
- What pieces of content will help your sales team generate revenue?
- Does a blog even make sense for your target audiences? Is that the type of content they like to consume?
- Identify your premium content. What is the cornerstone pieces of content that people want from your company? Is it valuable enough to your prospects to trade their contact information for?
Content has quite a few benefits, from improving a site’s SEO, to increasing funnel velocity for qualified leads. It also gives companies a chance to demonstrate their thought leadership, and connect with their prospects.
9. Build a Conversion-Based Website
It’s true, a lot of people prioritize developing a website early on in their development. And yeah, it’s absolutely true that you need some kind of website in order to secure early rounds of funding. But after all of these other steps, you’re probably ready to build out a conversion-based website.
Through taking deep dives into your personas, your drivers, your messaging, your channels, your offerings, and your market, you’ve (hopefully) learned a lot about your company and its relative position within your market. Allow this to translate into a website that generates the conversions you’re looking for. Through this process, you’ve learned who your prospects are and what they want. Build your website for them, because they’re the ones who are going to keep your grand idea for a company afloat. Will a conversion-based website look different than what you initially put in place? Probably. As a matter of fact, it’s likely that your website will become an ever-evolving piece of digital property as trends and preferences change. As we all are too familiar with, when it comes to digital marketing and web presence, your work is never done. Strap in.
10. Identify a Growth Partner
Alright, I know. This section may seem to be a little self-serving, because what I’m essentially telling you to do is to go out and find a growth marketing agency to help you through this growth phase. Sorry, not sorry.
As you may have noticed, at growth-stage companies, things feel like they’re moving 10,000 miles per hour, and marketing is no different. While it’s completely valid to hire on a marketing professional to your team, the avenues that a company needs to explore immediately after graduating from an accelerator program are vast — oftentimes too vast for one single person to explore alone.
Consider a growth marketing agency as a team of bloodhounds for your company. Any growth marketing agency worth its salt will be unafraid to move down numerous paths at once to sniff out what’s working, and to quickly pivot away from what isn’t. The unfortunate reality for early startups is you’re going to be up against the clock almost immediately. Sure, you have your seed money, but that ain’t gonna last. You need answers, you need strategy, and you need them fast.
You either need to decide what vendors you are going to use to work various sections of the sales and marketing funnel, or you need an agency that will deliver a full-funnel solution. Luckily, I happen to know of one that does the latter. Holla.