The Bowery Capital team had a conversation with Brendan Berry, a Director of Product Management at Ripple, centered around the current state of cross-border payments and what the blockchain-powered future means for international payments.
Hooli is about people. Hooli is about innovative technology that makes a difference, transforming the world as we know it. Making the world a better place, through minimal message oriented transport layers. I firmly believe we can only achieve greatness if first we achieve goodness.”
– Gavin Belson, CEO of Hooli, Silicon Valley Episode 1
Wait, what? We’re weeks away from the start of Silicon Valley Season 4, and I have a confession to make: I still have no idea what Hooli does. While Gavin’s intentions here sound good (kind of), I’m not particularly inspired by “minimal message oriented layers,” and I don’t know what problem they’re trying to solve, and for whom. Gavin is likely a smart man though (ok, maybe), and similarly, there are many intelligent entrepreneurs who have an excellent idea, but struggle to unlock the full value of it through solid pitching and clear early messaging.
So how does one pin this down? Let’s take a look at 5 keys to creating your early product pitch.
Who is your product for?
Speak to your audience directly. Even if you’ve done a good job prospecting your potential client ahead of time, you need to make a connection with whoever is on the receiving end of your pitch. This starts with identifying who it is that your product is meant for and quite literally saying that. When you hop on the phone, construct your deck, or create your landing page, you need to say something like, “Our product does X for CTOs, Product Managers, and Lead Engineers, who are facing challenges with Y”. By addressing this early on, your prospect will listen more intently. It’s the equivalent of addressing someone by name in a crowd. We’ll get to the “X and Y” of that statement in a moment.
Social Proof: Who else uses your product that I know?
As the psychologist Robert Cialdini cites in his book “Influence”, using “Social Proof” makes the connection between you and your audience even stronger. That said, once you have the names of other similar companies using your product, you should insert that into your pitch, too. Why? Because similar to speaking to your prospect directly by title and name to boost reception, you’re now using their peers and competitors to signal that your product is for them, and they should listen up. Furthermore, the prospect tends to think, “Ah, another company I respect in the industry has already vetted this and also relies on it to propel their business, that makes my decision easier.” Ultimately this will reduce the time this prospect will spend in vetting your product for their own company.
If you don’t have customers yet, that’s ok. “Social Proof Yourself” and build credibility by talking about your background, who you’ve interacted with in the past, and why you’re an expert in the space who has knowledge that’s worth hearing. Which leads us to our next point.
What’s the problem you’re solving and how?
You might be saying to yourself, “we’re solving a problem our prospect might not be aware of, or one that’s bigger than they realize,” and if that’s the case, then build them a bridge to that problem so they understand it. Keep in mind, you’ve potentially spent years developing your thesis and the pain point you’re solving for, and now you only have moments to convey that to someone else. Psychologically, people grasp problems in a variety of ways, so here are few succinct ways you can outline your problem to help them understand it:
Quantitative: “Today’s companies pay $5000 to onboard each employee and face 100% yearly turnover in their employees who focus on X. Our solution, on average, helps to cut that on-boarding cost in half, while boosting employee satisfaction and therefore reducing turnover by an average of 20%”
Qualitative: “According to the the Employees of America Survey, hiring managers have cited high on-boarding costs and maintaining employee satisfaction as the top two ranking concerns in the first year of a new employee’s tenure. We seek to alleviate those concerns by providing Y”
Sense of Urgency: “With the rise of millennials in the workplace today, turnover rates are at an all-time high, and recruiters are excited to sweep them away from you. Our solution drasticly improves retention rates immediately by providing Z, at a time when that’s keeping hiring managers up at night.”
Comparative: “Once thought of as innovative benefits to increase retention, 401k’s and gym memberships are now staples of an employee’s package and on-boarding. Similarly, we believe our solution will be the next HR-innovation that solves your retention challenges and boosts employee satisfaction.”
After outlining the problem, highlight at least three tangible examples of how the product works to solve these challenges. If you use a pitch deck, be sure to build it so that these use-cases can be swapped out, depending on the industry or persona you’re pitching to.
Why you and why now?
It’s not enough to identify the problem and pain point, because there are lots of problems organizations are facing, and lots of smart groups trying to solve them. Now that you have someone’s ever-fleeting attention, focus on your differentiators, knowing that they’re likely comparing you to other solutions they’re familiar with. There are a few questions to ask yourself here.
- Are you solving for a new problem on the rise? If so, then highlight that, and focus on the fact that you have years of domain expertise that make you unique in coming up with a timely answer here.
- Are you solving for an existing problem with new technology? Great, you should focus on why your product trumps legacy solutions and any first-mover advantages you may have with your new solution.
- Are you consolidating multiple products your prospects currently uses, and therefore offering them a more efficient solution that’s going to save them money? This is good too, especially if there’s a high switching cost for prospects to ditch their current products in favor of yours. In this case, every day they spend with their current solutions is a day lost saving money and creating efficiency by using yours.
Ultimately, the goal here is to find your specific edge to highlight the question of why you versus someone else, and why the time to solve the problem is now.
Be a good storyteller. Bring vision into your pitch (especially if you’re a founder).
Storytelling is one of the oldest forms of human communication. It unifies people around a commonality, through good times and bad. Your story (to a potential customer at least) should not hint that there’s a big market opportunity or a lot of money to be made (by you). The customer does not care. Make your story personal and relatable. Perhaps you’re seeking to solve the problem because you came from the industry and it was a huge pain in your own life. Maybe you have an altruistic vision (assuming it’s real, don’t fake it) for coming up with a solution that will make people smarter, and therefore happier in their day to day work. That’s something we can all get behind. People generally don’t like being sold to, but if they’re sold on you, your story, and the vision along with it, they’re more likely to ride with you. As one of my favorite product managers once told me, “It’s easier to cancel a product than a relationship,” and the beginning of establishing that ironclad relationship with your customers starts here. (Hint: this applies to rallying your internal employees, too).
In summary, the keys to creating your early product pitch are comprised of the following: 1) Who your product is for, 2) Social proof 3) What problem you’re solving and how, 4) Why your company specifically is going to solve it now and 5) A story or vision which ties all that together. Finally, ask for, and listen to your early prospect’s feedback on the pitch, and iterate. If Gavin Belson had followed these steps, I doubt Pied Piper would be the thorn in his side that it is today.
If you liked our 5 Keys to Creating Your Early Product Pitch & Story and want more tips on how to scale your team, check out blog posts from the Acceleration Team!
Bowery Capital and Balance explain how B2B marketplaces can think about payments.