According to Investopedia startup is defined as a newly established business.
In today's world, we push the definition to assume that the newly established business is focused solely on seeking new ways of doing things. That everything they do and touch has to reinvent the wheel—a cardinal sin.
Therefore, a startup is just a young business and must take account of the five parts to any deal.
Opportunity. Also called the need, the pain or the problem that a customer is looking to solve. It is incredible how my times this is glossed over or skipped entirely. Interestingly, identifying opportunities does not need an empirical science degree. One of the best places to hunt for opportunities is on social networks. You can do so as you are procrastinating in filing your tax returns. E.g. find popular how-to videos on Tiktok and Instagram and productize the solution at scale.
Lead. An opportunity is from the majority vote. It does not know the persona that has such a problem. That is why a lead conversion comes in. Lead conversion breaks down an opportunity to identify the specific individuals who face the problem. For consumer goods, it is best to draw up the persona likely to have the pain then break it identify the B2B channel that is likely to sell the solution. E.g. via Amazon or the AppStore. Once you convert it to a B2B conversation, the rest of the dominos fall into place. You might not have necessarily contacted the lead at this stage. Once you identify the lead, you can assign solutions to the needs that perfectly fit with the lead. This task is a trifecta task. Attempting to find solutions without first identifying the lead is costly. 50% of startups die at this point.
Quote. Congratulations, you have successfully made it to step 3. The quote level requires business acumen and research, though. The biggest pitfall at the quote stage is not only leaving value on the table but also failing to account for unforeseen circumstances. Simply covering your costs is not enough. Production delays could eat into your margins.
Contract. Place the champagne bottle on ice; you have almost made it. Money is almost in the bank life if looking good. Your negotiation expertise will need to shine here. If negotiations are tough, consider using the intrinsic values that you might find cheap to produce but add value to the overall contract: e.g. 27/7 support or a cooling period. Ensure that these intrinsic values do not cost beyond the quoted numbers. The rush to close out a deal can easily lend a bad hand.
Order A quote and a contract turn into an order. The customer has agreed to purchase your solution or product at specific terms. They might as well have gone ahead to pay for the goods and have also indicated where and when they need the goods delivered. The order is simply a summary of it all.
Pop the champagne and call the local news to witness your genius. Repeat these five stages, slowly innovating and improving them.
January 19, 2023
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