Sell Yourself

I met with an entrepreneur this week who is building a web service that tackles a very big problem. In his case, there are diverse customer needs. Every customer needs something slightly different. One of the big challenges will be to come up with a standardized set of requirements that best fits those needs. The other challenge is to satisfy them in an easy to use, compelling web service.

The entrepreneur himself has clear expertise in the space. He undersands the market pain because he lives it himself daily. What he lacks (like everyone who's just starting out) is capital and resources.

When you're tackling a big problem, you either raise lots of capital to pay for the time and bodies needed to solve it, you break the problem into smaller chunks and tackle a portion of it, or you give up. It was clear to me that this business was not investor ready. Raising lots of cash was not a possibility. He could have just tackled a portion of it, but I thought there was another way: selling himself.

Because of his expertise, and because of the complexity of the problem, my recommendation to him was to go into the market and sell himself with his product. i.e. offer a consulting service that is wrapped around his technology. This allows him to gather lots of customer feedback, refine his approach around a particular segment and get paid to build a better product and a company which he still owns 100% of.

Over time, he will likely end up with a very complete product that has been tested with real customers. He will also know who really needs this product. He can then continue down the technology enabled services path (i.e. consulting and product together) or transition to a product only company. At that time, he'd be in a much better position to raise whatever capital he needed.

So, consider this approach for your startup idea. Can you sell yourself along with your product as a way to bootsrap, do customer development and build a much stronger story for whenever you do choose to raise capital?

Thanks to StartUpCFO / Mark MacLeod is a Partner at Real Ventures, Canada's largest seed investor.