Founders often ask what they should prioritize early in their lifecycle. For example, build the product out or try and sell what has already been built.
This prioritization becomes even more important as the next fundraising milestone approaches. To help shed light on this I ask founders a few questions:
What can they control?
What takes the most risk of the table?
If the startup relies on large integrations with enterprise customers, they cannot control a change in their priorities or delays on their end. They cannot control the delay or issues of a key third party software integration.
Early on, showing there is a demand for the product is key. This is a hard one for many early investors to validate on their own. It is far better to have a user base that is growing but clamouring for new features than having fewer users and a big product release on the horizon that “might” result in higher adoption. The user feedback loop is critical.
This isn’t an all or nothing approach either and usually a balancing of effort. It is up to the leadership of the startup to prioritize. An easy way to this is to ask how you want to portray the next round.
We have shown there is demand for the product and are raising capital to add some key features, and increase our sales and marketing in areas we have already shown work.
We built the first version but need to make some more changes before we get any customers on the platform.
These days, the technical risk is pretty low. Generally, the product can be built. The real risk is on adoption and execution. It is best to take that risk off the table as quickly as possible.
Photo by Peggy Anke