Customers > Product

Stop doing it backwards.

Since doing Techstars last year, I’ve had a number of conversations where I get asked for advice on how to get into Techstars (or, really more commonly, Y Combinator).

Usually it goes like this: here’s my product > what do you think? > is it good enough to get into YC? That’s good. A maker’s mindset is good. But they almost never talk about their customer relationships. That’s backwards. So I ask them this one question:

“Which would you rather have: customers or a product? Pick one.”

The correct answer is: customers.

Think of it like this: say I came to you asking for $50,000. I showed you a beautiful, fully-functional product. I have 0 users, but I know people want this. Now say someone else showed you no product, but a list of 100 people who gave them $10 in return for the promise they’d build a product to solve their problem. Who would you fund? You’d fund my competitor of course, because they proved people want what they’re offering. They have validation, and a much better chance at growth. They’re building for a market.

Investors (YC, Techstars, angels, VCs) care about the same, one thing you should care about: growth.

Growth comes from building something people need, telling them about it, and getting them to use it, repeatedly. If you can get customers before building a product, that’s immediate validation, which is a huge advantage.

That’s worth saying again: get customers before you build a product.

I’m not saying you can get into YC without a product, but I am saying you have a better chance if you at least demonstrate need.

If you find yourself with a product already and no customers, that’s OK. Pause development — now go and find customers. Tell them what you’ve built, get them to use it, and focus on growing. Better late than never.

Header image © Nevit Dilmen CC BY-SA 3.0 or GFDL, via Wikimedia Commons.