In this blog article, we will cover the most important steps for SaaS founders to win the first 10 paying customers. So in case you are an early-stage start-up founder and face the challenge of how you can find and win your first customer, this blog article is for you.
Solve a real problem
A common mistake I see over and over again is that founders develop a product/solution for a problem which might exist (or might not exist). Don't develop a product without understanding the real problem of your potential customer. This means before you actually build a product, take your time to talk to your potential customers, understand their specific problem and evaluate together with them a potential solution.
So instead of building a product and then trying to find a customer group who is interested in such a product, start with a well-defined problem from a specific target customer and build a product/solution for them.
If you solve their problem, you create value for them, which means they are your customers and willing to pay for it. This means you found your first customer!
Start with strategies that do NOT scale
Most start-up founders want to have scalable sales and marketing strategies in place straight from day one on. They love the idea of having a scalable customer acquisition strategy (nice paid ads on Google, Instagram, or Facebook, plus a nicely designed landing page followed by a self-service SaaS product) and hope they don't need to talk to the customers, onboard them and do some time consuming manual work. While this is the desired strategy later on and should be the objective for start-ups who’ve found product-market fit and focus on growth, I would highly recommend starting manual hand recruiting your first 10 customers by doing stuff which do NOT scale (e.g. Outbound Sales, phone calls, emails etc...).
Preferably you start with customers you already know personally or are within your network. In case this is not working for you, I would suggest you start manually outreaching to your specific target customer.
Here are some potential strategies for you:
- Direct Messages via Linkedin, Facebook, Instagram (depending on your target customer)
- Outbound Email (with some Email Sequences)
- Outbound Phone Calls
- Social Network Groups (e.g. Facebook Groups or LinkedIn Groups)
For all those methods it’s crucial to have a well-defined target customer persona.
Be human and don’t sell your product in the first step
A lot of inexperienced founders or technical founders think they need to have the ‘perfect’ sales pitch and just use a template to win the client. My experience is the more natural and human you are in your cold outreach the more successful you will be. Don’t use sales scripts, show up as a human and personalize your message to each potential customer. Don’t sell your product in the first step, rather spend time with the customer, ask questions, understand their specific situation and challenges, and then (in case the customer is qualified) try to sell your product and win the deal.
Find customers, who love your product
As described in the first paragraph, in an ideal scenario you've already done interviews with potential customers before you've built the product. This means, just follow up with them and show them the product. The chances are high that they love it and want to be your first customer. Depending on your product, it could also make sense to sign LOIs with those customers before you start building the product (mostly relevant for B2B Enterprise SaaS). You should aim to find first customers who really love your product and see high value in it. Don’t make the mistake of onboard hard customers or just anyone who is interested but does not fit your target persona (more Infos in the following sections). And don’t underestimate the extra motivation boost you’ll get if your first customers love you and your product and give you positive feedback.
Avoid hard customers
If it's getting hard for you to win your first customers, this is a strong indicator that you most probably do not really solve an existing problem for your customers. This means go back to step 1 and start iterating.
Qualify your customers - don't sell to every interested prospect
How to make sure that a prospect is a qualified customer?
Actually declining interested prospects can help you to focus on the right customers. Oftentimes I see start-ups being super happy about every single prospect interested in using their product. I would highly recommend qualifying your prospects to make sure you only serve the right target group. A good way to do this is to ask prospects 3-5 qualifying questions - depending on their answers you can easily decide if those are the right fit or not.
Charge your first customers
A lot of times I see SaaS founders offering their software completely for free as they hope to grow faster without charging their customers. As this could be later on an effective sales/marketing strategy, I would highly suggest charging your customers from day one on. Otherwise, you do not know if your customers really see value in your product and are willing to pay later on for it.
My recommendation is: 'Charge your client in order to solve their problem' - if they only want to use your product for free this is a strong indicator that the problem is not big enough for them.
Ask for referrals
When you’ve closed your first customer, ask them for referrals. The chances are high that they know other potential clients within their industry, who face similar problems and would be the ideal customer for your product. It is totally fine to do that, so don’t hesitate.