Platt Perspective on Business and Technology

Creating a unique value proposition – looking past the cliché and the hype

Posted in startups by Timothy Platt on September 15, 2009

One point that is driven home in most discussions about startups is that if you want to succeed you need to be the best, and ideally with a new approach, a new idea and a new product or service that others cannot readily match. This is true – no one is going to succeed in building a successful new business to be the 37th best in a local field of 50 and it is probably not a great idea to simply build a minor, evolutionary upgrade to an existing product or service in a shrinking market.

The problem is that the idea of creating a unique value proposition can easily become a buzz word masking vague hand waving and convoluted explanations. My experience with failed startups has pretty much always been highlighted by a failure to clearly define and explain who and why that new product or service is in fact a new value proposition. So I would propose a simple test to see if there is real substance that can be built on behind the proposal to strike out and build a business. The people building it need to be able to explain what they are doing and how it is unique, and do so within the constraints of a short version elevator pitch – preferably in one or two simple declarative sentences. I will add that they need to be able to do this in simple, non-technical language and especially where their proposed product or service is highly technical as they will need to be able to explain it to people outside of their areas of expertise. This includes potential outside backers and investors if they take that approach and seek out angel or VC support but it is even more important way before they reach that stage in developing their team, setting goals and priorities and just getting organized and started.

The hallmark of the ones I have seen fail is that they have never fully clarified what they are setting out to accomplish at this level, and if you do not know where you are going, you are probably not going to get there. So plan with this central, organizing focus and make sure you can articulate it to others so you can get feedback and validation from their understanding and valuing your uniqueness.

No, this does not mean sharing your vision with the world, and I am aware of the limitations of non-disclosure agreements. But be sure you know how to clearly, succinctly describe and explain your business and your product or service to be sure you have one.

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  1. […] Posted in startups by Timothy Platt on December 9, 2009 I wrote in an earlier posting: Creating a unique value proposition – looking past the cliché and the hype about the need for focus and clarity, and the ability to compellingly articulate the startup’s […]

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