Focus on ‘Million Dollar Problems’ to Grow Your Startup Faster

Focus on ‘Million Dollar Problems’ to Grow Your Startup Faster

Your startup has built a software product that has “cool features” that actually work. That’s a big milestone for every startup. The thing actually works!

Your customers talk about your product’s features by name and they give you feedback on the user experience. They get it!

Don’t be fooled that it’s just about the features of your product. Your product is just a means of solving a bigger problem.

If you are not clear about what your target customer’s bigger problem really is, you are playing a weak tactical game that will slow down sales and leave the door open for savvier competitors. You’d better be connecting to a really important problem to get any attention or close sales faster in the early years.

For startups that are solving new problems in new ways, understanding this can be the difference between getting those first 100 customers or not. Survival or death.

Is growing faster one of your startup’s bigger problems? I thought so. Gotcha.

Connect to “Million Dollar Problems”

There is a short list of the biggest priorities your potential customers care about and are actively trying to solve. I call these “Million Dollar Problems.”

These problems have the most impact on the most important results of the business over time – growth rate, stock price, revenues, expenses, reputation, product quality, funding, predictability.

When helping other business solve problems (aka sales and marketing), startups should draw a clear line from their product’s features to these Million Dollar Problems. It also pays to help customers deeply understand their biggest problems, since bigger problems are always complex and challenging.

It’s easier to sell the capabilities that people are already asking for, but it’s always better to find out the real reason businesses want to solve this problem in the first place.

Ask deeper questions

Startup CEOs and senior executives are usually more comfortable talking about Million Dollar Problems than their salespeople are. This is why startup founders close sales much better than their salespeople in the early days. They are just having more strategic discussions that uncover the Million Dollar Problems and connect them to their product.

Startup founders, marketers and salespeople need to ask deeper questions to uncover and connect to Million Dollar Problems, like they are mining for gold. These insights are needed to craft your product, improve marketing messages and strengthen sales conversations.

Here are some useful questions that everyone at your startup should be asking to to help you find and connect to Million Dollar Problems:

  • What are you really trying to solve here? Why is that important to you?
  • How can our software help improve your revenues/expenses/stock price/etc.? How can we help you create even better results?
  • What’s happening in your industry right now? Given those issues, what are the biggest challenges you face in your business?
  • What’s the most important result that your boss or the CEO wants to see from this solution? Why?

The hyper-growth magic trick

Once you are clear about the most important Million Dollar Problems your product solves, there is one more element of the hyper-growth magic trick:

Only go after the 10% of companies that already have the Million Dollar Problem you solve. Ignore the rest.

For 90% of your potential market, it’s just a “thousand dollar problem” that they can ignore for now, not a Million Dollar one that requires serious action. You’ll waste all your precious resources and time by going after customers who don’t care intensely about solving the problem.

In the product adoption lifecycle framework, this is the key characteristic of the Early Market buyers. These folks aren’t people wearing t-shirts that say, “I am an innovator, please sell me something half-baked.”

The Early Market buyers are simply the few adventurous buyers who know they have a serious Million Dollar Problem and are resolved to do something about it right now. Why else would they buy an imperfect early product from an uncertain company?

Find the Million Dollar Product your product solves; then focus only on the few potential customers who have this serious problem.

This often takes startups a few years to learn the hard way. I hope you can get there faster.