How to Make Your Startup Valuable
For startups to succeed, you need to have a strong foothold at finding a favorable niche, your value proposition, within the market. One of the best ways to achieve this is to involve customers even at the onset of product development. Generally, businesses tend to perform better when they create a business model that answers customers’ needs first. Value creation identifies and aims in making a positive impact on your customers.
According to Dictionary.com, the word “value” means:
- relative worth, merit, or importance: the value of a college education; the value of a queen in chess
- monetary or material worth, as in commerce or trade: This piece of land has greatly increased in value.
- the worth of something in terms of the number of other things for which it can be exchanged or in terms of some medium of exchange.
- equivalent worth or return in money, material, or services: to give value for value received.
From its meaning, we can say ‘value’ is an abstract concept. Whether in business or personal lives, our decisions and course of actions are driven by the value we gain from it.
At the core of every business is discerning what value means to customers. In that way, you can create and provide it to them. Implement value creation by improving existing products or services that will significantly make customers’ lives better. However, as businesses grow in complexity from its startup stage into a large enterprise, the gap between customers and the company increases consequently.
In most cases, the gap is extremely wide that customers then become faceless numbers on the balance sheet. When this happens, customer value is reduced to a lofty concept that’s tossed at the back burner.
Focus on creating value for customers
To shorten the distance between customers and employees, businesses should see it through the perspective of value. In other words, you must position your products or services to focus on addressing customers’ problems. You innovate to solve problems. Whatever you are offering is not valued based on the product (or service) itself, but the benefit your startup provides.
Checking online would give you a list of all valuable startups. Here’s a specific example; Quickbooks is Intuit’s accounting software product for small and medium businesses. Their customers don’t subscribe simply for the chance to use the product.
The real value for them is the ease and convenience it brings when accepting payments, paying bills, tracking sales, profits, and expenses, and managing payroll functions for their business. A solid business model focuses on creating customer value rather than the ownership (or lease) of a product or service.
To provide value, let customers be the top priority
While product design, sales, marketing, and supply chain management are important, your top priority should be whether any changes will benefit your customers. Focus on the value proposition of your startup.
What good does a new product design offer if it doesn’t bring any actual value to customers? Valuing customers first is always a winning strategy for companies.
Value lets you stand above the competition
To survive against the competition, aim your business in terms of value. Customers won’t have any reason to switch to other competitors if your product provides something they value. From a customer’s perspective, a high-value product or service will sell itself.
Make Value Creation a fundamental pillar of a startup
Startups and SMEs (small and medium enterprises) are better at recognizing the concept of value creation since their size allows them a better interaction between management and customers.
The downside is that once companies surpass the startup phase, they tend to neglect value creation. The reason could be that some startups focus their strategy on survival and transition to the next stage, (IPO or mergers and acquisitions) rather than building their business model based on value.
Determine sources and drivers of value creation within your company and industry
Pinpoint the areas that create the utmost value for your customers. So, if your customers value timely delivery and excellent quality, then use the right skills, tools, processes, and systems to develop and deliver the product and service your customers will find valuable.
Long-term Success with Value Creation
Every successful startup develops something of value. The market is rife with opportunities to make people’s lives better. So, your job as a business is to identify and provide these opportunities to them.
Long-term growth and real value creation happen when companies design products or services that offer compelling benefits to customers. To sustain industry leadership, companies should maintain a sustainable value creation process.
If you need help with driving the most value for your customers, we can help you with that. Here at Full Scale, we make it easy for startups to get their business ideas off the ground. You can count on our founders, Matt DeCoursey and Matt Watson to show you the ropes towards making value creation an integral part of your company. Get your free consultation today.