Strategizing for startups

How to think before you act when it comes to marketing for your company

The concept is simple: Think before you act in marketing. Getty images

If there were a joke about how entrepreneurs treat their marketing — and there totally isn't — it would go something like this.

An entrepreneur walks into a bar. Before the bartender can ask, the entrepreneur says, "I want a drink and I need it ASAP."

"What type of drink?", the bartender asks, motioning to the hundreds of bottles behind him.

"I need a drink that is refreshing, doesn't make me too drunk and makes me feel like I'm getting my money's worth."

The bartender begins listing drink after drink, and the entrepreneur, sometimes sampling the drink, turns each one down.

At long last, the entrepreneur climbs behind the bar, grabs a glass, pours in some ice and soda water, and takes a long sip.

"This is exactly what I wanted," the entrepreneur proclaims, "Why didn't you offer me this in the first place?"

The moral of the story? When it comes to marketing, entrepreneurs tend to know exactly what they want, yet they focus on quenching that immediate thirst, not knowing why they're in a bar in the first place.

The idea of your first step is nothing compared to the reality of your second. You can know something but applying those principles to starting and/or running your own business can be difficult.

When we (yes, I'm an entrepreneur too) look at marketing, we often confuse tactics with strategy. I see a problem and immediately need a tool to fix it. Hanging a picture? Where's the hammer?!

While it's tempting to lead with the tactics (i.e. website, brochure, display ad, video, etc.), they can be misguided. This can drain precious resources. Strategy can inject purpose into everyone's mindset.

Marketing efforts must be considered a sequence of events that, when lined up in the right order, produce results that are repeatable, more effective, and can lead to a predictable type of profitability.

Where careers rise and fall is the accuracy of any particular strategy. Since we're talking about accuracy, let's use an archery metaphor. Sure, you can consistently hit a target from five feet away. The farther away you get, though, the more you have to consider crosswind, the arrow's trajectory, and your own focus in order to hit that bullseye. And that's all part of a process of whittling down the variables you don't know or can't control.

It's the same with marketing. The more time you've spent preparing, studying, testing, and strategizing, the more often you will accurately target that bullseye.

Where a lot of entrepreneurs also miss the mark is not clearly understanding the core business issue. If you're lost in the forest (and it can totally feel like that sometimes), you're supposed to be quiet when hunting for food but you supposed to make a lot of noise when trying to get rescued. That's what mixing up a core business issue can do. As a process where you're whittling down the variables, marketing is a sequence, like this:

Graphic from Jarred King

Seems simple enough, right? But the process itself is dependent on the intangible pieces in between the steps. This is what happens between the "knowing" and the "doing." So, the above graph should really flow like this:

Graphic from Jarred King

Usually, the typical entrepreneur prefers to start with step four and just "get sh*t done." The problem with this approach is that it can either be the wrong solution (you're hunting with a rock instead of an arrow) or the wrong effort (you're staying quiet when you should be hollering).

The difficulty here is that the desired effect doesn't happen overnight. It rarely solves "today's problems" today. Even worse, it might require a larger investment. Without fundamentally understanding your business problem, any solution offered will be less effective, more expensive, and more wasteful of time and resources.

Instead, simply start with the business problem and then follow the above sequence to leverage "the doing" part in order to develop "the knowing" part. This doesn't have to be a drawn-out process, and there are a ton of free resources available online to help conduct your own research, analysis, and planning.

Ultimately, I'm saying "think before you act." It's not difficult to understand. The challenge for entrepreneurs is that they are faced with hundreds of important and, often, business-critical decisions each day. We can't help but to react, then decide, and move on. While our gut and grit got us to this point of success, it's strategy that will take us from surviving to thriving.

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Jarred King is the founder and president of Swagger Agency, a full-service marketing firm as well as the current president of Entrepreneurs' Organization - Houston. King also serves on the board of InnovationMap.

Most venture capital rejection is because of one or more of these three reasons. Miguel Tovar/University of Houston

One of the most common questions that pops up in startup circles is, "Why did they turn me down?" There are myriad reasons why a venture capitalist might turn down pitches and decline funding. Here, I'll present the three most common.

They don't understand your business

Einstein once said, "If you cannot explain it to a six-year old, you don't understand it yourself."

If you spend an entire presentation showing well-researched facts and figures, talking about how groundbreaking your idea is, and presenting detailed charts and graphs, but your audience still has no idea what you do, you're in trouble.

Moreover, avoid overusing jargon and esoteric terms in your pitch. Speak simply.

If you cannot explain in simple terms what your startup does and why it's marketable, potential investors have no reason to believe you will know what you're doing with their money. To sum up, they'll think you don't understand your own business.

They don't think you've done the legwork

Some venture capitalists invest in early stage startups, so it's totally normal for them to sit through pitches where a product has not even been built yet. Consequently, the problem comes when it becomes evident the startup founder has failed to do any legwork. As a result, investors are likely to feel insecure about giving their money to someone who couldn't even do simple research.

Sure, the product hasn't been built, but that is not an excuse to sit back on cruise control. In other words, don't take your foot off the gas. Move forward constantly and don't stop learning more about your industry.

What have you done for customer development? Customer discovery? How many potential customers have you talked to? How much would they pay for your product or service? Have you studied the competitive dynamics of the market for which you will enter? Who is your competition and what are their strengths and weaknesses? You get the picture.

Certainly, one big misstep among startup founders is that they tend to believe work should not be done until they attain funding. Wrong. During your struggle to attain money, you should be busy learning everything about your industry, market, and customers. That way, once you finally get that meeting with an investor, they will feel much more confident that you will use their money intelligently.

They don't see that you have a strategy

It's an unfortunate commonality that a startup founder will put together a great pitch, get deep into it in front of a venture capitalist, and then unravel the entire presentation by exposing themselves as not having a plan of attack for the market. To clarify, it is a huge waste of your time to undo all your hard work by showing you don't have a strategy. Remember, investors are looking for reasons to pass on you.

When asked about their strategy for reaching the market, a common refrain is, "we will provide this awesome service (or make this awesome product) and the customers will roll right in." Or even "we will partner with this corporate giant who will sell our product because it's that amazing."

Above all, you must show your potential investor that you have the wherewithal to create, polish, and scale a reliable process that reaches your customer base.

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This article originally appeared on the University of Houston's The Big Idea.

Rene Cantu is the writer and editor at UH Division of Research.