Signing the First Customer

Yesterday I had the opportunity to interview Craig Hyde of Rigor at our Simply SaaS Forum. Of course, I asked one of my favorite questions: how did you sign your first customer? Craig recalled spending eight months full-time building their product before signing KontrolFreek as their first customer for $50/month. Now, it wasn’t much money, and frankly, KontrolFreek wasn’t sure it was even worth purchasing. Then, as timing would have it, the KontrolFreek site went down and Rigor promptly notified them using their digital experience monitoring platform. Rigor showed when the site started to degrade as well as when it came back online — all data delivered to their ecommerce vendor to enforce the SLA and work to ensure it doesn’t happen again. After that, KontrolFreek was a customer for life and Rigor was off the races telling that story and signing up customers.

For Pardot, our experience signing the first customer was different in that the product was built around our sister company, Hannon Hill, from the beginning. By being in the same office, we could ask questions face-to-face and move fast listening to the feedback and desires of the marketing and sales teams. While things started slow, as they almost always do, once it got moving and we figured out that the product created 10x the value of the alternative (status quo), high growth followed.

Signing the first customer is critically important for a number of reasons:

  • First, by exchanging money — even a modest amount — the relationship becomes real and the feedback becomes serious. Make sure and charge something so that it’s a bonafide customer/vendor relationship.
  • Second, too often entrepreneurs build their product in vacuum without feedback and input from the customer. By following the customer discovery process and signing a customer quickly, the product is going to achieve product/market fit much faster.
  • Third, while entrepreneurs believe in their vision, it can be lonely as that vision is untested and unconfirmed. The sooner that first customer buys into the product, and shares great feedback, the more confident the entrepreneur is that he or she is on the right path.

Signing the first customer is one of the first micro-milestones in a startup, and often one of the most important. Entrepreneurs should start talking to potential customers even before starting their startup, and work to close a paying customer as quickly as possible. Remember: nothing happens until something is sold.

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