StartUp Founders: Don’t Build Until You Know Your Distribution Strategy?

Product development is undoubtedly a key focus for startups. However, for an effective market entry and sustainable growth, a well-thought-out distribution strategy is indispensable.

I frequently encounter a particular tendency among startup founders: the inclination to dive deep into building their product without first considering their distribution strategy. This focus, while seemingly logical, is not necessarily the most advantageous path for a burgeoning business. In fact, it might just be the opposite.

Let’s consider a scenario. You’re a startup founder, you’ve got your Product-Market Fit (PMF), a Minimum Viable Product (MVP), perhaps even some seed financing. You’re on the cusp of delving into serious engineering, fervently dedicated to bringing your product to life. This is where I would implore you to pause and reassess. One crucial aspect must precede this step: distribution.

How are you planning to sell your product? How will you position your offering in front of potential customers and persuade them to buy it? What’s your Go-To-Market (GTM) strategy? These questions define your distribution strategy, which is, at this juncture, even more important than your product.

Why is it so critical, you may wonder? Well, consider this: you could expend tremendous energy and resources building the most exquisite product the world has ever seen. However, if you don’t have customers lined up, your venture is inevitably doomed. Your business is nothing without its customers. And first-time entrepreneurs often stumble into two critical misconceptions.

The first is the fallacy that a valuable, beneficial, and well-priced product will naturally scale. This notion that ‘if you build it, they will come’ is, sadly, a rarity. A good product is by no means a guarantee of inevitable scaling. The harsh reality is that it’s not always the best product that wins, but the best known. As Bill Gates, co-founder of Microsoft, once said, “If I was down to the last dollar of my marketing budget, I’d spend it on PR.”

The second error is the idea of outsourcing sales too early. The first sales, whether they number one or ten, will almost invariably come from you or your founding team. This is because you understand the product, the market, the vision, and, most importantly, you harbor the passion for your venture. It’s a Herculean task to hire someone, transfer all the knowledge residing in your head, instill them with the same fervor you possess, and expect them to effectively field all possible inquiries. It’s an improbable scenario.

So, with this in mind, what is your distribution plan? What happens once you’ve completed your engineering cycles and you have a market-ready product? The absence of a GTM plan renders your product practically irrelevant. I urge you, consider your distribution strategy from the get-go, and allow your product development to be informed by this strategy. Good luck on your journey.

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