Why do you want to give shit about value proposition at an idea stage?

val prop

When a new wannabe founder is excitedly sharing his new business idea and how it is going to revolutionise the world, all goes well right through when he is talking about the problems his startup aims to solve.  Technology, product, target audience, and growth plans.

Then I hit the wall when he is asked a question: “What’s your value proposition for this target audience?”

And, he gives a blank look.

He either starts describing the pain point of the audience or starts listing out a few features of the product offering, as a response.

These things are not your value proposition.

Many founders don’t comprehend the exact meaning of value propositions, and their crucial importance to startups, particularly early stage ones.

What is a value proposition?

Essentially, the value proposition is the #1 thing that determines whether people will bother to invest more time and energy to know more about your product or hit the back button. In the early stage of a start-up when you are not yet known popularly, it becomes even more critical that you have a better value proposition.

“Unique Value Proposition: A single, clear compelling message that states why you are different and worth buying.”

– Steve Blank, The Four Steps to the Epiphany

Value proposition & lean canvas

If you are familiar with lean business model canvas by Ash Maurya, the value proposition is one of the 9 blocks of a business model that you sketch when you get started to put your idea onto a paper.  It is one of the most important elements of the business model and therefore critical for start-ups to get it right, or at least note what your hunch is about the value proposition is, right from the time you write your first canvas.


The good news is you don’t have to get this perfect right away. Like everything on the business model canvas, you start with the best guess and then iterate from there.  The point is, you cant ford to put it blank for a long time and you better know sooner what you want to fill it with.

Why does it matter to you?

There are several benefits of (or reasons as to why) as to why you should give a shit to the articulated value proposition, right when you are working on your first few lean canvases and here are some, not necessarily in the order of importance.

An idea in your head alone is not great!

As an entrepreneur, one of the most important tasks you are required to perform in the early days is getting your idea(s) out from your head into a tangible format so that you can communicate that with others.  What will your startup do? Who will it serve, and how will you be different or unique? You need to answer these are questions clearly, effectively and quickly. If not, target audiences (prospects, partners, investors, and media) move on because they’re time-strapped.

It is the core of your business model

Your value proposition is like the CORE of your business. It defines to the customer, exactly what solution you can provide for the problem they have, what makes your solution better than other available options and what value do they get out of this product from you.  At its core, it is the reason for your startup’s existence.  If this is so the core of what you intend to do, it is critical that you have as much clarity about is as possible, sooner than later.

Reason for charging what you get paid by customers

A more scientific description is that value proposition is ‘the promise of value that will be delivered to your customer’. A value proposition defines the benefits your company’s products and services offer to the customer. This short statement, based on your business concept statement, should express the essence of your business in a way that compels the customer to buy.

Clarity to yourself

It helps you because it keeps you, the entrepreneur, in check, so that you always keep in mind exactly what goals you hope to achieve while making your product offering. And hence you don’t veer off your course and you easily your targets.  Value propositions can also serve as the basis for your product development strategy.

Direct connect with customers

Value proposition enables prospects to see what you are up to and if it resonates well with their life situation and pains or aspirations, they connect with you. They get that you empathise with them and care about them. They are willing to think that you can possibly build something that will solve their problem if you understand their pain so well.

Allows customers to choose you against other alternatives

It gives a reason to be chosen over your competitors. It creates a strong differentiation between you and your competitors.  Your value proposition delivers a synopsis of what you are offering to customers and why they should choose it.

You are able to attract right customers

It increases not only the probability of quantity and also the quality of prospective leads. If your value proposition is clear and strong it would attract the right profile of customers so you are able to derive relevant learning from your experiments when you test the value proposition.

More conviction

The biggest benefit you get from understanding your value proposition is a strengthened belief in your own offering.  If you truly understand the value you bring to customers from a business perspective, you’ll work harder.

Presentations to investors

Whenever you have an opportunity to tell your potential investors about your start-up, your value proposition is an essential part of the package that you will have to explain the whole game plan quickly and clearly.

Attract partners

This will come into play when you want to get partners and attract key employees.  The sooner you have clarity on your value proposition (or a hunch about it), the easier it would be for you to visualise what kind of partnerships you want to target.

Summing up

Value propositions play an integral role in defining your startup’s purpose and validating ideas among your target audience. Directly correlating with the business plan, they quantify the intended market position of your startup and demonstrate the fundamental value of your product offerings in the mind of your target audience.

The inability to communicate your purpose and value to your target audience, in a clear and concise manner, is a death sentence for even the best ideas. Often times, it is one of the root causes in the failure startups.

Ensure you are not one of them and give a shit to value proposition from today!


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