Customer Validation
Prove you have a repeatable and scalable sales process by getting customers to actually buy
Customer Validation is the second step in the Customer Development model, and it is where the rubber meets the road. The goal is to build a repeatable sales roadmap for the sales and marketing teams that will follow later. This roadmap is the playbook of a proven and repeatable sales process that has been field-tested by successfully selling the product to early customers.
The step has four phases. Phase 1 is getting ready to sell by articulating a value proposition, preparing sales materials, developing a distribution channel plan and preliminary sales roadmap, and hiring a sales closer. Phase 2 involves leaving the building to sell the product to earlyvangelists, those visionary customers who will buy an unfinished product. Phase 3 develops product and company positioning. Phase 4 is the critical assessment of whether to iterate, return to Customer Discovery, or exit.
A key insight is that you are not building a sales organization during this step. You are building a roadmap to sales success. The sales roadmap answers fundamental questions: Who influences a sale? Who recommends it? Who is the decision-maker and economic buyer? Who is the saboteur? Where is the budget? How many calls per sale? How long is the sales cycle? What is the selling strategy?
Customer Validation proves product-market fit through actual purchases, not polite interest. If the sales process is not repeatable, you must iterate or pivot back to Customer Discovery rather than pressing forward and scaling a broken process.
- Building a roadmap to sales success, rather than building a sales organization, is the heart of Customer Validation
- You care less about revenue than about finding a scalable and repeatable sales process and business model
- A customer purchase validates what polite words from potential customers cannot
- Do not staff a sales team, execute a sales plan, or implement a sales strategy until hypotheses are validated
- It is impossible to build a sales pipeline without first having a sales roadmap
- The sales roadmap must be tested by the founders, not delegated to hired salespeople
- Adding more salespeople does not speed up the learning process, it slows it down
- If you cannot find enough paying customers, return to Customer Discovery
- Phase 1: Get Ready to SellPrepare all materials and strategies needed for selling. Articulate a clear value proposition. Prepare sales materials including a preliminary collateral plan. Develop a distribution channel plan and a preliminary sales roadmap covering the four elements: organization and influence maps, customer access strategy, selling strategy, and implementation plan. Hire a sales closer. Formalize the advisory board. Ensure Product and Customer Development teams agree on features and delivery dates.Pro tipThe sales roadmap comprises four elements that you will initially fill with conjecture from Customer Discovery. As you actually sell, you refine initial theories with facts from the field.WarningDo not confuse a sales pipeline with a sales roadmap. It is impossible to build a pipeline without first having a roadmap. Most experienced Sales VPs try to build a pipeline immediately, which fails because the underlying roadmap does not yet exist.
- Phase 2: Sell to EarlyvangelistsLeave the building and attempt to sell the product to earlyvangelists, visionary customers who will purchase an unfinished product because it solves a critical problem for them. The goal is to answer all the sales roadmap questions through actual selling experience. Failures are as important as successes because they teach you what does not work. Refine and validate the sales roadmap by persuading three to five customers to purchase.Pro tipDistinguish earlyvangelists from early evaluators, scalable customers, and mainstream customers. Earlyvangelists have a problem, know they have it, have been actively looking for a solution, have cobbled together an interim solution, and have budget or can acquire it.WarningDo not confuse early evaluators with earlyvangelists. Early evaluators are happy to try your product but have no urgency to buy. They will consume your time without generating revenue.
- Phase 3: Develop PositioningBased on what you have learned from actual selling, develop product and company positioning. Test this positioning with customers and refine it. The positioning must be appropriate for your Market Type. In an existing market, position against competitors on specific features. In a new market, position the company and product as creating entirely new value. In a resegmented market, position based on what makes your niche or low-cost approach uniquely valuable.Pro tipTest your positioning with actual customers rather than developing it in a conference room. What sounds compelling internally may not resonate with buyers in the field.WarningDo not finalize positioning before you have actual sales experience. Positioning that changes weekly, as happened at InLook, signals that the team has not yet validated its understanding of customers.
- Phase 4: Iterate, Return, or ExitHonestly assess whether you have met Customer Validation objectives or are just moving the goal posts. Verify the sales process is repeatable with full-price orders in sufficient quantity. Check that your product delivery timeline still holds. If selling failed, modify the sales roadmap and return to Phase 1. If the problem is in the product itself, loop all the way back to Customer Discovery. If everything checks out, you have proven product-market fit and a repeatable sales process.Pro tipBefore moving forward, verify: have you really met the objectives or are you just moving the goal posts? When you move to the next step you are about to seriously crank up the burn rate.WarningIf you sold vaporware because product schedules slipped, shut down additional selling, admit the mistake, and turn pilot projects into something useful before continuing. Continuing to sell as if nothing has changed will destroy your earlyvangelist references.
InLook had a VP of Sales who built an impressive-sounding pipeline and kept the CEO away from customers. When the CEO finally called accounts directly and asked whether they would deploy the product for free, every single one said no. Five salespeople were using different approaches, marketing changed the message weekly, and the company had no standardized sales process. Eleven people were burning cash with no understanding of how to actually sell.
Design Within Reach treated its hypothesis about design professionals as an educated guess and tested it by analyzing sales results from each catalog. The company kept refining its assumptions until it found a repeatable and scalable sales and customer model. The burn rate was kept low by plan while the team found a sales roadmap that could scale.
The concept of Customer Validation crystallized through Steve Blank's work with startups like InLook, where an eleven-person sales and marketing team generated zero revenue because no one had validated whether the sales process actually worked. The VP of Sales had five salespeople using different approaches, marketing changed the message weekly, and the entire forecast was based on polite customer interest rather than genuine buying intent. Blank realized startups needed a step specifically focused on proving the sales process was repeatable before investing in scaling it.