a16z: How to "recommend" crypto startups?

Author: Pyrs Carvolth, Maggie Hsu, both of whom are partners of a16z crypto

Compiled by: Luffy, Foresight News

For founders, it is crucial to be able to clearly communicate the company’s vision, which includes telling the company’s position, prospects and differences from its competitors. In the early stages, especially those that have not yet launched available products, it may feel that it is too early to articulate the company's mission. But well-thought-out core information can bring together the team, help founders establish credibility and clear goals, and bring products to market more effectively.

There are already many reference resources for building a brand and carefully writing mission statements that reflect the values ​​of the team. But integrating these elements can be challenging. Therefore, in this article, we will focus on how to adjust and distinguish mission statements from statements of interests, and how to improve elevator lobby (Translator's note: elevator lobby is a brief and refined explanation method used for Introduce your company, product or creativity to others within a limited time) for partnerships, sales empowerment, financing and other aspects. We will also share the basic information founders need before bringing their products to market.

A brief description of ideal customer portraits and how to use them in the crypto space

In this article, we will use the concept of ICP (ideal customer profiles). This is a well-known commercial development tool for defining potential customers most likely to buy the product you sell from dimensions such as behavior, environment, and demographics.

Why is this important? Ideal customer portraits can help you understand the target audience, that is, the person you "sell" and adjust the information delivery method accordingly when you receive feedback. For example, technical audiences need more technical details; while people in the business field need less details, but pay more attention to the benefits and results brought by the product.

Sounds pretty good, but in the crypto space, especially for companies in front of the seed round, defining an ideal customer profile can be tricky because it means that business results should be considered immediately while the product is still evolving and Target. It is difficult to define an ideal customer portrait when the product is not yet perfected. So, we encourage companies to think about their desired end users, partners, and customers and then develop information for product launch materials that allow them to easily adapt to different customers, conversations and situations.

In short, it's all about explaining to anyone in a clear and concise way why you are developing your product.

At the same time, it should be noted that no matter what audience you face, there is one message that should be consistent, that is, the mission statement.

It all starts with a mission statement

There have been many related discussions on how to write a good mission statement. But the core of the mission statement is “why”, which concisely describes the reasons, goals and values ​​of the company, and what makes it unique. This is crucial for positioning in many aspects such as recommendation slideshows, website copywriting, follow-up emails, sales conversations, etc.

Importantly, the mission statement related to the listing promotion strategy is not about "how to do it" or even "what to do". They do not need to elaborate on the specific business of the company or detailed plans to achieve their goals. Instead, the mission statement outlines the company’s goals and helps define the company’s position in the industry. The mission statement also has the following functions:

1. Set a core goal for the company and gather team strength

An effective mission statement provides much-needed directional guidance in situations where innovation and rapid growth can derail important goals, helping founders focus on those idealistic long-term goals initially set when the company was founded.

This core goal is especially important when the market is hot and the team needs to expand. They can incorporate mission statements into interviews, onboarding and performance evaluation processes, as well as strategic planning, product roadmap feature prioritization and marketing activities.

For example, Coinbase’s mission has long been to “promote economic freedom.”

Over the years, Coinbase has gradually launched centralized exchanges, wallets, NFT markets, layer two networks, etc. If focus on any single project, the overall principle of this mission statement may be ignored in the communication process. However, it is macro enough to allow the team to focus on this principle and then incorporate it into decisions about cultural values ​​and product investment, although the Base project appears to be beyond the scope of its core centralized exchange.

On the other hand, many startups want to focus on improving specific products or continue to focus on specific technologies or ecosystems. Blackbird's mission, for example, is to be a loyalty company that rewards people who love restaurants.

With this mission statement, both partners, customers and investors, target audiences can be believed that as the product grows, Blackbird will prioritize and meet the experience needs of diners and restaurant operators in a specific customer base Build loyalty and trust in.

2. Make the company different from its competitors

The crypto industry is still in its early stages, but it is developing rapidly in areas such as expansion solutions (such as expansion solutions and equity pledges). Coupled with the open source nature of the crypto industry, many different suppliers offer products that look very similar on the surface.

Companies in these popular tracks need to explore their own differentiated advantages in terms of products and narratives. First, make sure these differentiated advantages are integrated into the mission statement. Even if startups are still exploring their own differentiated advantages, identifying the impact of these advantages as early as possible may be as important as providing a chart of features that compare to competitor products.

Think of these as early branding opportunities. Focus on what you are unique as a founder, what is unique about the team you are forming, what is unique about the company you are creating, and what is unique about your product vision. Even companies that offer very similar products may have very different styles, and partners and customers ultimately consider these factors when comparing their competitors. Why not help them to draw these conclusions and allow them to share them internally in your words and speak out for your product?

For example, Towns, a way to build a hometown community on the internet, quickly established a different social networking mindset that no longer emphasizes a large global community, but tends to create intimate, well-planned and more local a gathering space.

3. Refocus on the market structure when changes

The mission statement is not static. Consumer attitudes will change, products will adjust their direction, and companies will carry out new plans. Founders inevitably encounter situations where the company develops beyond the scope of the mission statement.

While it is important for the team to adapt to changes and let the market understand the direction of the company’s work, the mission statement should be flexible enough to adapt to the necessary strategic shifts while still reflecting a unique vision.

Only those mission statements that embody the things that keep the founders sleepless at night and the problems they are solving for their users can stand out in the noisy market and stand the test of time. This is better than overlying the declaration of market preferences, which will eventually confuse internal teams.

Let's summarize

When planning an information delivery roadmap, write a mission statement first and then build a more specific statement of interest based on this (we will discuss it below). Each company is different, but here are some common guidelines:

What should be done:

• Focus on long-term vision
• Distinguish from competitors
• From a macro perspective, focus on basic principles and benefits, not products or functions
• Listen to the opinions of co-founders or employees of different functional departments
• By thinking about the following questions, use information transfer as an early branding practice: What changes will my company bring? As a company, what do we value and why?

Avoid doing:

• Get stuck in the details of product and functional specifications
• Communicate different mission statements to different audiences
• Write a "universal" declaration for any company in your industry

Similarly, each company has different needs and needs to evaluate its own approach. But once the mission statement is confirmed, you can start to develop a statement of interests.

Best practices for statements of interests

At some point, startups need to shift their focus from describing their core mission to giving customers an idea of ​​why they should focus on the company’s products. If the mission statement states "why", then the interest statement states "what" and "how to do it". They are based on the mission and outline the main advantages of a product or service in a concise, customer-centric language.

Statements of interest are very important when you sell products and will appear in your marketing and sales materials, and they have the following functions:

1. Provide background information using meaningful, tailored language

Crypto products often need to define new terms during promotion; it is crucial to elaborate on new terms in language and concepts that customers are already familiar with.

Using common industry terms is necessary, and the goal is always to avoid alienating the target audience. For example, audiences familiar with the crypto field will become familiar with abbreviations like DAO (Decentralized Autonomous Organization). They may get bored if the statement of interest spells it in full or explains its meaning in detail. Conversely, if the statement of interest does not explain the overarching concept, this may lose interest to a wider audience who still need to be guided by the introductory.

It is actually difficult to determine which terms are suitable and which are not. Many founders think “my audience is smart and they will understand.” But the reality is that people use and understand jargon in different ways. If you are not sure which terms work, don't make subjective assumptions. You can survey the audience at any time, or simply take some time to explain and let everyone reach a consensus.

For example, Alchemy wrote that their Node Application Programming Interface (Node API) allows customers to “connect to top-level L1 or L2, whose RPC infrastructure processes more than 30 billion requests per week and uptime of 99.9%. Here, there is no need to explain what L1 or L2 is, and even the full spelling of RPC is required. Their customers, presumably developers and engineers in the field of crypto, are likely to use these terms frequently and need no further explanation. And, despite some details involved in these claims of interest, they still fit into the company’s mission statement (the complete Web3 developer platform).

2. Go straight to the key points and pay attention to how products make

customers' lives easier

When writing a statement of interest for prospects and partners, be sure to describe the actual effects of cooperation, not just technical specifications. For example……

• Alchemy: Launches a reliable enterprise-level expansion solution that immediately reaches millions of developers
• Base: A secure, low-cost, developer-friendly Ethereum Layer 2 network
• Solana: leverages Solana's high throughput, low fees and minimal environmental impact to meet your business's specific needs

All of these claims of interest target products from the perspective of increasing efficiency for users, i.e. how they help customers achieve their goals faster or better than before.

For products seeking a completely new audience, describing how to do better is more challenging when something has never been done before. In this case, the founder may want to compare the benefits of the product with adjacent existing fields, or even abstract some technologies to make it easier for the audience to understand.

For consumers, Blackbird has removed specific crypto terms and positioned it firmly in the realm of restaurant loyalty. For example, they also describe their points as "universal reward currency" that people can spend in restaurants participating in the event. For diners who have not been exposed to the cryptocurrency field, this is much clearer than the term "tokens with limited transfers". Importantly, it captures the needs of food lovers who love to dine in restaurants, leverages their existing behavioral habits rather than asking them to adopt new ways of behavior.

3. Help founders improve efficiency

Especially in the early stages of the product life cycle, having a clear list of value propositions can help founders quickly understand conversations with customers, investors, suppliers, potential talents and other stakeholders. In addition, the team can adjust this list to use it in sales empowerment and marketing, including company websites, social media, GitHub code bases, sales presentations, and more.

A good statement of interest will follow the above core principles. They can make products and services clearer, enhance customers’ understanding of the company and the products they develop, and make early conversations more efficient.

Here are some suggestions for writing a statement of interest:

What should be done:

• Choose the language used by customers to resonate with them
• Get feedback on interest statements from customers, employees and other stakeholders, but make sure the information is relevant to your product
• Reuse of benefits statements in sales empowerment and marketing materials
• Linking benefits to mission statements, which also helps internal product teams, designers, sales teams, etc.

Avoid doing:

• Writing an overly broad or lengthy statement of interest
• Overuse of jargon, especially for audiences who do not understand jargon
• Try to reach multiple different audiences with a statement of interest

Once the statement of interest is determined, you can consider combining them with the mission statement to form an elevator lobbyist.

Improve elevator lobbying words

You may have heard of "elevator lobbying", which is the kind of speech you can use to promote your product or company during a short elevator trip. The elevator lobbying statement explains the company's "what", "why" and "how to do it" in the simplest form. Most founders have already practiced a lot when pitching to investors and could even blurt out, but it is still necessary to dig deeper here because this kind of rhetoric is very important. It will also be found everywhere in your listing materials.

First of all, the earlier you start thinking about elevator lobbying, the better. Founders must constantly evaluate their ability to bring their products to market and articulate the core points of the company. Their lobbying word is to build not only for the company, but also for the founders, showing who they are, what they are developing, and why they are the right person to develop the product.

Elevator lobbying can also save time. Founders can complete lobbying in less than a minute, and if said well, they can also tell whether they are talking to the right person. This is helpful for partnerships, sales and financing, and it also helps to get useful feedback immediately. For example, founders can immediately evaluate whether their lobbying is effective and then decide whether they need to adjust how their information is delivered.

Like mission statements and statements of interest, elevator lobbying is also an embodiment of company values ​​and culture and will evolve over time. So, it is a good habit to review and update it regularly to ensure co-founders, employees, and external company supporters are consistent.

Finally, here are some suggestions for perfecting elevator lobbying:

What should be done:

• Practice your lobbying words at events and conferences inside and outside the crypto field
• Get feedback from advocates and critics in the crypto space, which is harder to convince.
• Perform A/B tests to improve your expression according to different goals

Avoid doing:

• Destroy your lobbying effect at the last minute due to insufficient preparation
• Use the exact same lobby for different audiences: lobby should be adjusted according to the person you are talking to, such as a technical decision-maker or a business decision-maker

Integrate the above content: Four essential elements of information

transmission

All this information should be integrated into several different documents. Here are some basic things that each team should have before launching a launch promotion:

• Standard Introduction Paragraph: This introductory paragraph can draw a lot from the content of elevator lobbying. The founder should be prepared to present it in verbal and written form to include it in the website's "About Us" page and introduction email.
• Single page introduction: Single page content about the company, including some potential use cases. Include information from elevator lobbying words, mission statements and statements of interest, as well as any relevant data or points of attestation, such as customer growth, uptime, or key partnerships. The team can send this single page introduction as a read-out material before the meeting, and can also be sent in a follow-up email if stakeholders request more information.
• Business presentation: This is slightly different from an investment or a recommendation presentation, and it can actually be two to three presentations customized for different ideal customer portraits. Each version of the presentation should be properly adjusted to the information according to the situation and all contain a slide that discusses the next action. Note: We usually recommend that the founder explain this presentation with stakeholders instead of sending it ahead of time, as the conversation will guide the best order of presentation of the slides and the key points of each slide.
• Company website: Early stage companies sometimes use the GitHub code base instead of the website for marketing. A website should combine the company's information with key assets such as developer documentation and case studies, which can be very helpful in various conversations. While these information points and case studies can be shared temporarily, putting everything together helps to promote better partnerships and customer conversations.

When ideas arise and founders are still focusing on the iteration of products, it can be difficult to determine the direction of information delivery. Nevertheless, it is still important to start thinking about information delivery as soon as possible. Founders who do so will have more valuable information that can be used to talk to investors, clients and potential partners. Companies with effective information transmission will also have a key advantage in this hustle and bustle industry: from product roadmap to recruitment, there is a practical expression of work culture and values. Don't skip this step.