Do you ever worry that you aren’t landing your vision for your company effectively? A compelling vision statement can make the difference between success and failure for your startup.
Many startups focus their vision on their aspirations for the company itself – they want to be a global leader in their industry. Few focus their vision on the impact they plan to make for their customers, the community, or the world. In this article, we will explain what makes a compelling vision; and why it is so important to help you attract the highest quality team members, customers, investors and partners.
Why your vision is so important
A compelling vision for an early-stage startup is essential, both to attract followers, and to help you prioritise what you work on.
Attracting a high quality team
A compelling vision allows you to build a reputation as an employer of choice and attract the best talent. Increasingly in the US – though not yet globally – the best and brightest graduates are starting to see startups as a meaningful career choice. The graduates of today are driven by a desire to make an impact – rather than by financial drivers or the need to join a large corporate.
Early-stage startups sell to “early adopters”. Early adopters are companies (or individuals) who have the problem that the startup thinks they can solve; they know they have the problem; and they are either already paying to try to solve it, or they are willing to pay to solve it. Startups sell to these early adopter customers on the premise that:
- they are solving a painful problem for the customer;
- they have a compelling future vision;
- what the startup offers their customers actually gets better over time.
- customers have the ability to contribute and co-design to make that offering even better.
Crucial to finding these early adopter customers is having a compelling vision that these customers have bought into. If you achieve that “buy-in” from them, they then tell others about you, contributing to that viral word of mouth that is so important in helping you grow organically.
Attracting high quality investors
A compelling vision is crucial to adequately establish your potential to investors.
Uber’s vision statement is “transportation as reliable as running water, everywhere for everyone.”1 In 2014 Uber was valued by Aswath Damodaran at just under $6 billion, based on its potential as a transportation company. However, when an early investor pointed out their potential as a logistics company, Aswath revalued the company at $54 billion.2 The limitations of Uber’s vision statement – based on transportation (for individuals) alone – made the difference of $48 billion in their valuation.
Driving your success
Your vision isn’t just important to attract followers. It becomes the guiding principle for all decisions you make along the way. Your vision statement sets the context for you to prioritise your company goals, and the metrics you will measure against them. Your vision statement helps you define what goes in your company roadmap – your plan for the investments you will make in your business.
Equally important – your vision can help you to make decisions about what you shouldn’t focus on. Every early-stage company we’ve worked with has aspirations to complete more work than they have had the capacity for. Use your vision statement as a checklist – will working on this help you take a step towards achieving your vision? If not, stop working on it.
So far, we’ve focused on why a compelling vision is so crucial. Next, we will explain what makes a compelling vision.
What makes a compelling vision
Imagine if AirBnBs vision was to be “the worlds’ largest hotel company.” Not quite as compelling as their actual vision statement: “Airbnb exists to create a world where anyone can belong anywhere, providing healthy travel that is local, authentic, diverse, inclusive and sustainable.”3
Amazon’s vision statement is “to be Earth’s most customer-centric company, where customers can find and discover anything they might want to buy online.” 4 Amazon’s vision statement is both customer and company centric.
A compelling vision meets the following criteria:
Customer and Employee Centric
The most compelling vision statements are customer centric, in that they focus on the impact you want to have 10 – 20 years from now. That vision is also likely to motivate your employees with a driving force and is therefore employee centric too.
Capable of a high Return on Investment
Whilst this criteria is “finger in the air”, you want your vision to make investors excited at both your potential, as well as the potential return that could materialise for them: at least 40 x the return on the capital they invested.
A compelling vision is crucial to help you define the impact you want to have and give you the highest chance of succeeding in making that impact.
If you’d like to find out more about how LeapSheep can help you to craft an impactful, compelling vision statement for your startup – click here.