Despite what most entrepreneurs think, it’s not all about having the best product.
I recently had lunch with an entrepreneur friend who wanted my thoughts on his business strategy. However, it quickly became clear that he was more interested in showcasing his app’s newest features. After 15 minutes of listening to him discuss the latest functionalities, I had to ask, “Why does any of this stuff matter?”
He looked at me, puzzled, and said, “This is what people are buying. To win the market, we need to have the best product.”
“Tell that to the company that invented yellow pencils,” I replied.
The History of Yellow Pencils
I had just read an interesting story about why pencils are yellow, and it seemed like a relevant lesson.
In the late 1800s, an Austro-Hungarian company named Hardtmuth wanted to create the most amazing pencil the world had ever seen. They named it the Koh-I-Noor, after a famous diamond, and painted it yellow to symbolize luxury. The yellow color was associated with royalty and prosperity in China, and the best graphite for pencils came from the Orient. This connection made the yellow pencil a symbol of exotic luxury.
However, once the Koh-I-Noor became popular, other manufacturers copied the design, and yellow pencils became the standard. What was once a unique feature turned into a commodity.
Turning Luxuries into Commodities
After sharing this story, I asked my friend, “If the yellow color of pencils today is simply the result of one company’s attempt to distinguish its product, what does this tell you about the usefulness of creating impressive features?”
He thought for a moment and said, “I guess it tells me that if your features are good, other companies will just copy them.”
“Exactly,” I replied. “Features are easy to copy. Once the Koh-I-Noor became popular, other pencil manufacturers copied it, and the market quickly became commodified. Keep that in mind as you obsess over your product’s features. You need a better way to protect your business.”
“So what’s the better way?” he asked. “If features aren’t the thing that wins markets, how do companies innovate to become successful?”
“You still need to innovate,” I reminded him. “But focus on something that matters more than features. For example, can you innovate around customer acquisition?”
The Real Secret to Startup Success
The real secret to entrepreneurial success isn’t having the best features; it’s having the best customer acquisition process. The company that ultimately dominates its market isn’t the one with the best product; it’s the one with the most effective customer acquisition strategy.
At North Road AI, we understand this principle deeply. That’s why we’ve developed PIRAI, our AI-driven mentorship platform, to help early-stage founders not just build great products but also master the art of customer acquisition. PIRAI provides instant, personalized advice 24/7, combining AI insights with human expertise to guide founders through their unique challenges. This approach ensures that our users can quickly and effectively reach their target customers, setting them up for long-term success.
By focusing on customer acquisition and leveraging the power of AI, North Road AI is helping founders dominate their markets in ways that go beyond just having the best features. We’re creating a new standard for startup mentorship, one that prioritizes strategic growth and sustainable success.
