As a founder of a hardware or software platform with potential applications across many markets, it’s natural to want to showcase your solution’s broad capabilities to investors, customers, partners, and distributors. The cumulative opportunity is indeed massive. However, to successfully raise money and execute effectively, you need to focus on a single use case.
To capture attention during your pitch, you must identify a clear target market and a compelling pain point that your solution addresses. This is most persuasive when built around one type of customer and related pain points, demonstrating your deep understanding of their specific needs. If you try to cover too many use cases, your pitch risks sounding overly broad and generic.
What is a Use Case?
A use case for a startup company is a specific example of how the company’s product or service will be used by a target customer to solve a particular problem. In essence, it’s a scenario that demonstrates the practical application of the product to fulfill a need, providing a clear picture of its value and relevance in a specific context. For a startup, defining a use case helps clarify the target market, refine the product’s features, and strengthen the pitch to investors and stakeholders. The main elements include:
Target Customer: The specific type of customer or user that the startup’s product is designed to serve. This includes demographic or business profile details such as industry, size, or role within a company.
Pain Point or Problem: A clear description of the challenge or problem the target customer faces, which the product or service addresses. This should be a real, pressing issue that the customer needs to solve.
Solution: A concise explanation of how the startup’s product or service directly addresses the pain point or problem, highlighting unique features or capabilities.
Value Proposition: The main benefit the customer will gain from using the product or service. This could be cost savings, time efficiency, quality improvement, or other specific advantages.
Customer Needs and Expectations: Any specific requirements the customer has for the solution to be successful, such as ease of use, compatibility, reliability, or particular features.
Competitive Advantage: How the startup’s solution is superior to alternatives on the market, outlining unique aspects that make it the best fit for this use case.
Metrics for Success: Quantifiable outcomes that indicate the success of the solution for this use case. Examples might include reduction in time, increase in productivity, customer satisfaction scores, or cost savings.
Example Scenario (Optional): A hypothetical narrative that walks through the steps a target customer would take to use the product in their day-to-day operations. This scenario brings the use case to life and helps investors or stakeholders visualize the solution in action.
Benefits of a Single Use Case
Focusing on a single use case allows you to tell a stronger story, and although it may be challenging to choose one path, doing so provides you and your team with clarity and impact. Here are the reasons why homing in on one use case is crucial:
Enhanced Pitch Clarity: When you target a single market with a single pain point, you can vividly bring that issue to life. Multiple pain points dilute the message and can confuse your audience. It can be too abstract rather than specific.
Focused Product Development. Startups often try to build too big of an initial product, which costs more money, uses more resources, takes more time, and introduces more complications. Focusing on a target use case can simplify and speed the process.
Technical Feasibility: Different use cases often demand unique adaptations, whether specialized libraries, data sets, interfaces, or compatibility requirements. Attempting a one-size-fits-all solution risks creating an unwieldy product that serves no market well.
Aligned Value Proposition: Each market may prioritize different aspects of your platform, ranging from cost to precision. Trying to convey multiple value propositions weakens your message and may lead to conflicting perceptions.
Focused Go-to-Market Strategy: Diverse markets often require different sales approaches—consumer direct, major accounts, or distributor-based strategies. Juggling these diverts energy and resources, reducing your effectiveness in any one channel.
Maximizing Impact: It’s better to execute one thing excellently than to struggle with many. Consider it like catching tennis balls: if someone throws you five in quick succession, you can catch each. But if they throw all five at once, you’ll likely end up with only one or even none.
Focusing on a single use case also lets you map specific pain points directly to your value propositions, customer needs, and competitive advantages. This alignment makes for a compelling story, as in this example:
Starting with one use case doesn’t mean ignoring your platform’s full potential. After establishing traction in your initial market, you can introduce your vision for future use cases to show the broader scope of your platform. The broader uses can be one of the last slides in your pitch deck, showing your startup has space to expand.
Criteria for Choosing Your Initial Use Case
Selecting your first use case is a strategic decision and shouldn’t be based solely on market size. Consider these additional factors:
Time to First Revenue: Early revenue can fuel growth and attract investment. The ideal market might be one where you have existing relationships, urgent demand, or rapid decision-making cycles.
Tolerance for an MVP: Some early users may be more forgiving of a minimum viable product and willing to work through issues, whether with feature gaps, a rougher interface, or stability concerns.
Availability of Partnerships: Strong partnerships can ease market entry. If you have industry partners eager to collaborate, this might be your most viable initial path.
Access to Grants or Non-Dilutive Funding: Certain use cases may align with funding opportunities, helping to subsidize development without giving up equity.
In the end, this focused approach is about telling a powerful story with a single use case. After gaining traction, you’ll be in a stronger position to expand and convey your broader vision. This is a challenging choice but an essential one for startup success.
