You need an Ideal Customer Profile, Part 2

This week's main topic is part 2 on Ideal Customer Profiles.

This is part 2 of 2 in the series. Read part one, what Ideal Custoemr Profile is here.

What you'll read this week:

• How to Implement an Ideal Customer Profile
• Real-life examples of Ideal Customer Profiles
• Weekly Interweave Bootstrapping Update

Enjoy!

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How do you implement an ICP?

Last week, I shared the whys and whats of Ideal Customer Profiles. This week is all about the how and examples.

Hopefully, you're convinced you need an Ideal Customer Profile for your SaaS. And the process will look similar no matter where you're at, whether you're just starting or part of a thousand-person company.

Writing an ICP is easy.

You can and should literally just start.

You should do a couple things to make it usable and the experience worth it.

1. Take a first stab at your ICP based, but treat it like a draft.
   1. Think through each attribute of an Ideal Customer Profile, which ones apply, and how you would define what matters for each one and your specific situation.
2. Now, evaluate the market size for the ICP you've drafted. Be sure you still have a large enough total addressable market.
   1. Please don't get so specific that there are only 5 people left, but it's good to get very narrow. But targeting it so that all the people you know 5 come immediately to mind is a great spot.
3. Next, go interview people who meet this exact ICP.
   1. Validate that your refined scope meets their needs.
   2. Start learning their specific language. Use this language in your ICP.
   3. Refine your ICP even further if you discover it needs to be narrower.
4. Now, start using it! Make function-specific plans to use your ICP
   1. Sales - Build a scoring system that scores all prospects based on your criteria. Focus 90% of your sales effort on prospects that clear a score threshold.
   2. Marketing - Build ads based on your ICP. Ensure all your marketing copy matches it. Make everyone in marketing know it by heart.
   3. Product - Put your ICP front and center. Have every dev and PM know it by heart. Use it in feature and product feedback prioritization. Ask yourself, "Is this something for our ICP or someone else?:"

Building an ICP with a team

If you're building your ICP within an existing company, you cannot define your ICP by yourself. Here are some tips if you're a head of product, CEO, etc.

• Help everyone see the value of an ICP and why it's essential.
• Start with your company's strategy. Be sure everyone is on the same strategic page first. Otherwise, you'll likely get wide divergence on your ICP attribute definitions.
• Include many voices in these steps. Bring in sales, product, product marketing, and the heads of finance and engineering. This will help buy-in and cover knowledge gaps.
• Now, brainstorm on the attributes together. Use a virtual whiteboard tool like Mural. (there's a bunch like this; Mural is my favorite, and this isn't a sponsored link).
  • Put each attribute in a large box and have your team put sticky notes with what they think the attributes look like.
  • After a set time, coalesce similar attributes, discuss each, and vote.
• Pull it all together and have your team review it. Then, take your newly defined ICP and go back to evaluate the market size, do interviews, etc.

Ideal Customer Profile Examples

So, what does an Ideal Customer Profile look like? Here are three examples of real B2B ideal customer profiles. These are not 100% complete, but they're all for companies I started or worked at and will give you an idea of what you're looking at.

I've highlighted a few key considerations on why one value is selected over another.

Enterprise Cybersecurity Company

The last startup I worked on sold cyber risk quantification software. When we first started, we sold to anyone who was problem-aware. But as we learned, we soon realized that our ICP had more attributes:

• Company Size - Fortune 1000. They're the ones who are under the most scrutiny, have larger budgets, and are problem-aware. (over time, this grew)
• Industry - Certain industries had far more regulations that served our space. Finance and Health care were two big ones. There are others, but these two led the charge.
• Team Composition - We discovered that specific team compositions were less likely to be successful. Not having someone 100% dedicated to using our product was a sure sign of failure.
• Security Program Focus - Our software could be used for many functions, but more success would happen when the security program was focused on specific outcomes over others.
  • This is a big one; to know the focus, our Sales team would have to do a lot of active listening rather than pitching.

B2B Product Management Software

As I was validating Interweave, my own startup, I soon discovered that the pain I'm addressing often isn't experienced until the company has these attributes:

• Company Size - 100+ employees
• Company Size - They have dedicated customer success, sales, and marketing teams.
• Company Size - Has more than 100 customers.
• Company Revenue - Has more than $5M+ in revenue.

Does it work for smaller companies?

Yes.

But. During validation interviews, I quickly found that there is more problem awareness once you have the above attributes.

• Less and they will still have pain from customer feedback, but they won't have the pain of multiple stakeholders and sources (see below)
• Fewer customers and it can be done relatively quickly in a spreadsheet or by your gut.
• Higher revenue because we want to sell to companies at a specific price. We want to be something other than bottom-feeding.

B2C Gaming Community Software

Years ago, I was trying to make software for gamers. I made the target MVP far too big because I was trying to meet too many needs and compete against some larger established communities. I would have been better served by the following ICP:

• Community Size - Fewer than 50
• Game - Non-MMO's

The main reason is, in hindsight, there was a substantial unaddressed market at the time. A gap that Discord and similar apps address today. I wouldn't have needed to read complex game data to help raids and similar systems. Instead, I could have focused on a much smaller MVP on real-time community connection.

OR I could have gone with:

• Language: Spanish

At the time, there was a less complex game that had insane growth in Spanish-speaking countries. I knew enough Spanish and friends who could have helped me build a solution for this one game in Spanish and expanded from there.

But instead, I went with the worst ICP possible:

♾️

You can't be everything for everyone. You can only be some things for some.

Final Notes

ICPs can change

As your company grows, so will your ICP. It's common for companies to move up-market. Your ICP will need to reflect this as well.

Or you're expanding into new verticals. You may need a different ICP for this vertical. Your sales and marketing copy must reflect this, so your ICP should too.

What if a great prospect doesn't match our ICP?

Your ICP isn't saying no to everyone outside your narrowly defined ICP.

It's putting guard rails and focus on your company. It's not a hard and fast rule.

Experimenting with your ICP is recommended.

Leaving some room in your focus for non-ICP matching prospects and customers is a great way to see if there's an upmarket or new vertical move you can make.