Ideal Customer Profile (3 Things You Need to Know About Creating a GREAT ICP)
Video Transcript
(00:00) you see that giant black circle with the purple that’s everyone in the world you see that tiny tiny speck in the middle all to the side that is your ideal customer profile oh as known as your ICP on this episode I’m gonna walk you through why an ICP and I do a customer profile when done right is the most important growth tool for your business so that you can accelerate your path to traction to park market fit and the next stage of growth intro what’s everybody welcome to unstoppable I’m TK author of the book how to punch the Sun day
(00:44) jitters in the face entrepreneur and angel investor on this channel I help star founders like you become unstoppable in your personal life and your business through belief and discipline I drop a video like this every single Sunday so be sure to hit the subscribe button and the bell icon so that you get notified being a start-up founder is one of the toughest jobs in the world the reason there’s a lot of reasons for it but the one of the most important reasons is that you have to deal with opposing ideas one example of an
(01:15) opposing idea is on one hand you have to build a very very scalable business but at the same time you have to know how to do unscalable things in the beginning to get it going so that you earn the right to go after a more scalable business so you get the funding the resources the growth the traction to go and build that scalable machine similarly on one hand you have to go after a really large total addressable market really large time but at the same time you have to master the art of really niching down getting very specific and so I’m a very
(01:48) small problem so that you earn the right and get noticed and get that traction to go after something bigger dealing with these opposing ideas all at once is what makes star founders really special it’s only us that really knows how to manage that duality manage those opposing ideas all at once now on this channel I always bring you growth tools and strategy tools that you can use to make that lift a little bit easier and one of my most favorite tools is the ideal customer profile ICP and when used right it can actually
(02:23) accelerate your path to traction to park market fit and that next stage of growth I’ve used in ICP multiple times whether it was a tout app where I took it from zero to seven millionaire are we sold town app to Marketo right when it went private owned by vista and we used the ICP exercise to really hone in on how we were gonna drive growth it was so successful that Marketo was eventually sold to Adobe within two years after the transformation for four point seven five billion dollars billion ICP is one of the most important things that you can
(02:53) do and so I’m dedicating three episodes to it on this episode I’m gonna walk you through the three things you didn’t know about building an ICP on the next episode I’m gonna walk you through step by step on how to actually build an ICP and the episode after that I’m gonna walk you through on how to implement it so be sure to hit the subscribe button and the bell icon so you’re notified when these new episodes drop hit the like button and let’s get started with point number one the thing that you didn’t know about building an ICP so
(03:23) every star founder knows that you got to build an ICP right a lot of star founders I talked to they have a one more definition of what their ICP is they may have an idea in their mind that they’re iterating on but they very rarely write it down and so what I always say the thing that you aren’t doing is actually writing down your ICP and there’s a very very specific way to write it down I equated to going on amazon.
(03:47) com and typing in a search for something you want to buy let’s just say you want to buy pants you type in pants and Amazon returns all the pans that they sell in their giant marketplace and then you use a little thing on the side the little toolbar the little panel to filter down those results so you may have a million pass that they sell and then you say I want blue pants I want gene plants and I want pants made by a certain brand I want pants at a certain color and as you click on each of those things it goes from a million pants to maybe a hundred pence and
(04:16) that’s kind of what an ICP is really about a great ICP when done right is actually very specific and tries to go for a small a market as possible so that you can get to attacking that market and get that initial traction so often I see star founders trying to please investors by signing a really large Tam and a really large ICP but in reality that doesn’t actually help you build the business so the first thing you thinking about is actually writing down your ICP and making it as small as possible point number two is once you
(04:49) have your ICP you need niche down even more one of my most favorite sayings in the world is the riches are in the niches see that ICP there’s gonna be a tiny speck even within that ICP that actually is where you’re gonna get your initial traction that’s where you’re gonna get your initial growth that’s we’re gonna get your initial product market fit and once you conquer that niche you will get your riches and you’ll get the resources to actually broaden to take over your entire ICP I’ll give you a perfect example of this
(05:22) when town up started I start with a really giant circle I said every single business email user in the world would want to use Tower app we want to fix business email turns out that was too large of an ICP our messaging was all over the place we didn’t really know how to get attention and it wasn’t urgent enough of a need even though email was a massive pain point so we niche down we noticed that sales people loved using our product so we just find our ICP at that point as sales people and even within that we decided to really really
(05:53) hone in on that tiny spec we started to focus on STRs and sales reps that had to generate pipeline and because of that they were sending a lot of outbound emails to generate that pipeline the moment we started to niche down we start to see the riches the moment we started to really focus in on that tiny group of people in the grand scheme of things we were able to get momentum we were able to get notice we were able to raise funding we were able to get growth and over time we earned the right to go after AES to go after CSM’s
(06:23) and so on and so forth and even today while tower top hat was sold to Marketo right now there are companies like outreach and sales law can persist IQ and a whole list of others that can you serve that market and ends up being that there are large markets there companies that are north of 50 million 6070 millionaire are just servicing what you would think is too much of a niche product but in the grand scheme of things it ends up being where the riches are in the niches so let me just pause here before I go to the third one we
(06:54) just pause here for a second if you start to see how creating an ICP writing it down and crafting it in a way where it actually filters to a small group of people as possible so that you then even force yourself to actually niche down even more if you’re started seeing how that’s very powerful just take a moment and just put a yes in the comments below when you actually niche down in this way when you focus on a very very tiny small market everything becomes easier your messaging becomes easier you’re no longer trying to come up with that
(07:25) messaging that hedges for all the use cases you focus on one once you make messaging that really resonates with a small group of people it becomes easier to approach those people it becomes easier to have conversations with those people attract their attention get them to try your product and at the end of the day customer conversations is what matters the most so when you get the ICP right customer conversations start to increase when you do that you’re able to operate the two levers that a star founder really has you have to leverage
(07:52) that star founder one is ship code and close deals ship code and close deals there are the two most important things and when you’re able to actually whittle it down and shrink it you’ll be able to have customer conversations ship code ship the right code and close deals and get that initial traction and guess what the ICP that you define is not written in stone so once you go after that niche and once you get those riches you then earn the right to actually work outward you get to work outward towards your
(08:19) bigger ICP and then from there you get to expand your ICP and go after bigger and bigger and bigger problems Amazon is a perfect example of this they started with a very very specific niche they wanted to sell books online books online once they conquered that then they went on to bigger and bigger things whereas now they sell everything to everyone all the way down to AWS and drones and space they’re everywhere but there are the right to do that because they niche down which brings me to my third thing so often start off founders get a little
(08:52) confused about well how do I write that ICP and how do i niche down and how I know it’s the right niche and how I know so right group of people so I always give them three filters that you want to think about and you want to find how to apply these three filters to your list so that you really really focus in on the group that matters the most the first thing that matters the most is that they have an urgent problem if they have a problem but it’s not urgent they’re not gonna move they’re not gonna try a product one of the toughest things
(09:18) about the early days of a starv is when you talk to customers you pitch them what you’re doing you tell them what you’re working on how you fix it they always say yeah I love it that’s awesome like sign me up but until they put down a credit card until they sign a deal until they give you dollars you don’t really know if they’re lying or telling the truth you don’t really know if it’s an urgent enough problem so you want to suss out in the early days are you just solving a problem or you solving an urgent problem
(09:43) the next thing you need is you need people that have an early adopter mindset and early adopter mindset ensures that they’re willing to try you’re kind of buggy kind of early product it’s gonna get better over time you’re gonna earn the right to do more you want those early adopters that are willing to try on early product and actually give you feedback and work with you you want to make sure they have an early adopter mindset so often I mean founders that are like HP the biggest enterprise will want this IBM will want
(10:10) this Amazon like everyone will want but yes but if they don’t have an early adopter mindset you’ll never know for sure so you always want to whittle them down an early adopter mindset the third thing is they have to have budget for this so often you can go after buyers then you’re solving a problem for them and maybe it’s urgent maybe they’re merrily adopter mindset but they have no money have no budget they have no money to spend and this is true whether you’re in b2b or b2c you can’t go after broke people so if you
(10:37) focus on these three things that Center of that is where the riches are and remember the riches are in the niches I didn’t come up with that it’s just a saying I love there’s a book on it you can google it so what you want to do is find people that have budget has an urgent problem and have an early adopter mindset so in summary when you start to embrace this ICP as a growth tool start to get very specific about defining a small of an ICP as possible at least for starters even within that smaller ICP you want to find a niche
(11:08) where the riches are you want to get very very specific because that will make your marketing collateral your customer conversation to your sales deck your demos everything a lot easier and once you solve for that once you solve that specific small tiny spec you earn the right with the money in the traction the growth to go bigger and solve bigger problems and as you’re building out your ICP you want to make sure that they have budget they have an urgent problem and they have an early adopter mindset now you know why using an ICP is such an
(11:36) important growth tool when you actually use an ICP the right way it helps you operate the two levers that matter most as a Star founder ship code and close deals on my next episode I’m gonna walk you through how to create an ICP literally step by step I’ll show you how to create an ICP using the right attributes and once you do that in the following episode I’ll walk you through how to actually implement it so be sure to hit the subscribe button in the bell icon if you’re not subscriber that way you’ll get notified when I launch those
(12:06) episodes also I put together an entire playlist you can follow here or here where I have all my related videos of all other growth tools that I teach starter founders to build an unstoppable strategy for growth in your startup if you really want to create a growth strategy for your startup there’s six key areas that you need to look at six and I created a guide that you can look at it makes it super easy to understand those answer simple questions to create a one-page strategy for your startup so if you’re interested in that the guide
(12:38) is completely free you can follow the link below so that you can download it and create a strategy for yourself now I love doing these videos because I love working with Stara founders so as you’re working through this if you want to continue the conversation be sure to comment below you can also email me TK at get unstoppable com you can follow me on Twitter or Instagram I’m everywhere and I want to connect with more star founders like you they’re looking to grow their startups with an unstoppable strategy finally if you like
(13:06) this video please hit the like button it means the world to me and my team the reason it’s important is because when you hit the like button it tells YouTube that this is valuable content and that way we can reach more star founders like you and help you and by the way if you’re part of a slack group or an email list with other star founders please share this channel please show this video it would mean the world to us and finally remember most importantly everyone needs a strategy for their life and their business when you’re with us yours is
(13:35) going to be unstoppable I’m TK and I will see you next Sunday
Summary:
An Ideal Customer Profile (ICP) is essential for startups aiming for targeted growth. A well-crafted ICP narrows down your audience to those customers most likely to bring value and help your business gain traction. While many founders may initially think about a broad customer base to attract investors, focusing on a specific, documented ICP can greatly accelerate progress by honing in on a niche with the highest immediate potential. Writing down your ICP is the first step, as it clarifies your target and streamlines your approach to reaching them.
Finding a niche within your ICP is critical for growth. Starting with a smaller, highly targeted group allows for a more focused marketing strategy and customer engagement, making it easier to deliver specific messaging and build momentum. This strategy often enables faster traction and positions the business for successful expansion. In the early days, for example, a company might concentrate on a subset of users who demonstrate the most pressing need for the product. For a startup offering sales software, this could mean targeting SDRs and sales reps who need to build a pipeline rather than a broad sales audience.
A great ICP meets three essential criteria: the problem is urgent for customers, they have an early adopter mindset, and they possess a budget to invest. Urgency motivates customers to act immediately, early adopters are open to trying new solutions and providing feedback, and customers with a budget are able to commit financially to the product. Aligning with these criteria ensures a stronger connection with customers and increases the likelihood of early traction.
Focusing on a clearly defined ICP simplifies customer conversations and product development. Messaging becomes sharper, and the customer acquisition process is smoother. Once a startup finds success with this focused group, it can gradually expand its ICP to capture larger market segments, building a broad customer base over time. This approach mirrors Amazon’s journey from a niche online bookseller to a multi-sector giant. The ICP strategy of starting narrow and growing outward helps startups establish a firm foundation for sustainable growth.