Angry customers are all your fault
It isn’t every day that a hungry prospect is banging down your company’s door, with a large wad of cash (or check, credit card, etc.) in hand, begging you to take their money. It’s even rarer when you — especially if you’re a new, early-stage, sales-starved, or cash-strapped founder — dread the next action you know you need to take: turning them away.
But why on earth would you possibly turn away a solid customer with money in hand? Isn’t sales, interest, and proof of concept what we’re all after as entrepreneurs? Perhaps, but successful entrepreneurship and startup longevity require the discernment to know the difference between a worthwhile client and a trap. In this case, I knew better than to take the bait.
Why? There were many reasons; to name a few:
This “eager prospect” had already purchased from us before — and they’d proven to be among the highest maintenance, asking for far more than they’d paid. Apparently, they’d appreciated the service enough to return, but that didn’t make it worth our while to continue to provide.Per their prior M.O., they were again requesting special discounts and unorthodox payment plans, yet demanding our most premium (and expensive) service offering…And if those red flags weren’t enough to give us pause, I had an email in my inbox from an industry peer CEO (at a non-competitive company with which we partner), specifically warning us why they had turned away this prospect as a “bad fit”…leaving thousands of unearned dollars on the table.
It didn’t matter if it was our “down season” or if this client’s purchase would add another couple of months of runway to my startup’s reserves (if we were in such dire financial straights). The writing was on the wall, in the email, and clear as day: Accepting this prospect’s money would likely cost us more than it was worth, and the short-term financial gain wouldn’t outweigh the time loss, headache, or potential reputational damage to follow.
But let’s be honest: Most problematic prospects don’t come with such blatant red flags warning us to promptly turn away their business. Furthermore, as a startup founder…