The 6-Step Value Proposition Process for Founding Teams

Your first value proposition is going to be bad. Accept it now.

It'll be vague. It'll sound like everyone else. It'll describe features instead of outcomes. It'll target "everyone" instead of someone specific.

That's fine. Every founding team starts there.

The problem is when you stay there. When you put the vague, undifferentiated version on your website, in your sales deck, and in your investor pitch—and wonder why nothing lands.

Here's the process for taking a weak value proposition and shaping it into something that actually works. It's not waterfall—you'll loop back constantly. Test early, test often, and expect to revisit every step multiple times.

What "Useless" Looks Like

Before we fix it, let's name the patterns. Most early value propositions fail in predictable ways:

The feature dump: "We're an AI-powered platform with advanced analytics, seamless integrations, and real-time collaboration."

Translation: We built some stuff. No idea why you'd care.

The buzzword blanket: "We help companies transform their digital operations through intelligent automation."

Translation: We do... something? To someone? Maybe?

The "for everyone" trap: "Our platform helps businesses of all sizes improve productivity."

Translation: We haven't picked a customer, so we can't name a specific problem.

The competitor echo: "We're like [Competitor X] but better/faster/cheaper."

Translation: We don't know what makes us different, so we're borrowing their positioning.

If your current value proposition sounds like any of these, you're in the right place.

Step 1: Get the Bad Version Out

The first step isn't to write a good value proposition. It's to write down your current bad one so you can see what you're working with.

The exercise:

Each founder independently writes a one-paragraph version of the value proposition. Don't overthink it. Don't wordsmith. Just answer: "What do we do and why should anyone care?"

Then put all versions side by side.

What you'll see:

• Founders emphasizing different things
• Vague language nobody would argue with (or remember)
• Features masquerading as benefits
• No clear customer or problem

This is your starting material. You can't refine what you haven't named.

Output: A shared doc with everyone's first attempt, warts and all.

Quick test: Before moving on, run your draft past one or two people outside the founding team—an advisor, an early customer, a friend in your target market. Ask: "Does this make sense? What do you think we do?" If they can't answer, you have useful signal already. Don't wait until the end to discover your starting point is incomprehensible.

Step 2: Stress Test with the "So What?" Chain

Now take your draft positioning and run it through the "So What?" test until it breaks—or until you hit something real.

The exercise:

Read your value proposition aloud. After every claim, ask "So what?"

Example:

"We're an AI-powered analytics platform." So what?

"So you can get insights faster." So what?

"So you can make better decisions." So what?

"So you can... grow revenue?" Now you're getting somewhere. But keep going.

"So you can identify which campaigns are actually working instead of guessing." Better. That's a real pain point.

"So you stop wasting $50K/month on underperforming channels." Now you have an outcome someone cares about.

The rule:

If you can't get past three "so whats" without hitting a real business outcome, your positioning is stuck at the feature level. Keep pushing until you hit money, time, risk, or competitive advantage.

Output: A list of the real outcomes behind your features.

Quick test: Take the outcome you landed on and test it in your next sales call or customer conversation. Ask: "Is this actually the problem you're trying to solve?" If they say yes, you're onto something. If they look confused or pivot to a different pain, you need to run the chain again with different starting points.

Step 3: Force Specificity with the "Who Exactly?" Filter

Vague positioning comes from vague targeting. If you're trying to serve "companies" or "teams," you're not specific enough to say anything meaningful.

The exercise:

Take your current target customer description and keep asking "Who exactly?" until you can name a person.

Example:

"We sell to SaaS companies." Who exactly at SaaS companies?

"Marketing teams." Who exactly on marketing teams?

"Marketing leaders." Who exactly? What's their title? What size company?

"Director of Demand Gen at Series B-D SaaS companies with 50-200 employees." Now we're talking.

Once you have a specific person, ask:

• What does their Tuesday look like?
• What metrics are they measured on?
• What's the biggest pain point in their current workflow?
• What would get them promoted?
• What would get them fired?

When you can answer these questions, you can write positioning that speaks directly to their situation—not generic value that could apply to anyone.

Output: A one-paragraph description of your ideal customer that's specific enough to be useful.

Quick test: Find 2-3 people who match your specific customer description. Show them your positioning and ask: "Does this sound like it was written for you?" If they say "kind of" or "not really," your targeting is still too broad—or you've picked the wrong segment. Go back to Step 1 with a narrower focus.

This is also where you might discover you've been wrong about who you're actually serving. If prospects keep saying "this isn't me, but I know someone who'd want this," follow that thread. Your real customer might be one degree removed from who you assumed.

Step 4: Differentiate with the "Only We" Test

Most differentiation fails because it's not actually different. It's either table stakes (everyone has it) or irrelevant (nobody cares).

The exercise:

Complete this sentence honestly:

"We're the only [product category] that [differentiator]."

Now stress test it:

1. Is it actually true? Can any competitor claim the same thing? If yes, it's not differentiation.

2. Does it matter? Would your target customer pay more or switch for this? If no, it's not valuable differentiation.

3. Can you prove it? Do you have evidence—customer results, benchmarks, technical specs—that back it up? If no, it's just a claim.

Common failures:

• "We're the only platform with great customer support." (Everyone says this.)
• "We're the only solution with AI." (Every solution has AI now.)
• "We're the only one built by practitioners." (Every founder says this.)

What good looks like:

• "We're the only competitive intelligence platform that auto-generates battlecards from CRM data."
• "We're the only PLG analytics tool with native warehouse integration—no data extraction required."
• "We're the only spend management platform that gives department heads real-time budget visibility without finance bottlenecks."

If you can't pass the "Only We" test, your differentiation needs work. Either find something genuinely unique or combine multiple things in a way competitors don't.

Output: A single differentiator that's true, matters, and you can prove.

Quick test: State your differentiator to a prospect and ask two questions: "Have you heard other companies say something like this?" and "Would this change how you evaluate options?" If they've heard it before, it's not differentiation. If it wouldn't change their evaluation, it's not valuable. Either way, go back and try again.

You might loop here several times. Most teams need 3-4 attempts before landing on differentiation that's actually unique and actually matters.

Step 5: Stress Test with Stakeholders

Positioning developed in a box dies in the market. Before you lock anything, you need to run it past the people who will use it—and the people you're trying to reach.

The internal test: Sales and CS

Your sales team will immediately tell you if positioning is usable. Your CS team will tell you if it matches what customers actually experience.

Run a 30-minute session:

1. Read your draft positioning aloud
2. Ask sales: "Could you use this in a cold call? What objections would you expect?"
3. Ask CS: "Does this match what customers say after they've bought? Where's the gap?"

What you'll hear:

Sales will push back on anything too abstract. "I can't say 'intelligent automation' on a call—what does that actually mean?" Good. That's a sign your positioning is still too vague.

CS will flag expectation mismatches. "We say we save 10 hours a week, but most customers report 3-4." Good. That's a sign your claims need calibration.

The external test: Prospects and customers

Internal feedback isn't enough. You need to hear from the market.

With prospects (5-10 calls):

• Read your one-liner. Ask: "What do you think we do?"
• Describe your target customer. Ask: "Does that sound like you?"
• State your differentiator. Ask: "Does that matter? Would that change how you evaluate us?"

If they can't play it back, or the differentiator doesn't land, you're not done.

With existing customers (3-5 calls):

• Ask: "Why did you actually buy?"
• Ask: "How would you describe us to a peer?"
• Ask: "What almost made you not buy?"

Customers will tell you what your positioning should be. The language they use is often better than what founders come up with in a conference room.

What to do with the feedback:

You'll hear patterns. Some things will land consistently—keep those. Some things will confuse everyone—cut those. Some things will resonate with customers but not prospects—those might be better for retention messaging than acquisition.

Refine. Then test again if needed.

Output: A pressure-tested positioning that's been validated by the people who have to use it and the people you're trying to reach.

The loop back: This step will almost certainly send you back to earlier steps. That's the point. If sales says your differentiator doesn't land, go back to Step 4. If customers describe a different problem than you expected, go back to Step 2. If prospects say "that's not me," go back to Step 3.

You might run through Steps 1-5 three or four times before you have something ready to lock. That's normal. The teams who skip this iteration are the ones who end up with positioning that sounds good in the boardroom but dies in the market.

Step 6: Lock It with the Positioning Template

Now you have the raw material. Time to assemble it into a format that's usable and repeatable.

The template:

For [specific target customer] who [specific problem or pain point], [Product name] is [product category] that [primary benefit—the "so what" outcome]. Unlike [primary alternative], we [key differentiator from "Only We" test].

Example of refinement:

Before (vague): "Segment8 helps marketing teams work more efficiently with AI-powered automation."

After (specific): "For B2B SaaS product marketing teams who spend 10+ hours per week on manual competitor tracking and launch coordination, Segment8 is an AI-powered PMM workspace that automates the repetitive GTM work so you can focus on strategy. Unlike generic project management tools or cobbled-together spreadsheets, we're purpose-built for product marketing workflows and integrate directly with your existing stack."

The second version is longer, but it's clearer. A product marketer reading it immediately knows if it's for them. A sales ops person reading it immediately knows it's not.

The test:

Read your positioning aloud to someone who doesn't know your company. Ask them:

• "Who is this for?"
• "What problem does it solve?"
• "Why would someone choose this over alternatives?"

If they can answer all three correctly, your positioning is landing. If not, it needs more work.

Output: A locked positioning statement that passes the readback test.

The Refinement Loop

Positioning isn't done after one pass. You'll refine it as you learn:

Refine when you hear objections repeat. If every sales call hits the same objection, your positioning is creating the wrong expectation. Adjust.

Refine when you win unexpected deals. If you're winning customers you didn't target, figure out why. There might be a better positioning angle hiding in those wins.

Refine when competitors copy you. If your differentiation becomes table stakes, find the next level of specificity.

Don't refine based on one data point. Wait for patterns. A single lost deal or one piece of negative feedback isn't a signal—it's noise.

Templates for Your Team

Positioning Refinement Worksheet

The "So What?" Chain

Start with your current positioning claim and push until you hit a real outcome:

• Claim: _______________
• So what? → _______________
• So what? → _______________
• So what? → _______________
• Real outcome: _______________

The "Only We" Test

Complete and verify:

"We're the only _____________ that _____________."

• [ ] Actually true (competitors can't claim this)
• [ ] Actually matters (customers would pay/switch for this)
• [ ] Actually provable (evidence exists)

What Changes When Positioning Works

When you go from vague to specific, things shift:

Sales calls get shorter. You're attracting the right people who already understand the problem.

Objections change. You stop hearing "what do you actually do?" and start hearing "how does pricing work?"

Marketing gets easier. Everyone knows what to say because the positioning is clear.

Product decisions get clearer. You can evaluate features against "does this reinforce our positioning?"

Hiring gets better. Candidates self-select because they understand the mission.

The goal isn't a perfect sentence. The goal is shared clarity that shows up in every decision your company makes.

Your first value proposition was always going to be bad. Now you know how to make it better.