Imagine itโs 2008, and Tesla is unveiling the Roadsterโa sleek electric car that doesnโt ask you to compromise. Itโs fast, luxurious, andโsurpriseโdoesnโt cost more than a comparable sports car. Tesla didnโt market it as a โgreen vehicleโ with a hefty price tag to save the planet. Instead, it sold status, performance, and design while quietly slipping in a climate solution. Thatโs the power of a 10x value proposition versus relying on a green premium.
๐ช๐ต๐ฎ๐โ๐ย ๐๐ต๐ฒย ๐๐ถ๐ณ๐ณ๐ฒ๐ฟ๐ฒ๐ป๐ฐ๐ฒ?
* ๐๐ฟ๐ฒ๐ฒ๐ปย ๐ฃ๐ฟ๐ฒ๐บ๐ถ๐๐บ: Charges extra for being environmentally friendly, relying on customersโ willingness to pay more to โdo the right thing.โ The reality is that itโs an added cost that most people avoid unless required by regulations. A good example is solar and wind energy in the past few decades. Their prices were often fixed in so-called power-purchase agreements, and they were several orders of magnitude higher than prices from conventional energy sources like coal and gas.ย
* ๐ญ๐ฌ๐ ย ๐ฉ๐ฎ๐น๐๐ฒ: Offers a product or service thatโs 10 times better in performance, cost, or experience than existing options. Customers flock to it because it solves a problem or enhances their lives or their business in a clear, undeniable way.
Tesla succeeded because it understood this fundamental truth: People donโt buy products just because theyโre greenโthey buy them because theyโre better.
๐๐ผ๐ย ๐๐ผย ๐๐ป๐ผ๐ย ๐๐ณย ๐ฌ๐ผ๐ย ๐๐ฎ๐๐ฒย ๐ฎย ๐ญ๐ฌ๐ ย ๐ฃ๐ฟ๐ผ๐ฝ๐ผ๐๐ถ๐๐ถ๐ผ๐ป?
1๏ธโฃ ๐ฆ๐๐ฎ๐๐๐: Does your product elevate your customerโs position or prestige? Tesla nailed this by making EVs a luxury symbol. Leonardo DiCaprio ditched his Prius the moment Roadster became available.
2๏ธโฃ ๐ฆ๐ฎ๐ณ๐ฒ๐๐: Can your product make customers feel safer or more secure? Think of energy-as-a-service or manufacturing-as-a-service business models that avoid CAPEX or disaster-proof technologies.
3๏ธโฃ ๐ช๐ฒ๐ฎ๐น๐๐ต: The basic one - does it deliver 10x financial returns? In Climatetech this would usually mean cost savings or a completely new market opportunity. Iโve seen a lot of startups offering 30% cost savings, that got nowhere.ย
You have a scalable value proposition if your cleantech startup can deliver 10x in one of these areas.
๐ง๐ต๐ฒย ๐ง๐ฎ๐ธ๐ฒ๐ฎ๐๐ฎ๐
So, what would it be - A Christmas tree or presents? If your climate tech startup leans heavily on green premiums, rethink your strategy. Focus on delivering a 10x value proposition in status, safety, or wealth. Thatโs how youโll attract mainstream customers, secure investor confidence, and achieve scale.
Want more insights on scaling cleantech? Follow me here for deep dives into what makes scaleups work. Merry Christmas, and letโs build the futureโ10x better!