Customers? I don't know who they are but I am sure I have them!

After just reading an article about market segmentation and target market selection I really started thinking. Who are my customers? I realized this was harder to answer than I thought. Having a business plan as a financial intermediary for social impact bonds, I had multiple constituancies that I had to be aware of, or more specifically their aims and product desires. I need to be aware of what investors wanted to invest in and the risk adjusted returns they are willing to bear. Since I am getting money from them, they are my customers, right? But wait... the government ultimately pays if they are a success, so they are my customers. No, no, that can't be right, because the ones actually doing work are the institutions which we allocate capital.. or does that mean that we are their customers?

So I have to appease investors, government policy makers, and institutions such as non-profits. Uh-oh what have I gotten myself into? I came to the realization that I needed to find an area that fits for all three. While there is a wide range of policy initatives that could be funded by social impact bonds, this sweet spot where the three parties come together may be much more narrow. I came to the conclusion that to increase my probablities of success, I would need to identify who my customers are and target them sufficiently.

My initial thoughts lead me to believe that I need to go after the government, or more specifically policy makers within the government, to garner support. I feel they are the lynchpin here and I would have difficulty filling their position in my business plan with any alternatives. Investors and non-profits/activist organizations are more numerous. By reaching out to staffers, etc. I would be able to focus in on the policy initiatives they would get behind. I believe that once I established the backing for certain initatives, others would follow, especially since I beleive the business my partner and I envision would deliver results at a reduced cost. Next, I would have to go after investors. I beleive they are the next step because they will want to have at least some say in were the money ends up. Finally, and still importantly, I would have to find organizations that are willing to operate in a manner consistant with other stakeholders and be proficient at collecting and diseminating results. A complicated process, but I guess no one said it would be easy...

... looks like I got some work to do!