Testing Demand for a Climate or Impact Business

A climate solution can address an urgent problem and still struggle to find customers. The people who benefit may be different from those who control the budget. A buyer may support the mission while lacking the authority, resources or incentive to act.

In our conversations with founders whose ventures had to close, difficulty finding product-market fit was a recurring concern. That does not explain every closure, but it raises a useful question for any early team: what evidence shows that a specific customer wants this offer on terms the business can deliver?

Customer discovery makes that question concrete. It asks how the problem is handled today, what it costs, who is involved and what would have to change before a purchase could happen. Enthusiasm is useful feedback. A credible route to a buying decision tells you more.

What is product-market fit?

Product-market fit means an offer meets a meaningful need in a market that can sustain it. Evidence can include paying customers, repeat use and a purchasing process that becomes more understandable as the business gains experience. The relevant signals depend on the product and how it is bought.

For a climate venture, distinguish the environmental benefit from the buyer’s immediate reason to act. A solution might reduce waste while also helping a customer address material costs, operating requirements or supply concerns. Test those reasons with the people making the decision.

A strong explanation helps a buyer assess the offer. It cannot create a budget or resolve a technical limitation by itself. Discovery needs to examine those constraints alongside the message.

Three stages for testing demand

Use these stages to organise the learning. Return to earlier assumptions when the evidence changes:

1. Test the problem and the proposed customer.
2. Validate the offer with a focused group of buyers.
3. Expand around the strongest evidence of demand.

1. Hypothesis testing: what problem are you solving?

Write a specific statement about the customer, the problem and the proposed reason to buy. Make it narrow enough to investigate. “Businesses need to become more sustainable” does not tell you who to interview or what behaviour would support your idea.

For example, you might test whether:

• A food manufacturer will trial a different packaging material if it meets performance requirements and reduces disposal costs.
• A building operator will assess an energy-saving system if installation can fit its maintenance schedule.

These are hypotheses, not established market facts. Ask potential customers to describe recent decisions and existing workarounds before presenting your preferred answer.

• Customer interviews: find out what happened the last time the problem occurred, who dealt with it and how a response was funded.
• Problem and solution fit: identify which requirements would make an alternative worth considering, and which would rule it out.

Practical step: keep a short record of each assumption, the evidence supporting it and the next question to test. Separate what someone said they liked from what they are prepared to do.

2. Market validation: test a focused set of customers

Different customer groups may value different parts of the same solution. Compare a small number of plausible segments before committing to one. The objective is to understand the buying conditions well enough to choose where to concentrate.

Those groups might include:

• Public organisations with defined budgets and procurement processes.
• Businesses with operating requirements and commercial targets.
• Consumers making individual purchasing decisions.

Avoid treating all three as one market. Identify the user, the person approving the purchase and anyone whose requirements could prevent adoption. In some organisations those roles sit with several people.

Once a segment looks promising, design a test around its most consequential uncertainty. A useful pilot should answer a question that matters to a future purchase, with the customer’s responsibilities and evaluation criteria agreed in advance.

Ways to test the offer:

• Run a bounded trial: choose a clear use case and define what the customer needs to learn. For example, test a material against an agreed specification or assess an installation in one suitable setting.
• Build the minimum useful version: use the simplest appropriate prototype or service that can test the assumption. Be clear about its limitations and what remains to be developed.
• Track meaningful progression: record movement from discussion to evaluation, from evaluation to a purchasing decision, and from initial use to repeat demand where that is relevant.

Look at why prospects stop as carefully as why they continue. Price, performance, internal approval and timing can point to different problems. A polite follow-up request is not the same as an agreed commercial next step.

Practical step: map the stages of the buying process and note what evidence or approval is needed at each one. Use that map to improve both the offer and the materials explaining it.

3. Scaling with focus: build on the strongest evidence

When one segment shows a repeatable need and a workable route to purchase, examine what it would take to serve more customers like it. Consider delivery capacity, implementation effort and support requirements alongside demand.

A successful pilot can still depend on unusual circumstances or substantial founder involvement. Understand which parts of the experience are repeatable before using it as the basis for expansion.

For climate and impact teams, this means:

• Deepening a promising use case: improve the offer and delivery process for customers with similar needs.
• Testing adjacent markets deliberately: identify what changes in the specification, buying process or economics before assuming the same approach will transfer.

Practical step: choose a small set of measures that connect demand with delivery, such as progress to paid work, implementation effort and repeat orders where appropriate. Review them together rather than treating attention or enquiries as sufficient evidence of a sustainable business.

Customer personas: understand the buying decision

A useful customer persona records what a person is trying to achieve, the constraints they face and how they participate in a purchase. Base it on conversations and observed behaviour. A fictional profile built around a job title can hide uncertainty behind a confident description.

For an industrial customer, distinguish the technical evaluator from the budget holder and the person responsible for implementation. They may assess the same offer using different criteria. Your materials should help them answer their questions and discuss the proposal with one another.

Update the profile when new evidence challenges it. The purpose is to improve your understanding of the buying decision, rather than to preserve a document created at the start of the project.

What about marketing and brand building?

Early teams need a clear proposition and enough credibility to test it with customers. Keep the scope of brand work proportionate while demand is being validated. A focused presentation, simple website and consistent explanation may be enough to support the next round of conversations.

As the audience and offer become clearer, there is a stronger basis for a fuller identity or website project. Brand work can help express what the business has learned and make the offer easier to assess. It should develop alongside that learning.

Before commissioning the next piece of communication, identify the question it needs to answer for the buyer. That gives both the business and its creative partner a concrete problem to solve.

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