Here's the Letter of Intent used by the MenuClue team at Lean Startup Machine London.
Patrick Vlaskovits is also famous for using LOIs and Mockups to get customer validation. Check out his case study on Venture Hacks.
Letter of Intent Template by Lean Startup Machine
This LOI's Strengths:
This LOI's Weaknesses:
- Simple and straight-forward.
- Repeats the value proposition at the top "MenuClue, the tool for helping restaurant operators to make more money from their menus."
- Tone is enthusiastic, they add the words "It sounds interesting." to the customer's voice.
- Explains the product's features in detail in the fine print "by allowing you to propose changes to my menu (e.g. layout, design, pricing, dish description, etc)"
Split Testing LOIs
A good strategy is to start with a fairly week LOI like this one and reduce the "escape clauses," and increase the commitment required as more customers sign them (this is also called the decreasing discount MVP). You can also split-test the features on the contract or have the customer suggest edits to get a better match for what he or she really wants.
- LOI is a little too weak, the higher the customer has to jump the more validated your concept, too much of the letter feels like, "Ok, I can very easily get out of this."
- The value proposition is stated as "make me more money" which is a generalization and not a match with the product. Like saying, "Our value proposition is to deliver value." Would have focused on the problem this team is solving, ie. "menu is uninteresting, ugly, or underpriced."
- By default this letter is non-binding, I would never put "non-binding" in the header and in this case would remove it from the fine print.
- Too many "escape clauses," ie. (no cost to you, change your mind, this is non-binding, you must accept). Good to have one of these maybe two.
- The LOI should require an email address and phone number.