Vertical Testing: Applying ICP to Specific Industries
Purpose: Test ICP criteria against specific verticals to validate qualification Status: Testing Framework Last Updated: 2025-01-16
How to Test a Vertical Against ICP
Our ICP Principle: We organize our ICP around company maturity, not industry or title. This means any vertical can fit if they meet the maturity/stage criteria.
Testing Framework:
- Identify where companies in this vertical fall on growth stages
- Map their pain points to our ICP pain points
- Assess if they meet budget/authority/need/timeline criteria
- Identify vertical-specific signals and red flags
Vertical: Home Services Companies
Overview
What are Home Services Companies?
- HVAC, plumbing, electrical, roofing, landscaping, pest control
- Often multi-location (franchise models)
- Service-based with field operations
- Typically local/regional but some are scaling nationally
Important Note: For home services, we ONLY target Scale Ups (100M revenue) and Enterprise (30M) in this vertical because they typically haven’t raised substantial funding and want to build before they can afford our services.
Growth Stage Mapping
Scale Up Stage (100M ARR/GMV) - Home Services
Who They Are:
- 100M revenue home services companies
- 10+ locations, scaling nationally or regionally
- Franchise models or corporate-owned expansion
- Have raised substantial funding or have strong cash flow
What’s Broken (Applied to Home Services):
- Growth slowing: Can’t efficiently add new locations, acquisition costs rising
- Conflicting numbers: Sales says one thing, operations says another, finance sees different numbers
- Analytics bottlenecked: Can’t get insights fast enough to make decisions across locations
- AI tools underused: Have tools but not integrated into daily operations
- [Specific pain points from actual clients to be added]
Why They’d Hire Us:
- Need one view of the business across all locations
- Clear answers: Which locations should we invest in? Which services are most profitable?
- Operationalize analytics: Get field teams, dispatchers, and sales using data daily
- Optimize multi-location operations at scale
Our Role:
- Create single source of truth across locations
- Surface growth constraints (which locations, which services)
- Operationalize analytics for dispatch, pricing, service mix
- Turn data into growth leverage across locations
Deal Size: 40K/month
Vertical-Specific Signals:
- ✅ 10+ locations with expansion plans
- ✅ Using tech stack (dispatch, CRM, etc.) but data siloed
- ✅ Asking “which locations should we prioritize?”
- ✅ Pricing/promotions not optimized by location/service
- ✅ Field team scheduling inefficiencies
- ✅ $30M+ revenue (have raised funding or strong cash flow)
- ❌ Still manual operations across locations
- ❌ No tech infrastructure to connect
- ❌ <$30M revenue (too early stage - Startup stage excluded for home services)
Note: For home services, we target Scale Ups (100M) and Enterprise (30M) in this vertical. See Scale Up section above for details.
Enterprise Stage ($500M+ ARR/GMV) - Home Services
Who They Are:
- $500M+ revenue home services organizations
- National operations, hundreds of locations
- Franchise systems or large corporate operators
What’s Broken (Applied to Home Services):
- Complexity outpacing insight: Too many locations, too many services, can’t see patterns
- Manual workflows: Still manual processes killing speed at scale
- Decision-making not scaling: Can’t make data-driven decisions fast enough across locations
- Too many tools: Have tools but not integrated, creating drag
Why They’d Hire Us:
- Need AI and automation embedded into operations
- Not another layer of tools
- Scale decision-making across hundreds of locations
- Preserve velocity while scaling intelligence
Our Role:
- Design and deploy AI systems that scale decision-making
- Automate pricing, dispatch, inventory decisions
- Preserve velocity while scaling
- Fight bureaucracy with intelligence
Deal Size: 100K+/month
Vertical-Specific Signals:
- ✅ Hundreds of locations, complex operations
- ✅ Modern tech stack but not integrated
- ✅ Need automation for pricing, dispatch, inventory
- ✅ Decision-making too slow across locations
- ❌ Traditional enterprise, slow procurement
- ❌ Rigid scopes, can’t move fast
- ❌ No modern tech infrastructure
Vertical-Specific Qualification Questions
For Home Services Companies (Scale Ups & Enterprise Only):
-
Company Stage (Must Qualify First):
- What’s your revenue? (Must be 500M+ for Enterprise)
- How many locations do you operate? (Must be 10+ for Scale Ups)
- Have you raised substantial funding or have strong cash flow?
- Are you planning to expand to more locations?
- Red Flag: If <$30M revenue, disqualify (too early stage - Startup stage excluded for this vertical)
-
Current Data/AI State:
- How do you currently track job profitability?
- What tools do you use for dispatch/scheduling?
- How do you make pricing decisions?
- Do you have a CRM or customer database?
- Are your systems integrated or siloed?
-
Pain Points:
- What’s broken with your current operations?
- Can you answer “which locations/services are most profitable?”
- How do you handle scheduling/dispatch across locations?
- Are your field teams and sales team using the same data?
- [Specific pain points from actual clients to be added]
-
Budget & Authority:
- What’s your budget for this type of work? (Must be 40K/month for Scale Ups, $40K+/month for Enterprise)
- Who makes decisions on operational improvements?
- Is there executive ownership of data/AI initiatives?
- Red Flag: If no budget or seeking cheap execution, disqualify
-
Timeline:
- What’s driving urgency? (Expansion plans? Competitive pressure? Board pressure?)
- When do you need to see results?
- Red Flag: If no urgency or timeline, may not be qualified
Vertical-Specific Red Flags
For Home Services (Scale Ups & Enterprise Only):
Disqualify If:
- <$30M revenue (too early stage - Startup stage excluded for this vertical - most common)
- <10 locations (too small for Scale Up stage)
- Haven’t raised substantial funding or don’t have strong cash flow
- Still using paper/whiteboards for core operations
- No CRM or basic tech infrastructure
- Can’t afford $20K+/month (too early stage)
- Traditional franchise model with no corporate decision-making
- Looking for cheap execution, not leverage
- Not planning to scale (happy staying small/local)
- Single location or very few locations
Common Disqualification Reasons:
- Too early stage (<$30M revenue) - Most common for this vertical (Startup stage excluded)
- Haven’t raised substantial funding - Very common (want to build before they can afford us)
- No tech infrastructure to build on - Common
- Wrong buyer intent (want cheap execution, not leverage) - Common
- Traditional franchise with no corporate authority - Common
Vertical-Specific Success Signals
Strong Fit Signals (Scale Ups & Enterprise Only):
Scale Up Stage (100M revenue):
- ✅ $30M+ revenue (substantial funding or strong cash flow)
- ✅ 10+ locations, actively expanding
- ✅ Have tech stack but data siloed across tools
- ✅ Asking “which locations should we invest in?”
- ✅ Need to optimize dispatch, pricing, service mix
- ✅ VP/Director level decision maker with authority
- ✅ Can afford 40K/month
Enterprise Stage ($500M+ revenue):
- ✅ $500M+ revenue, hundreds of locations, national operations
- ✅ Modern tech stack but not integrated
- ✅ Need automation for operations at scale
- ✅ C-level decision maker with strategic vision
- ✅ Can afford $40K+/month
Test Questions for Home Services Companies
Use these to quickly qualify (Scale Ups & Enterprise Only):
-
“What’s your revenue?” (MUST ASK FIRST)
- <$30M → Disqualify (too early stage - Startup stage excluded for this vertical)
- 100M → Potential Scale Up stage fit (10+ locations required)
- $500M+ → Potential Enterprise stage fit (hundreds of locations)
- Won’t share → Ask about locations and funding instead
-
“How many locations do you operate?”
- <10 locations → Likely too small (unless $30M+ revenue with expansion plans)
- 10-50 locations → Potential Scale Up stage fit (if $30M+ revenue)
- 100+ locations → Potential Enterprise stage fit (if $500M+ revenue)
- Single location → Disqualify
-
“Have you raised substantial funding or have strong cash flow?”
- Yes, raised funding → Good signal
- Yes, strong cash flow → Good signal
- No, want to build before they can afford us → Disqualify (most common reason)
-
“How do you currently track job profitability?”
- “We don’t” or “In spreadsheets” → Strong fit (pain point identified)
- “Our accounting software” → Potential fit (may need integration)
- “We have a system but it’s not working well” → Strong fit
- “We have a sophisticated system” → May not need us (unless they want AI/automation)
-
“What’s driving your need for better data/AI?”
- “We’re expanding and need to scale operations” → Strong fit
- “We can’t answer basic questions about profitability” → Strong fit
- “Our tools don’t talk to each other” → Strong fit
- “We’re curious about AI” → Weak fit (not urgent)
- “We’re fine, just exploring” → Disqualify
-
“What’s your budget for this type of work?”
- <$20K/month → Disqualify (too early stage)
- 40K/month → Scale Up stage fit (if $30M+ revenue)
- 500M+ revenue)
- “We’re not sure” or “We don’t have budget” → Disqualify
Example: Testing a Home Services Company
Scenario: HVAC company with 15 locations, $50M revenue, raised Series B
ICP Analysis:
Growth Stage: ✅ Scale Up stage (100M revenue, 10+ locations)
- Matches Scale Up stage criteria
- Multiple locations indicate scaling
- Substantial funding indicates ability to afford services
Pain Points:
- Need to understand: Do they have conflicting numbers? Analytics bottlenecks?
- Can they answer “which locations/services are most profitable?”
- [Will add specific pain points from actual clients]
Budget:
- Need to understand: Do they have 40K/month budget?
- Are they looking for leverage or cheap execution?
Authority:
- Need to understand: Who makes decisions? Operations VP? C-level?
- Is there executive ownership?
Timeline:
- Need to understand: What’s driving urgency? Expansion plans? Board pressure?
Qualification Score (Hypothetical):
- Company Fit (ICP): 9/10 (fits Scale Up stage, $30M+ revenue)
- Decision Maker: ?/10 (need to identify)
- Pain Point: ?/10 (need to identify pain)
- Budget: ?/10 (need to confirm 40K/month)
- Timeline: ?/10 (need to understand urgency)
Action:
- ✅ Qualify for conversation (meets Scale Up criteria)
- Ask qualification questions above
- Score after discovery
Example: Disqualified Company
Scenario: HVAC company with 3 locations, $15M revenue, bootstrapped
ICP Analysis:
Growth Stage: ❌ Too early stage (<$30M revenue)
- Does not meet Scale Up criteria (Startup stage excluded)
- Too small for this vertical
- Likely can’t afford services yet
Action:
- ❌ Disqualify - Too early stage for home services vertical (Startup stage excluded)
- Note: They may be a fit later when they reach $30M+ revenue (Scale Up stage)
Applying This Framework to Other Verticals
To test any vertical:
- Determine which growth stages apply to that vertical (may not be all stages)
- Map companies in that vertical to applicable growth stages (by revenue/stage, not industry)
- Identify vertical-specific pain points that map to our ICP pain points
- Define vertical-specific signals and red flags
- Create qualification questions for that vertical
- Test against real companies
Key Principle: Industry doesn’t matter - maturity/stage does. However, some verticals may only fit certain stages. For example, home services only fits Scale Ups ($100M+) and Enterprise, not Startups.
Status & Next Steps
Current Status:
- ✅ High-level testing framework created for home services
- ✅ Focused on Scale Ups (100M) and Enterprise ($500M+) only
- ✅ Startups (<$30M) excluded for this vertical
- ⏳ Waiting for specific pain points from actual clients
- ⏳ BDR/AE tactics not yet captured (will add later)
Next Steps:
- Add specific pain points from actual home services clients
- Test framework on real home services companies
- Refine based on learnings
- Add BDR/AE tactics once those are captured
- Apply framework to other verticals as needed
Note: This is a high-level framework. Will be refined with actual client pain points and BDR/AE tactics.