writes about creating a selling strategy for start ups with his experience with Invite Media which he sold to Google in 2005. Enjoy!
If you’re starting a company, you’re going to have to sell your product/service to potential customers (at least if you plan on making any money). This especially applies to enterprise software companies or B2B companies in general, as you’re selling to someone who’s job may ultimately be on the line for the “who we’re going with” decision (related post: The IBM effect
). Your company’s strategy and style of how you sell your product is extremely important, and like many other things in your startup’s life cycle, is critical to be aware of and get right. It’s the first impression you make on customers, may be the deciding factor on if you get the business, and depending on the company may end up being a major part of your culture.
First, I’m going to assume you’re building a product to the best of your ability and have built an effective product management process. This post is squarely about how you put that product in customer’s faces and win deals. At Invite Media, the company I co-founded, the core concepts of sales strategy became drilled in our head as we faced the market and encountered competitors. We learned we needed to be conscious of how we sold our product and the first interactions customers had with our company, very specifically, and needed to develop a sales strategy that we could teach others as we scaled the organization. In other words, it wasn’t enough to build the greatest platform we could. We by no means perfected it and more sales-focused organizations probably can do this stuff in their sleep over time, but we definitely came to appreciate it’s importance. Over time, as our sales strategy evolved, it ultimately influenced many other functions at our company, such as how we recruited people and raised money. Overall, the day we figured out how to put ourselves in our customer’s shoes was the day we learned how to effectively sell.
My first piece of advice on sales strategy at startups is to not oversell your product.
Aggressive sales tactics piss people off, and set a bad first impression. There’s nothing worse than a salesperson who doesn’t take no for an answer and talks out of his ass about the product and promises the moon, and worse is selling a shitty product to begin with. If your product sucks, fix your product. In other words, fix the root cause, don’t rely on sales to win deals. Companies who rely on aggressive sales tactics in order to win business in general are probably compensating for a weak product, at least in my experience (or are knowingly selling a scam). Even more disappointing is when a company has a great product but uses aggressive sales tactics and steps on their own toes with customers, as that’s something that was entirely avoidable. This unfortunately isn’t uncommon in startups, as many founders decide they can’t or shouldn’t sell and “check the box” by hiring a sales person, which can be extremely hit or miss and hard to do without prior experience (a topic for another day).
The reason this is important is that in ad technology (and in most spaces probably), we learned that the best platform/technology doesn’t necessarily win every deal.
Like in sports, that’s why they play the games (i.e., don’t declare a winner based on who has the best team at the start of the season). In startups, sales strategy is an important part of the game. You obviously have to have a great product to ultimately be successful, but you also have to be smart about how you sell it. In other words, the winner of a deal will have a combination of both a great product and a great sales strategy, and rarely does one win being extremely heavy on one side. As an investor or acquirer, if you did have a company on one end of the spectrum and thus wasn’t properly balanced, you’d obviously love to see a company on the “great product, horrible sales strategy” side, as fixing sales strategy is way easier than fixing a shitty product. This even applies to companies with no actual sales people and a purely self-service system, whereby the sales strategy ends up becoming your accessible messaging, how you offer the product online, etc…
At Invite, our sales strategy was very simply “educate the potential customer on the Invite platform, answer any and all questions, and be confident that we have the best platform and that they’ll ultimately chose us.” As a side note, that doesn’t mean we took the initial meeting and then just sat around and hoped they emailed us back; we did our fair share of following up on next steps and checking in if we had mutual expectations to move the process along, but we made sure to never cross the line of being aggressive. Ultimately, if the customer picked someone else because the platform was lacking in an area they required, either we needed to decide to fix that in our product or decide that client wasn’t a fit for us because what they were asked for wasn’t going to be in our roadmap (and both happened a lot). That’s why things like the product feedback cycle
(i.e., reducing the number of “layers” between a client’s product feedback and your engineering team) are important, which I’ll mention again later in this post. These are the kind of questions you’ll need to go through, and it took us while to get there (and still wasn’t perfect).
My second piece of advice is think extremely hard about the incentives you give your sales team.
The world is run on incentives. You as a startup founder are incentivized
If you do hire sales people, hire sales people who can discern what clients are asking for in your product and can effectively work with your product and engineering teams to improve the product based on that feedback.
That doesn’t mean hire a sales person who can code, as that’s a rare thing, but hire a sales person who is comfortable with technology if you’re a technology company, is smart enough to dig into basic tech details, and is a willing and capable listener but also communicator (what good is listening if you do a crappy job of explaining what you heard to the person who needs to build it?). It’s always a scary thing when you see a young company with a product that’s still evolving put a junior or incapable sales person in front of their early clients, and the customer provides all sorts of valuable product feedback that you know won’t ultimately get back to the engineering team in a meaningful way (or worse yet, doesn’t get the feedback in the first place because he didn’t know what questions to ask or didn’t given the customer a chance to speak). Customers really appreciate sales people who understand their needs, understand the product, take the time to listen, and can trust that what they’re telling them is actually being taken back to the engineering team properly. This will build confidence in your product and team that the customer can rely on. It all starts with that initial sales strategy. That’s another reason why it’s great to see founders do a lot of the initial sales, as the product feedback is never more important than then and the founder(s) should know their product better than anyone else at the company.
Another important step is to as the founder, lead and help craft a definition of and a list of characteristics of who your ideal customers are.
This is especially important in B2B companies, as every company is different and can be highly complex. If your industry is small enough, this may be an actual list of potential customer names. Making mistakes here are hard to fix if you bring on a customer that isn’t a fit (for both sides). It’s kind of like a golf swing and alignment. You could have the greatest swing in the world, but if you aim at the wrong target and still make the perfect swing (or perfect sales strategy), you’ll still miss. Do you work with agencies or advertisers, or both? Each has it’s own implications for sales strategy and ultimately servicing if you win the deal. Do you only want to work with customers who have a certain number of employees? Or who are or aren’t using a particular piece of software or have previous experience with it? You can always update this definition and/or hit list, and should. The more effort you put into defining who is your ideal customer upfront, the better focused your sales team will be and the less time you’ll waste of your potential customers. Why meet with a company/prospect and confuse them and/or sell them on something you have no intention of delivering or isn’t a fit if you could have known that upfront?
My last piece of advice is to track as much as you can, as you can’t improve something you don’t measure.
Figure out close rates on deals for starters. If you have multiple sales people, track performance and patterns across people. Use systems like Salesforce to organize and track stuff like this. If you have a really low deal close rate, you could either have a shitty product, a shitty sales strategy (and/or people), or you could also even be pitching the wrong clients (or all of the above). Figure out what it is. Use data to help you figure out how to adapt and evolve your sales strategy. In this process you may learn that your market is too small, or that you’re building the wrong thing, or that your definition of who an ideal customer is was too broad or too narrow, or that your sales people aren’t effectively able to sell your product. Always be learning.
As a final note, this isn’t re-inventing the wheel and hardly scratches the surface on the topic of sales strategy. There are plenty of better articles on the basics of things like aggressiveness
and the concept of sales strategy
as a whole that are extremely helpful and way more in-depth than this post. I highly suggest doing your research on the topic of sales strategy as much as anything else.