By 1871 SVP of Programming George Vukotich and Steven Baumgartner, founding partner of Blossom Growth Partners and 1871 Mentor
Social media has stolen the word and the definition of “trend”. Twitter will tell you who’s tweeting at whom and Yahoo will immediately take you away from the original purpose of your visit. With all of this noise, it’s next to impossible to predict what you’ll see any given hour of the day. As this is the case, why do so many startups try to build their companies via “trending” instead of the old fashioned way of building through customer acquisition?
While VCs will hop on board for those rare brilliant ideas, the vast majority of startups are immediately told to come back once they have some momentum in the market. Some founders know that momentum means starting to pound the pavement with a strong revenue model. But for most, that means having as many “what do you think?” conversations as possible. This activity results in 50 great meetings with people who love it - but in the end, the company isn’t any closer to the momentum the VC asked for. Founders can talk to as many influencers as possible, tweet to everyone - all with the hope of becoming the next big thing that your teenager gravitates to - but with the speed of evolution in technology, the founders are hoping they “trend” before someone else who is telling the same story with different technology.
Alternatively, companies who build strong revenue processes (sell) in the early days have significantly less trouble finding investors. In many cases, the investors seek out the companies. Not only does that revenue put that company on their radar, it also gives the startup a better negotiating position as they wait for the right partner who is going to further the development of capabilities or channels.
All this is easily said but how does a cash-strapped startup without in-house sales talent build that momentum? The first step is to commit to it. Founders must look at the time they spend selling the business vs. selling the product, and most likely reverse the ratio. And saying “I’m not a sales person” is not an option. Selling begins with picking up the phone and telling your story. And remind yourself that startup sales is about two things: 1. It’s a numbers game (ten calls equal one demo) and 2. Opportunities do not manage themselves through the sales process. If someone shows interest, you have to be patient and think about filling their needs, not yours. If they want to invite four colleagues and have three more calls – great, now you have five people you can influence. Create a very simple pipeline management process that will help you ensure things don’t fall through the cracks and that you’re spending your time wisely. If someone is just “kicking the tires” and not serious about buying, don’t spend a week putting together a proposal. Move on! And if they don’t buy, ask them why so you can be better next time.
As you can imagine, there are thousands of nuances and different philosophies associated with selling, and there are tricks to properly managing opportunities through the sales cycle. But in the end, if founders can keep it simple and focused, the effort won’t be wasted. Consider making your first non-founder hire a sales person. That way, you’re calling potential customers and it’s your activities that will determine whether you’re successful. If something is wrong with the business, change it and keep selling. This is the way startups can control their destiny. If they don’t, they’re simply hoping to trend – along with that cat video your aunt just showed you.