Strong Opinions @marksbirch

Random thoughts from a NYC entrepreneur and investor about start-ups, technology and the people that make it all happen. Also find time for good tunes and good food.
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There are a LOT of resources about how to sell big, gnarly, long, difficult, enterprise deals.  Just search B2B sales or enterprise sales on Amazon to see for yourself.  But you have to read a lot of rubbish to get to the essential truths.  I just came across this post by Jason Lemkin of EchoSign fame (and a smart guy who know a thing or two about sales), that cuts through the nonsense and gets to the guts of enterprise sales.  Like he says, anyone can do enterprise sales, but it takes a massive heaping of hustle.  This is definitely a great read.

If you haven’t done corporate/enterprise sales before, the biggest thing to understand:  you can do it.  But, you’re going to have to hustle.  Really, really hustle.

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Many web-focused professionals want the customers and leads and users to come to them.  They want to focus then on the funnel, A/B testing, optimization, SEO, SEM, etc. etc.

That’s all great, and for self-service business, that’s most of it.  But for enterprise sales, you’re going to have to get your arse out of your Aeron and go close some real live human beings:

  • Listen, often in person.  That may including flying somewhere.  It may include flying a lot of places, in fact, that you don’t really want to go.
  • Learn your prospects’ business processes in detail, and how your product enhances them.  If this is boring to you, you will fail.
  • Learn how your potential customers will excel in their companies through your product.  How can you help the person buying your product’s career?  It’s not just about your fabulous UI/UX.
  • Make, or don’t make, commitments to future development and features to meet their needs.  Your product will always be deficient in some fashion in the enterprise.  Always and forever.
  • You’re going to have to learn how to not take no for an answer, how to beg for a meeting, and how to ask for money and a check.  This is really, really hard if you haven’t done this before.
  • And internally, you are going to have to manage and hire sales people.  Some will be great, some though won’t and will just take your money and will prove extremely expensive.  You’re going to have to invest A LOT of time here.  You can’t just hire some magic “VP of Sales” with 4 years of experience and have him/her scale the business.  Instead, if you do that, you’ll actually end up with less sales than before.

So if you are just starting out in a new company with a greenfield territory, where does one start prospecting?  What if you also have an unproven product with only a few reference customers, how do you get things going when you are starting out from such a small base?  Then imagine you are selling a product that does not even have a well-defined value proposition and still miles away from product-market fit?  How about when the product is more wire frames and napkin sketches than usable product?

Obviously when it comes to building out your territory, there are a wide range of situations from the mildly difficult to the seemingly impossible.  But it all entails the same deal; you are starting out from scratch.  So where do you begin and how does that vary based on the context?

One important factor to consider in sales organizations is the maturity of the company.  When I look at growth stage enterprise tech companies, I see four distinct phases of maturity:

  • Pre-product stage - generally one or two customers using a working prototype
  • Product-market fit stage - a handful of customers with an early, market verified product
  • Pre-scale stage - well-defined product and business model, more customers but still early
  • Scaling stage - significant market gains, clear understanding of cost of acquiring customers

In the later stages, the company generally has a pretty well established understanding of their value proposition and target markets.  They are busy executing to rapidly gain market share, so they create dedicated groups to help generate inbound and outbound leads to process through a highly mechanized sales machine.  They are not the companies having questions about who to sell to and how.

What I am discussing here is for the early stage companies or new groups in larger companies that are exploring new lines of business.  In both cases, the market is wide open and you are trying to find the right slice to get a hook into.  By the same token, the company has to at least have a real product and a few customers before going through the effort of targeting, so we are really talking about the product market fit stage companies or groups.

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Focus, focus, focus.  I cannot stress how important this is in the early going.  Do not fall into the trap of thinking everyone is your customer.  Let’s face it, you do not have the money, time, or resources to market and sell to “everyone”.  So narrow the focus.

Ask yourself where your product is being used today?  You would be wise to find other similar companies that are in the same industry.  Sometimes this is easy because the product is built for a specific industry like construction or fashion.  But for horizontal products this is not as easy, so look at the use cases of those early customers and determine how it would fit in other areas.

Another thing to consider is the ability to network into a particular industry or focus area.  Do you have an existing network or access to tap into those networks through your professional connections?  That can greatly help in quickly validating the product for the industry and use case.  The best way to find people to contact is to leverage LinkedIn and start mine for relevant contacts that are 1st and 2nd degrees away.  One note is that you may not want to sell head on immediately, but to ask for advice on how your solution might work for the industry and use case.

If you have the areas you are going to focus on and a network of contacts, you have a good start.  What you may find though is that the network quickly dries up after a few deals are closed.  You now need to generate leads outside of that early network, and you need to get a lot of leads.  While it is true there is ever more noise and distractions, the means to reach people has never been wider and easier.

In a post from last year, I dived into the ways of acquiring leads and various sources to collect leads.  The point is that there are numerous ways to find people.  Your job is to find the most effective and least costly options and to be flexible in experimenting different methods.  For example, you may find that industry specific events are valuable whereas paid online acquisition is not.  Or you may find that generating lists from sources like LinkedIn and setting up an outbound process is a best method.  The choice is really a matter of the value and quality the acquisition method yields.

There is plenty of details I could dive into, but I invite you to check out the NYC Enterprise Sales Meetup on Tuesday, October 21 at 6 PM.  We plan to dive into the topic of target account lists pretty deeply with a panel of long-time sales pros that are willing to share their experiences and insights.  It should be an excellent, informative, and engaging discussion with plenty of nuggets for our community to use.  I hope to see you there next week!

(reposted from LinkedIn)

I have often said it is harder to hire great enterprise sales reps than great programmers. That is not to say hiring programmers is easy. Rather, it is my way of bringing attention to the very real talent crunch for people that can understand and succeed in enterprise sales.

My career in sales was a bit of an accident. The short story is that a few months into a relocation to San Francisco, the entire sales team resigned. The head of sales flew out to tell me the good news that I was now the head of western region sales. I had no experience, no training, and no mentors. I survived and did well eventually, but not without plenty of bruises along the way.

When I joined Siebel, I met with many seasoned enterprise sales reps. Some of them learned their craft through formal and rigorous sales training programs at companies like IBM, Xerox and DEC. It was not so much training as it was a year long apprenticeship that continued through their time with those firms. It not only instilled the foundation of sales technique and culture, but it also created a strong network that often lasted across many decades and companies removed from their training.

Here we are in 2014 and much of what passes for formal sales training has gone by the wayside. Sales people are often expected to sell with just a bit of product training under their belts. Some swim, but most either drown or tread water. The result is middling to average sales results. Sure, it is easy to blame the sales staff or managers for poor performance, but more often than not, the system is set up to fail them.

The more diligent and committed of sales professionals will fend for themselves. They read the books, go to seminars, and seek out mentors. They also happen to be the star performers. Still, when one looks at the resources available for proper foundational sales training, the options are pretty poor. Most companies gave up on sales training a long time ago. Most colleges shun sales as something not worthy of study. Most seminars are focused on gimmicks rather than real sales skills. Where does one go then to learn the fundamentals of sales?

You may have seen something about a new group I shared called the NYC Enterprise Sales Meetup. The idea was borne out of the fact that many people that jump into enterprise sales often do not have an opportunity to learn the fundamentals. There is also no established community to learn from, share with, and collaborate among. That is why the meetup emphasizes both high quality, actionable content as well as networking with peers in and across industries.

While only two events in, the interest and feedback has been overwhelming. Our growing community of over 360 sales professionals has very quickly established itself as the place for enterprise sales. Sales professionals want more in depth and relatable content and they want worthwhile opportunities to build their professional network. For companies seeking sales talent, it has become a notable group for finding sales talent. For our speakers, it is a unique platform to build their profile and share their experiences with other professionals.

If you are in sales or thinking about a career in sales, and you are selling to big companies, I invite you to join our community. We meet at Work-Bench near Union Square every third Tuesday of the month to network and dig into a particular topic in sales. Our next event on Tuesday, October 21 at 6 pm is a panel discussion on “Building Your Target Account List" featuring some notable and accomplished sales leaders

I look forward to meeting you then!

It’s tempting to take the quick wins early on. But there’s nothing sweeter than winning that first true, unaffiliated deal. It took us 15 months. Yes, 15 months. The rigor and measurement they put us through made us go back to the drawing board again and again, but because of that, our technology works better, and each deal after that was easier to win.

Excellent article by the CEO of LatticeEngines about the importance of finding early customers outside of the Valley, helping to validate your product using more “real world” users (i.e. not early adopters).

http://venturebeat.com/2014/09/28/why-its-critical-to-find-early-customers-outside-of-silicon-valley/

(via micflash)

Enterprise tech is another level of difficult.  The deals are few and far between in the early days.  You struggle to find anyone willing to listen to you.  Then you have to fight through organizational morass that does not favor startups.  But each deal makes your product story clearer and your sales execution sharper until you hit that inflection point where deals start to pour in.

At some point you have to build a real business, generate real profits, sustain the company without the largess of investor’s capital, and start producing value the old fashioned way.

Burn Baby Burn via AVC

Yep, it is happening in the B2B SaaS sector as well and eventually there are no safety nets for these companies because they spent themselves out of existence.  But what is driving founders to push the pedal and spend like no tomorrow?  While Fred and Bill are not targeting valuations as the cause, in a frothy funding environment, entrepreneurs are under the belief (egged on by plenty of investors) that the money train will continue to roll on.  It is the growth at all cost theory, and well, I remember that did not play out too well the first time we did this in tech fifteen years back.

Everyone is under the impression that it is raining money.  That certainly is the case now, but nothing to bet the farm on long-term.  I know it may sound all fuddy-duddy, but turning a profit and running a cash flow positive business is a good thing.

And one thing about sales & marketing. Achieving massive scale by blowing it out on sales & marketing is certainly one way to win a market.  But you can also be much more intelligent about the process and executing with purpose and precision.  That is what is going to win, more so than playing someone else’s game when they turn on the sales & marketing spigot.

Superior sales and distribution can create monopoly, even without product differentiation. The converse is not true.

Zero to One: Notes on Startups or How to Build the Future by Peter Thiel via Tom Tunguz

This was a snippet from Tom’s blog post.  Lean Startup and the startup world often say product wins and discount the value of marketing and sales.  But in fact history has shown us that the best product does not necessarily win, it is the company with the best execution to take the market that wins.  If you want to dominate a market, create a superior sales and marketing engine.  The product will get there, but do not wait for the product to be “ready” or good enough.

No amount of process, people, or product will help if the messaging is not working

Good messaging is like good art; it is hard to define but you know it when you see it. And like art, it can be hit or miss, and more often on the miss side when it comes to early startups. Many folks attribute those startups that start getting traction and achieve scale as being startups that found product-market fit. While that is true, what got them there was the right message which is the crux of finding one’s product-market fit.

Ultimately you are creating a clear explanation as to what your company is and what problem it solves for the market. You unlock that riddle and you will find that you open a lot of doors. In that sense, your sales messaging is the master key for your particular market that works for the segments you have defined.

How does this differ from marketing messaging? It shouldn’t, at least by much. Marketing however has a much broader audience to reach out to, which includes partners, analysts, investors, competitors, industry groups, and even customers and broader market. They are the catch all and so they are coming from messaging at a brand level.

Most of what marketing creates should still align with what sales does, but sales are focused on one audience only; prospects. So the messaging needs to be crisp, clean, and jargon free. The point is that anything that creates questions or concerns or roadblocks in the minds of prospects should be removed, and that includes messaging that could likely confuse potential customers.

Messaging is such an important topic that I made the next NYC Enterprise Sales Meetup all about that one thing. It will be a panel of sales and marketing experts in the B2B enterprise market talking about and sharing their thoughts and tips for crafting great messaging. If you are struggling with or have questions about how to craft messaging or what you even say to prospects to get their attention, then this meetup at Work-Bench on Tuesday, September 23 6 PM is for you.

Before I close out this post though, I thought I would jot down a few thoughts of my own since I am going through the same challenges now with my startup. Here are some things to consider:

  • Who are you trying to reach? Messaging is not some monolithic, one-size-fits all thing. You need to understand who you are reaching out to buying creating buyer personas and then targeting your messaging to fit that persona. If you neglect to personalize your message, you risk alienating the every audience you are reaching out to.
  • Is the messaging crisp? Like a good elevator pitch, the messaging needs to be easy to say, easy to understand, and short. Drag on and on, it makes your company and product look unfocused. Note that this does not mean you should adopt the “we are X for Y) format many startups utilize which sounds pithy and undermines your unique value.
  • Is marketing and sales aligned on messaging? Often these groups are working at cross-purposes, which causes marketing and sales efforts to appear disjointed. This creates questions in the mind of prospects as to what you offer, creating unnecessary friction in the sales cycle. It is critical that sales and marketing are working together as one united front.
  • Is the message too ambiguous? The best messaging strikes to the heart of what a company does and is offering. If the messaging is too broad or too “inside the studio” then you are forcing people to dig. In an age when attention spans are getting shorter, expecting people to dig for more is a bad assumption.
  • Is your messaging too complex? In the attempt to appear novel and cutting edge, sometimes we fall victim to being too smart for our own goods. The result is messaging that confuses prospects. The effect compounds at every stage of the sale, lengthening the time it takes to explain and educate prospects. Do not try to be fancy! Stick with plain language and remove the jargon which creates barriers.
  • Is the message unique and defensible? The opposite problem of complex messaging is reducing it to something so basic that it does not sound all the unique. For example, simply calling yourself a recruiting platform or a CRM tool may be simple, but it does not get across why your offering might be better than other options in the market.
  • Is it the very best messaging? You may think you have come upon the winning ticket, but you might be missing out on an even better message. Never be afraid of testing new messaging and trying new ideas to stay fresh. To that end, always be testing across your various outreach channels to see what is most effective. That also means you need to incorporate a metrics driven approach.
  • Is your messaging too static? Markets, customers, and products are constantly evolving at faster cycles, so the messaging should also evolve. Messaging need to needs to be relevant and timely, so make sure that you are reviewing the messaging on a regular basis.
  • What are customers and prospects saying? We often forget to take notice of how our customers describe the company and the products, or what transpires in conversations with prospects. Make sure to capture that information from the field and see if it aligns to your core messaging. Chances are the way they are explaining things might be more relevant to your target audience.
Life’s real failure is when you do not realize how close you were to success when you gave up.
Thomas Edison
Never allow a person to tell you no who doesn’t have the power to say yes.

Eleanor Roosevelt (via kennyherman)

Too many sales deals die a premature death due to gatekeepers, tire kickers, and others that have little power in the organization.  Do not let them get in your way and find the right people, those that have the power to make the deal happen.

NYC Enterprise Sales Meetup

The first event for the newly launched NYC Enterprise Sales Meetup went way better than expected!  Free events are tricky to gauge when it comes to RSVP’s, but that evening over 75 sales folks attended and out of 90 sign ups.  The first panel topic “Your First Five Customers”  garnered some great discussion by our five panelists and moderated by Jake Dunlap of Skaled.  It was great to hear each panelist candidly share their experiences in finding and driving home those first enterprise deals for their early startups.

We have to sincerely thank our panelists for being so generous with their time and insights:

We also have to thank our sponsors, Work-Bench, who provided the space and Enhatch, who sponsored the food and snacks.

Come join us for the next event in September on ‘Creating “Sales Effective” Sales Messaging’.  It will  be a panel discussion talking about how one takes a marketing message and transforms it into something that gets buyers interested.