Top tips for early sales – B2B

Getting those first sales is a massive moment for startups, and whilst getting any sales is better than getting none getting it right early can set the scene for rapid growth and success.  The following list of tips are my favourites from a list of ten in a guest post on OnStartups by Chris Savage, founder and CEO of video hosting business Wistia, in the original post he goes into more detail behind each point.

  1. Don’t wait to sell – define your minimum viable product and then get out of the comfort zone of development and find people to buy it.  There is no better validation or education.
  2. Do things that don’t scale – many startups run scared of this, but getting early validation and then building processes that scale lowers risk
  3. Focus on the buyer not the user – this also requires a step out of the comfort zone of working with users who love the product but unfortunately they don’t usually write the checks, especially not if they are big ones.  As Chris says, Salesforce is a pain to set up and has a poor UI but it has great dashboards for executives and is an $18bn company.
  4. Don’t price against cost – this is my favourite on the list, in new markets pricing should be according to value to the customer.  Steve Blank writes well on how to test pricing, ask if the customer would use the product if it was free, then if they say ‘yes’ ask them if they would pay $big and work from there.  Cash is the scarcest resource for most startups and leaving money on the table means there is less to pay for customer service, new features, new sales people etc.  I was talking to a serial entrepreneur friend last night who has recently gone exec at a company where he is an angel investor, they were pricing more on cost than value and he has succeeded in increasing prices to existing customers by 6-10x.
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  • That’s a really useful summary, thanks Nic. I think that works for consumer products too. The challenge with the mass markets is to guess the pricing to reach the optimal revenues, and you can best do that by having a range of products at different prive/value products.

    I particularly like the advice about the minimum viable product. So, Nic, I have this great subscription service for parents with younger children; you look like the early adopting type… 🙂

  • 6-10x from existing customers would mean that he gets some non-fractional multiple of that from new customers. They were way under priced.

    Once you get your price in good shape, are you capturing your increasing return? Many companies that could have increasing returns don’t, because they don’t try to capture them.

  • Spend my time with young or first time entrepreneurs who often have a technical bent given they generally build the products / services they are trying to sell. They are still constantly surprised when they don’t win the deals in the face of competition that according to them are weaker product offerings. Professional sales is another skill that has to honed over time and not necessarily pulled out of a hat when needed, you can tell the teams that understand the major account process particularly at the enterprise level, they have the reference sites in place. The lack of understanding of channel management is another area that leaves start ups wondering why their partners are not selling product for them.    

  • Spend my time with young or first time entrepreneurs who often have a technical bent given they generally build the products / services they are trying to sell. They are still constantly surprised when they don’t win the deals in the face of competition that according to them are weaker product offerings. Professional sales is another skill that has to honed over time and not necessarily pulled out of a hat when needed, you can tell the teams that understand the major account process particularly at the enterprise level, they have the reference sites in place. The lack of understanding of channel management is another area that leaves start ups wondering why their partners are not selling product for them.    

  • Spot on Damon

  • Spot on Damon

  • Great Article.
    We were are also doing the same mistake of building the product and not focusing on customer.
    But then my mentor told me Just get your unfinished product in the market and validate it with your customers.
    I should have read this article early.
    I would suggest every startup entrepreneur to read this article.
    Thanks,
    Jayesh(iamjayesh.com)

  • Thanks Jayesh

  • Thanks Jayesh

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