Founders Need to Be Ruthless When Chasing Deals(steveblank.com) |
Founders Need to Be Ruthless When Chasing Deals(steveblank.com) |
With vibe coding comes vibes-based capital. I'm only half kidding.
Yes, first/fast is sometimes a negative factor (e.g. first to market doesn't mean best, second to market can take advantage of proof of market proviced by first, etc.)
Customer transaction numbers, service response times, human staffing for VIP customer service, and human engineers who are recognized domain experts. The cliche live call to customer support with some hairy-ass customer specific problem.
Plus vibe-upselling of vibe-integrations for whatever Wonderful Engineering the customer has with your profit centres.
The hard problems still remain.
Only if you're a software-only startup. If you have hardware, the entire article is still valid.
And frankly visually being able to explain how your product beats the competition is more important than writing lines of code for a product that could be DOA.
However not everyone can do this. So the scientific approach gets pushed.
It's usually initial contact + demo or feature talk of sorts. The next step is some small project with customer specific data which is billed. They get a quote and either do it or don't. Scale up, SLA etc. follow after that (basic outline of what's possible is usually given in the initial contact). Alternatively this small project can be some consulting package but it's always billed.
before I read that book and tried to sell some stuff I realized in org's there' more than 1 buyer.
in a typical b2b / gvt deal - you've 4 buyers at least.
The headline is borderline clickbaity. Specifically the word "Ruthless" made me think of something unethical like Delve's business.
He means things that actually matter to entrepreneurs. All we've been seeing lately are hype-chasing AI submissions.
I read it on mobile and, while not optimised for it, it was very easy to zoom into the middle column to read.
I wish more blogs did this: simply setting your content to 38em and doing nothing else makes the content readable on mobile.
When you've put your hand in your pocket.
I think new founders are sometimes intimidated by customers, especially well-known brands, we don't want to upset or annoy them instead of being open about not being able to afford to run loads of pre-sales technical work. We also see the dollar signs for one large customer when we should be seeing smaller dollar signs for many customers.
For the customers, to be fair, they are partly trying to derisk the purchasing decision by making sure everyone and their dog has seen the demo, shown that it definitely does exactly what they want with their data and processes etc. and they have no skin in the game at this point, so why not?
Believe in the product you have built already and as the OP says, be certain of product market fit and ABC (always be closing).
> When you've put your hand in your pocket.
I thought the same thing. From my reading of "The Mom Test", my sales strategy changed to incorporate the lies that a business would tell you to avoid hurting your feelings.
Basically, if you cannot give me a purchase order after seeing the software, you don't want it!
I do like the idea of a cancellable purchase order that they sign: organisations need an earthquake to move them sometimes. Once that thing is approved and signed by the powers that be, absolutely no one in that org is going to bother cancelling it and going with a competitor.
Yes, with an actual payment (processed credit card transaction), a signed contract with clear payment terms, or a convincing promise to pay such as a written instruction to send an invoice.
A lot of startups have made the mistake of thinking "customers" are the same as "downloads of a free app" or "people who created an online account" or "people who signed up to be notified of the actual launch."
Accelerators once encouraged this ("you have to show progress to investors on demo day!") but unless you have actual paying customers it's not a real business.
Commitment, in any form. Best is a signature on a purchase order.
The Mom Test is a good explanation of why you don't have PMF with the client until you receive a purchase order.
In short, people don't want to tell you things that hurt your feelings, especially if you're a good sales person (good sales people are likeable, you aren't closing if the client doesn't like you).
So you're sitting their with the clients team, and they like you, you made a good impression. No one wants to tell you "Look, it's not what we want, it's best you be on your way". What they'll do instead is:
1. Try to soften the blow with "We like it but we have to get sign-off from $VP first" (blame it on the non-present Big Bad Wolf); you tell them "Can we pull them in now? How about tomorrow?"
2. "Don't have the budget but we'll put it in the upcoming budget in a few months" (Hoping you won't know on their door again in 4 months); You tell them fine, we can sign now for deployment in a few months, before the rates increase you will have in a few months, and you'll throw in a discount as well.
3. "Can it do $X, $Y and $X" (Hoping you'll say "No" and then bugger off); you tell them they can make $X, $Y and $Z part of the signed purchase order.
4. "We have a lot of projects going on now, don't have capacity to manage this" (Hoping, again, you'll bugger off and forget to come back); this is one you don't respond to, you just back off because they don't need your product that badly.
If a business wants what you are selling, you will have a signed purchase order the next day. If you don't get that signed PO, you follow up over the course of maybe a month. After that you spend your limited sales resources on someone else.
Once, I spoke telephonically with an (existing) client in the morning on an upsell, and had their signed purchase order about two hours later. Fair enough, this was an existing client, but the upsell was for a completely new product.
My rule of thumb is "demo once, and record the demo". If higher ups need to see a demo before they okay, they can see the video. If the demo was not to the correct group, the correct group can see the demo (and they'll request another demo if they want one, the existing group won't ask for another demo without new participants).
Look, sales means you do more work than the client, but they still have some work to do, and if they don't do it then they're not committed.