In a conversation on pairing startups with the venture funds connected with enterprise companies, entrepreneurial sales dominates the discussion.
They’re the most important asset that startups have, said Freshwater Advisors founder David Weinstein, while Groupon SVP Julie Szudarek said an important way to supercharge a startup’s sales strategy was to tap into tactics that drive rapid adoption.
She suggested tactics that drive urgency in buying the product, such as daily deals, as well as including a social aspect to sales such as discounts for customers who refer a second buyer.
The comments were made during the program “Connecting Corporations and Startups,” the third of four in the Hyde Park Angel’s Entrepreneurial Education Series with co-working space/accelerator 1871. The first two sessions in March and June covered how entrepreneurs can tell if they’re ready to raise their first funding round, followed by an overview of early-stage investment.
The final program, on Thursday, Nov. 12, will be on “How to Work with Advisers, Board Members and Investors.” (You can find tickets to Hyde Park Angels programs here.)
Don’t understand sales? You’re not alone.
Only half of the 150 people in the audience, by show of hands, proclaimed to know what product-market fit was. (HPA Managing Director Peter Wilkins defines it as “when customers use your product and get it without a lot of your effort. Then, you put sales behind it.”)
“Pushing product into channels or hands is the best asset you have: Customer revenue,” Weinstein said when only five people in the audience indicated they were interested in the topic.
“Sales is everything,” Weinstein said
Szudarek said the first sales hires were among the most important in any young organization. They can drive the success of a product and put extra ears on the street for gaps in the product’s features. Meanwhile, sales reps must be incentivized to do what’s better for the company, because they will always “optimize to make the most money. Your incentive plan needs to be super-clear,” she said.
“They’re like water. They’ll find the crack,” Szudarek said.
(Read more on how startups can approach corporations. Read more on how corporations can consider partnerships with startups.)
Another tip from panelist Jacob Babcock, the Co-Founder and CEO of wireless charging antenna startup NuCurrent, was to bring a physical product to sales meetings (“it creates so much more validation to the customer”) and to understand all the connections to a complex sale, especially in business-to-business settings.
Corporate venture groups may be a point of contact for a B2B startup, but a business unit will actually use the product and made the up-or-down call on partnering with the startup, while the enterprise sales team must be comfortable including it in its sales calls.
“There’s a lot of different arrows that point to your sales,” Babcock said. “Ride all of them.”
– James Janega