Practical, experienced-based, execution focused tips for Tech Startups to establish new customer pipeline, prospection processes, CRM Systems, sales training to identify target customers, generate qualified leads and deliver sales
Winning first customer is tough! We review here practical insights, methods and tools for Startups to execute Business Development for Robotic, Software Analytics or Industrial Automation solutions.
This session provides hands-on guidance on how to execute an efficient outbound business development process to capitalize on growing Automation markets.
“Social-distancing directives, (…) could prompt more industries to accelerate their use of automation. And long-simmering worries about job losses or a broad unease about having machines control vital aspects of daily life could dissipate as society sees the benefits of restructuring workplaces in ways that minimize close human contact..”
New York Times, April 2020
For Business Development in Industrial Automation, we tackle:
How should I organize and prioritize my customer outreach?
How to tune your message to OEM Manufacturers, System integrators and End users?`
Is it best to go wide and shallow or focused and deep?
Can I adapt my outreach depending on product complexity and sales cycle?
How do I get in touch with the right decision maker?
What does it really mean to qualify a lead?
We talk with Luca Rabezzana, Business Development Associate at Sparksense. He draws from his real-life experience working with start-ups and shares his passion for Machine vision, robotics and markets.
We discuss tried and tested, street-smart approach to Boost customer acquisition for your B2B Tech Startup.
Check-out also our detailed posts on Commercial Growth:
Drop in Venture Capital forces Tech Startups to more market focus
How Tech Startups push new customer acquisition? After years of record global Venture financing and flurry of Startup events, a new chapter is opening. Free from distractions, this chapter will be written by market focused Startups. By successful Entrepreneurs focused on Customers, delivering solutions to address real life problems. They will tell stories of Impact, focus, frugality and execution.
“The lack of market is by far the number one reason for Startup failure. Tech Startups need to rely on a mix of Tech skills, market focus and sales methods to identify truly qualified customers for their technology. This is a marathon, not a sprint.”, says Hervé Flutto, Tech Entrepreneur and Founder of Sparksense.co.
It is critical for Tech Entrepreneurs to shape their Business Development and sales organisation over time. Best practices are emerging to guide Startups towards market focused strategies.
Business Development for Startups is very different
For Big Companies, Good business development is something that is tangential to their core mission. This can then become part of it, serves as good marketing or as another money maker.
For Startups, Business Development is not just about winning new customers. It is a vital function to access specific market intelligence on innovative product offering. This intelligence feeds into improved product features, pricing model, extended services, channels, team profiles etc…
Organize your sales today for growth tomorrow
So what does this really mean for Tech Startups to push new customer acquisition? Sven Koehler, Co-founder & CEO with Anerdgy AG, Zürich, launches its new IoT solution with Sparksense flexible Business-Development-as-a-Service. More than ever he sees “Many startups and young companies start to look into financing and find out that their business needs to get more commercial traction. First steps for us are to identify the right customer for our new product- this is a key priority.”
Over time, a B2B Tech Startup combines 5 key roles in its sales organization:
The CEO as a Salesman – often the best option during the Prototype-to-Product phase. Founder(s) are immersed into both market reality and product development.
Business Development – after initial product-market fit, specific resources are allocated to win new customers, launch Demo pilots and expand recurring customer base.
Key Account Management – as business economics allow, a dedicated Team is established to manage and expand relationships with existing customers.
Channel Partner Manager – to scale-up revenues quickly, and globally, many successful Entrepreneurs set-up indirect sale networks.
Customer success team – tasked to ensure customers get the most value from the solution; particularly important role for novel solutions and source of future product insights.
For Gianluca Cesari, Co-founder & Business Development Manager, Sparksense extended Business Development team works well for Sevensense AG, Zürich. “To do Business Development in our field, you need to have a clear grasp of technical concepts to convince customers. In addition, in a Startup we are often out of resources. Calling on customers, investigating which solution could be a good fit to for them is very time consuming.”
Also, Entrepreneurs should realize that “people who excel at selling new products have traits and behaviors different from those of people who successfully sell existing product lines”.
Some things for Tech startups to consider when staffing for Business Development:
Attitude beats Experience – beyond relevant Tech knowledge, look for communication, great listening skills and resilience
Flexible set-up – team size and profile should adjust to match promising applications and evolving market opportunities; potentially blending internal and external resources
Minimize cash burn – keep fixed cost low to protect your runway while building revenues
Process first, tools second – an excel tracker is great to start prospection; just be prepared to introduce more advanced (free) software to secure team coordination
Sparksense’s collaboration with numerous tech startups has resulted in the emergence of best practices:
Start with a clear goal – You might be looking for initial Proof-of-Concepts, new recurring customers or international expansion. In any case Qualified leads should meet 3 criteria: (1) right decision maker; (2) interested in your solution; (3) available budget.
Stay Focused – Beyond the Innovation Labs, concentrate on Operational business owners; they are more difficult to access but they are also closest to recurring business for your Startup.
Fulfill your promise – Balance new customer growth with Engineering and product management execution. Achieve true Qualification of Leads to reduce hand-over issues to scarce product engineering resources.
Whichever path you pursue for your Tech Startups to push new customer acquisition, the CEO should remain closely involved in Sales, as your Startup launches new products, explores new markets or manages large customers. Prepare to flex your Sales efforts in line with your liquidity and revenue goals. Manage a close link between sales and Product development teams. And be resilient …
Check-out also our detailed posts on Commercial Growth:
Winning first customer is tough! We review here practical insights, methods and tools to execute Business Development for Tech Startups.
You are launching a unique tech solution and looking to access the most attractive markets? It is not “sales”! Many tech startups struggle to identify, attract, train and retain qualified Business Developers. In addition, a “sales” approach can backfire if you are starting to sell while a client is still in “education” mode.
“If the economy continues to head south, what does it mean for entrepreneurs ready to scale their business? Should they hold off on growing sales? Should they take a more conservative approach? My answer is no. In my view, a down economy is the best time to build a sales team.”
Mark Roberge leading Sales at HubSpot during the 2008 crisis.
The success of a Business Development for Tech Start is directly linked to two aspects of outbound Sales:
First, the Team skillset and attitude.
Selling novel, unique solutions is not business as usual. Salespeople need both product knowledge and market knowledge—an understanding of market trends and customer buying patterns. They bring a strong understanding of the technology, combined with great listening skills. They are also resilient, acknowledging that this is a marathon, not a sprint.
Second, the good tools and methods.
A great team strives for executing a robust business development process, which is very selective and focused to capitalize and protect your unique value proposition. You want to foster efficiency from the initial market segmentation, target focus, initial outreach all the way to the lead qualification. This also requires discipline to delete less promising prospects.
We provide practical insights on how to build and manage a team with the right attitude. It also provides hands-on guidance on how to execute an efficient business development process. It includes answers to questions like:
How should I organize and prioritize my customer outreach?
Is it best to go wide and shallow or focused and deep?
Can I adapt my outreach depending on product complexity and sales cycle?
How do I get in touch with the right decision maker?
What does it really mean to qualify a lead?
We talk with Lugas Raka Adrianto, Business Development Associate at Sparksense. He draws from his real-life experience working with start-ups and share his passion for sustainable technology to provide exciting insights, practical examples and answer live questions.
This podcast is an opportunity to discuss tried and tested, street-smart approach to Boost customer acquisition for your B2B Tech Startup.
Check-out also our detailed posts on Commercial Growth:
How leading Tech Startups protect their Technology effectively, managing Intellectual Property, Trade Secrets, Copyrights and Patents.
While the launch of a tech startup is exciting, each entrepreneur needs to establish a strong legal foundation to protect itself and its intellectual property (IP). Indeed, Intellectual Property (patents, designs, trademarks, copyrights, trade secrets) is a key driver in a Company’s commercial success.
Indeed the value of a start-up is usually directly linked to two aspects of intellectual property:
First, the protection of own intellectual property.
Startups are initially not in the position to challenge the top dogs. This is due to their financial power, reputation, market penetration and relationships to other players in the market. Therefore, to make a great idea into an economic success, the idea needs effective legal protection.
Second, the protection against third party’s intellectual property.
Intellectual property rights create monopolies. The owners of intellectual property rights use them to fend off competition. As a result Third party’s intellectual property can be a show-stopper. In effect, Startups have limited funds to use in legal matters and navigate through this complexity. Therefore, Startups need a strategy in place to avoid such pitfalls very early on.
This Tech Talk addresses how leading Tech Startups protect their Technology effectively, managing Intellectual Property, Trade Secrets, Copyrights and Patents we also address questions like:
Which type of intellectual property is best suited for my business?
Is it better to patent or to maintain secrecy?
How do I manage Process vs. Product IP?
Which third party intellectual property rights are relevant for my business?
How can I reach reasonable certainty with regards to third party’s intellectual property rights?
target=”_blank”>Herve Flutto
We talk with Daniel Hoppe, Certified IP Specialist Lawyer with the German based IP law firm PREU BOHLIG & PARTNER. He draws from his experience in advising start-ups in matters of intellectual property and from his experience in intellectual property litigation.
Check-out also our detailed posts on Commercial Growth and prototyping:
Content marketing drives 10x increase in lead conversion
This Content Marketing Guide brings together specific actions and use cases most from our day-to-day work with Tech Entrepreneurs. It draws also from our own experience building Tech ventures in Energy and Aerospace industries.
If you have more money than brains, you should focus on Outbound Marketing. If you have more brains than money, you should focus on Inbound Marketing.
Guy Kawasaki
We believe that a well-executed Content Marketing strategy is key to success for early tech ventures – in this Content Marketing guide for Entrepreneurs we cover:
Why Content Marketing is important
What content works for your startup
5 Ground rules to shape your content
Great Use Cases on content distribution
Powerful, Easy to use and cheap Tools
Call To Action to get qualified leads
Why Tech Entrepreneurs should focus on Content marketing
Outbound Marketing & Sales feels great!
You dig through your network e.g. Linkedin & co. to get some target names. You reach out to them, email or chat, for a chance to sell your solution. Probably a necessary step, but this has some flaws:
You spend most of your time establishing first contacts
You are interrupting your audience in their day-to-day business
Missing problems where your solution could be of greater value
Very low sales conversion rate and huge time spent
In this Content Marketing Guide for Entrepreneurs, we prefer to focus on the definition :
“The marketing and business process for creating and distributing valuable and compelling content to attract, acquire and engage a clearly defined and understood target audience — with the objective of driving profitable customer action.”
Build the right Content Marketing for your startup
In order to maximize impact of any marketing action, it is critical to understand the characters at play.
THE HUNTER a.k.a Entrepreneur
The Tech Entrepreneur should consider key characteristics of one’s early stage Startups, as it affect the Content marketing strategy:
Mostly unknownto your target market
Still validating and discovering real market needs
Time-to-revenues and acquiring new customers is key
Cannot afford fully fledged digital marketing campaigns
THE TARGET a.k.a Prospective Customer
Be careful! Your Target is NOT the Innovation Manager, who is scouting for Innovative ideas.
Every decision maker you’re trying to engage with spends 90% of their working life in F.E.A.R. They are: Frustrated, Evasive, Apathetic and Risk averse.
Our Target character is one of the Business Managers busy tackling day-to-day operations. He has probably lived many years with the Status Quo. When the Target decides to solve a problem, one wants tangible benefits: increased sales, reduced cost or improved quality.
5 practical rules for effective Content marketing
So now it is time for Tech Entrepreneurs to take this content marketing guide into action!
#1 Make your content relevant to your Target audience
Know-Your-Customer with empathy. Focus on understanding your Target market needs, problem and expectations. Work out various options to address this issue incl. your solution. But keep it low-key on branding and hard selling.
#2 Build credibility and trust
Working in F.E.A.R., the Decision Maker is concerned by the risk of working with you as a new supplier. Testimonialsand facts from Pilot, existing customers, research partners or opinion leaders increase your credibility.
#3 Illustrate your content
You should grab attention through relevant picture or visual. License-free pictures and video material can be found on Pexels, Unsplash, Pxhere and many more on a pay-for-license e.g. shutterstock & co.
#4 Your Call To Action
Prepare your Call To Action well before your content marketing release. Keep in mind that your goal is to generate awareness so that your target audience connects with you. You need to have a clear path to bring these new leads into your commercial funnel.
#5 Measure impact and iterate
We are competing for attention with a million other content. While the costs of ‘Distribution’ have dropped to almost Zero, the ‘Production’ time & costs have increased to deliver quality content. Regularly measure impact to fine tune type of content, messages and distribution channels.
Now that you have built your content, let us look at ways it can be distributed to your audience, leveraging specific use cases.
THE DISTRIBUTION – where to publish my ‘content’?
It should be where your Target audience is looking for information. Do you address a large, fragmented market? Or rather a an industry with few big buyers? How much time and money you are prepared to dedicate?
Below are some of the main distribution strategies implemented for tech Startups.
Social Media For most Tech businesses, preferred routes will be Linkedin, Medium, Youtube and Industry specific blogs. If your business involves design or visual value creation, consider adding Instagram or Facebook.
Labtoo, France, European marketplace for scientific research. Leveraging LinkedIn & more
Blog Startups should favor theme based content, which grabs attention. Add some News as you become a more established businesses. Keep it generic, typically loosely tied to your company and branding. Many blogs follow the ‘Listicle’ format and some more Best Practices here.
Hubspot, USA Marketing, sales, and service software that helps your business grow without compromise. Great blog!
Podcast Simple audio recording, easy to edit, convenient to consume, inexpensive and quick to produce. 17% of marketers plan to add podcasting to their marketing efforts in the next 12 months. For a step-by-step guide, how to Start a Podcast check this here.
Flyability, Switzerland, provider of solutions for the inspection and exploration of indoor, inaccessible, and confined spaces. Great Podcast series & more.
Meetup & Network events In 2018, Atomico reports about 15’000 Tech related meetups in each Paris and Berlin, 30’000 in London alone. Meetups can be a very powerful and cheap way to connect with your audience. It allows you to explain your solution and build a community around your brand.
LuckaBox, Switzerland a last mile platform for logistics, recently launched its own Meetup
Live or online Training seminar Workshop format built around your solution. You might consider also providing some online training as lead generation to your main business. Based on the right content, it can be scalable and promotes you as expert in a field. Consider Udemy, Teachable and more.
Flokk by Iart, Switzerland, an open platform for implementing interactive light installations without coding. Here Hands-on workshop at Architecture Biennalle, Beijing 2018
Video Video is a must have nowadays; combined with landing pages can increase conversion by 86%. Vary your format from short social media teaser, to company overview to ‘How-to-Video’. A nice infographic by Hubspot and more B2B Video examples here.
Product Configurator An online product Configurator is great to automate your product features selection. Gartner estimates in 2018, 40% of B2B digital commerce sites to use Configure, Price, Quote (CPQ) tools. Your challenge is adoption. Start small using Google Form or a Web Editor before expanding functionalities.
Up2Parts, Germany, Revolution in Digital Manufacturing. Advanced Online Configurator
Open Source & Freemium models Providing a free(mium) Open Source solution can drive great business traction. It is powerful to ‘Try-before-your-buy’, build a community of users as an asset or generate a larger hardware installed base.
Klepsydra Technologies, Switzerland software for faster embedded computing performance, releasing an Open Source version
Industry Trade show As a startup, forget your expensive own booth. Instead, join the booth of a large established player. Apply for Call For Paper to be on stage, alongside a well-known partner if possible! Take on comfortable shoes to walk the floor and meet prospect customers.
Neural Concept, Switzerland, 3D Deep Learning Software for Enhanced Engineering @ Nvidia Booth Supercomputing 2018
There are many great (free) design tools to help you be efficient. But do not get distracted – the ‘Design’ part of the content is the easy bit.
The hard part is to work, re-work and fine tune your content. It is old fashion but it forces you to think through key items : audience, wording, problem, solution, features, benefits… Forget the font, color & co for now…
Knowing that you could work on the detailed ‘content’ forever, now you feel good about it. Ready to tackle the ‘design’ !
Below is a list of tools we use every day… powerful & easy to use
Canva great for quick & professional looking design
Gimp open source graphics editor for image retouching and editing
WordPress simple web editor for professional outcome
Anchor.fm to create, host and broadcast your podcast
But of course the content is only a means to an end… so let’s get into action.
CALL TO ACTION – turning your Content into Sales
After the Acquisition comes the Activation phase. Whatever your established goals are, it is critical to ensure you have a Call To Action.
If your business relies on a large community of users, consider having a sign-up landing page. Strategic landing pages are used by 68% of B2B businesses to acquire leads.
But of course, most Tech solutions need to build a personal rapport with your prospective clients. Be prepared to share details about your solution in online call, live or recorded demo and a personal sales meeting.
Tech Content Marketing is a wide topic! This content marketing guide for Tech Entrepreneurs is to trigger thoughts and actions. Since we all can benefit from everyone insights, we invite you to comment and share your experience.
We enjoy working with diverse Entrepreneurs and Ventures, also on supporting them on their path to Market Launch. This guide for Startup validate product features… quickly and cheaply.
Before moving too quickly towards Product & solution development, we recommend each Entrepreneur to focus:
“Make sure
you are building the rightit,
before you build it right!”
They are a lot of excitement around Minimum Viable Product (MVP), Product-Market-Fit, Proof-of-Concept (PoC) and other Prototypes. This is also linked to the tremendous success of The Lean Startup movement.
We find the use of “Pretotype” a great way to focus on what matters – the customer and market adoption. A true guide for each Startup to validate product features.
” Pretotypes make it possible to collect valuable usage and market data to make a go/no-go decision on a new idea at a fraction of the cost of prototypes: hours or days instead of weeks or months, and pennies instead of dollars.” states Alberto Savoia, Author of The Right it!
“Most new ideas fail in the market—even if competently executed. We call this the Law of Market Failure.”
There is only one way to fight the Law of Market Failure: test the market for your ideas objectively, rigorously, and quickly before you invest to develop them.
Pretotyping provides you with the tools and techniques you need to validate your idea with minimal resources and in a very short time (as little as a few hours.)
Download and read along in this short, practical and useful guide called Pretotype It
Check-out also our detailed posts on Commercial Growth:
We do not pretend to have the magical recipe for Innovation. However, our daily work with both large companies and startups gives us a unique perspective on closing the Gap for putting “Innovation” in practice.
Companies “hear about the advantage of disruptive innovation or step-out innovation and decide that their organization should do “some of that.” But their organizations are designed to do something else very well. Namely, what they are already doing.” – Why Big Companies Can’t Innovate, Harvard Business Review
From large companies, we hear how difficult it is to “Innovate” in specific industries; worst, many Managers believe they are laggards while other companies are faster, more flexible and prone to innovate! There is so much noise around “Innovation” that many Manager are in constant “catch-up” mode or FOMO (Fear Of Missing Out)
At the same time, from B2B Tech startups, and the frustration of “Innovation Labs” disconnected from the priorities of the Company’s core business. Several months into meetings, negotiating proposals and running Proof-of-concepts, the initial excitement for the “innovative” solution is often buried under business lack of focus, day-to-day priorities, one-off pilots and red tape.
On a rush to “Innovate”, many Managers and Entrepreneurs alike forget the 3 levels of maturity for adoption of Innovation:
Technology maturity or what everyone is talking about today
Market maturity or the ability for a viable roll-out at scale
User maturity, rarely talked through but often most critical
In this paper, we will uncover together 3 challenges on a path to Redesign Innovation Labs for growth. We will also articulate 5 specific actions companies can execute to achieve sustainable Business Growth.
Challenge #1 – it’s Innovation Magic!
Remember how you watched the latest Magic show? Like a kid, you probably experienced a mix of Delight, Wonder and Superiority!
Delight – we are wired to be in awe of things that cannot be logically explained.
Wonder – we know these things are fantasy, but if magic is real, then maybe all kinds of other cool things that we want to believe are real, too.
Superiority – while there are some people who watch magic with wonder, there are plenty of others who get off on their perceived superiority to the magician. They can figure it out. .
Today, Innovation is like watching a magic show! Delighted by the Technical novelty, we join the crowds of Innovation Summits & Tourism, Startup festivals and Pitching competitions. We know many of these things are fantasy but also wonder how it could work for our company. The first thing we burn to ask the Magician is “how did you do this”?
Challenge #2 – The “Innovation-as-a-service” Trap
Under
pressure from shareholders, customers and competition, each business needs to
“Innovate”. As so often, Managers focus on the easiest part of the equation –
the How. We send people to training to acquire and learn the method and tools.
We establish Innovation Labs, “Silicon Valley Outpost”, Accelerator, Incubators and often even hire a Chief Innovation Officer! And then we outsource the essence of Innovation to external providers or “innovation-as-a-service” consulting firms, with the promise that you too can innovate … efficiently!
From this, the “Innovation Manager” feels free to share deep insights travelling the world, giving keynotes about Innovation at the ever growing audience of Innovation Forums.
Challenge #3 – The “Halo Effect”
Our business world is full of research and analysis that are comforting to managers: that success can be yours by following a „Innovation“ formula, that specific actions will lead to predictable outcomes.Innovation is one good example of “The Halo Effect” where the perception of one quality is contaminated by a more readily available quality. In this case, Innovative companies being rated as more performing when promoting Technology innovation.
What the authors claim to be the causes of long-term performance are more accurately understood as attributions made about companies that had been selected precisely for their long-term performance… In fact, lasting success is largely a delusion, a statistical anomaly… – The Halo effect, Phil Rosenzweig
So what we should do instead?
Build on your business and management strength to Redesign Innovation Labs for growth. Stop focusing on Technology Push “Innovation” and instead address the key hurdles on the way to sell a new product or solution into the market – User Adoption. And be ready to transform your company in a challenging but rewarding process!
Focus on customer (re) discovery
Established companies have a deep market experience, established channels and long standing customer relationships. From there, Managers are best positioned to identify user’s problems, both internal and external.
B2B Tech startups engage in Proof-of-Concept with prospective customers to offset their lack of “track record”. For larger companies, this PoC can also be a fantastic opportunity to (re)discover their customers, adjust features, increase value capture – and secure user adoption along the way.
Be ready to Test-and-Learn
Most companies have established a functional, geography or product-driven organization or a mix of all. Many also have or thinking of establishing a Chief Digital / Innovation Officer.
One particularly useful organization is along the Customer Journey including a Customer Success team or some people committed to a great product value experience. These customer-centered teams are key in ensuring customer maximize value from new products. More importantly, embedded in the New Product development teams, they can provide invaluable insights to for new user-driven product innovation while increasing value capture! Check out our post on Sales organization.
Organize to Execute
Once the customer insights are flowing into your organization, the true business growth will come from implementing the new product or solution features. This phase will rely on a higher tolerance for Risk and the proper frugal mindset or Jugaad.
Methods such as Agile process to execute and iterate evolving product features over time can be helpful. This is done sometimes under a separate organization with required “Air Cover” to protect from interferences while also giving marketing freedom with eventually a distinct Brand.
Not-Your-Sales-as-usual
New products require also new sales processes, capabilities and metrics. First you will need to invest more qualified sales people time for Inbound vs. outbound sales and Solution vs. Product selling. The focus is on establishing a long-term relationship and on ensuring your customer is deriving sustained value from the solution. e.g. Partnerships and network effects.
When we work with a Startup, we define what are Key Performance Indicators and identify Solution-selling talent. While the solution might be new, the KPIs are generally well established in the given market but might be quite different from the established Company core business!
Business and Talent acquisitions
For many large companies, hiring the required talent, particularly round “hot new tech” such as AI, Cloud computing, Software Development is a real challenge.
We rave at the GAFA & Co. and their incredible ability to innovate and grow. We should not forget that most AI solutions the GAFA are now deploying to the market are arising from many Product & Talent-driven acquisitions over the past 5 years.
Used properly, Innovation marketing and “Acquihire” can be powerful tools to evolve the way your company culture, customers, employees and new hires image.
To bring it together, some takeaways:
Whatever you do to Redesign Innovation Labs for growth, Mind the Gap between Innovation and Adoption!
Focus on user-driven innovation to deliver true business performance & Growth
Listen and partner with your customers to increase your value capture
Review your organization design to ensure customer success and feedback
Implement Reverse Mentoring to upskill your organisation and evolve Culture
Set clear goals for your innovation initiative… you get what you measure
Challenge “Innovation-as-a-Service” solutions against your Business goals
Validate first startup Commercial value-add, not equity transaction
Foster experimentation Mindset to address new customer unmet needs
Consider creating a separate Brand & organization for execution
Looking forward to your comments, questions and feedback !
From Startup to Scaleup? After numerous pivots, sleepless nights and uncertainty, you’ve survived the chaos and crushing ambiguity of start-up life and managed to develop a unique tech idea or already patented an offering for customer. You are bootstraping your venture through project consulting while further developing your new product before scaling up. But the same strategy that got you through the initial start-up stage, is not working anymore. Still wondering why?
Tech companies face different challenges when it comes to scaling up and coping with risks at various stages.
From Startup to Scaleup strategies
Recode in 2016 provided the following definition which we think are to the point:
A startup is on the quest to find product-market fit, developing and iterating its product or service, experimenting with customer segmentation and working toward a positive contribution margin.
A scaleup, on the other hand, has already validated its product in a market, and has proven that the unit economics are sustainable.
When a Venture is exiting the startup phase, it generally needs to choose:
In-house Scale up – Develop and test the product in-house. Upon successful development and validation, set up production unit and selling through own channels.
Outsourcing a function of the business – Letting an external partner handle the function, for eg. Marketing or HR or production, to get expertise in the field.
Licensing – Licensing a well-developed technology to another company / person and charging a royalty fees on the Net profits or revenue-share-agreement obtained through implementation.
Key factors guiding your scaleup strategy
So to go from Startup to Scaleup, you must consider a broad range of factors and balance what is desirable with what is feasible. Following are some of the factors to consider:
Barriers to entry – in some industries, regulation, certification, scale of production, brand reputation or distribution can be formidable barriers to a new Product entrant; in such case a Licensing strategy could be preferred
Time-to-Market – Depending on the stage of startup, competition and strength of IP, licensing can be a fast track route to get your product in the market faster.
Integration risk – while you might have validated a first lab prototype, some residual technology risk might remain from the integration of your solution into existing products; a high integration risk threshold would favour a licensing strategy to OEM
Team capabilities – Available expertise and experience of your team will confirm the capabilities to produce inhouse or with partners; this allows you to focus on your core strengths, avoid the challenge to develop expertise across the board.
Access to capital and Return on Investment – Licensing requires much less investment and time as compared to in-house development. The access to adequate capital is often a key driver in strategy decision.
Location and cluster – your geographical ease of access to specialised capabilities, processes, talent and know-how can play a decisive role in your scaleup
How to implement your scaleup strategy
Once you have chosen a strategy based on above factors, below are some key steps to consider on your path from Startup to Scaleup.
Research the environment and current situation – Assessment of external environment is critical to know your market, know the bigger picture and the challenges you might face.
Build a plan based on the idea and selected strategy – Assess you core competencies, adopt your business plan in line with the selected strategy and capabilities of your team, set KPI’s and a clear roadmap for the future.
Outsource what is non-strategic to optimize leverage – find the right partners, for non- essential activities and focus on leveraging on key capabilities. Scaling up is not only about leveraging internal capabilities but also outside resources.
Strengthen your team to support core capability – Recruit more people to strengthen special know-how and broaden the Management skillset of the team.
Leverage your network to build collaborations – Network plays a key role in building the trust with the partners for your idea. Leverage your existing network to find the right partner with required competencies to scale up your idea.
Monitor and Evaluate the results – regularly review KPI’s to evaluate the success of your strategy and take corrective actions as necessary
A plan, no matter how strategic, is only a plan. The success of scaling up depends on actual implementation but also the ability to react to changing market conditions.
Check-out also our detailed posts on Commercial Growth:
October is upon us and with the end of the year approaching quickly, as a startup founder now is the time to kick your goals! Summer may be over but that doesn’t mean the good vibes are; in the next few months some of the largest Tech conferences for Startups will take place including SaaStock in Dublin, Unleash in Amsterdam, Web Summit in Lisbon, Slush in Helsinki, MWC in Barcelona; the list is endless!
With tickets and exhibition spots usually sold at steep prices, you’ll probably think twice – and read our other post first – as a startup founder before forking out the money of your scrappy startup budget to attend one of these events. And if you do, odds are you’ll lose focus in the sea of people, presentations and activities. So how can you use these conferences to turbocharge your startup journey and how do you prepare to make the most of them?
Connect at Tech Conferences
With a mixed audience consisting of startups, investors, blue chip companies, tech pioneers and media outlets these large conferences have got you covered, no matter where you are in your startup journey. Looking to learn about best startup practices and figure out how to get your idea off the ground? Head over to the exhibition area and learn from the hottest startups on the planet and how they turned their idea into a reality.
Are you an established startup looking to pilot or partner with leading brands and get feedback on your product? With many blue-chip companies attending these events in search of the latest trends and technologies this is the place to make your move. And once you’ve sealed the deal, don’t forget to get the word out! With an abundance of journalists, bloggers and media seeking for their next startup hero story, large tech conferences are the place to share your story with the world.
Oh, and in case you want to connect with investors to secure your next round of funding; big names like Sequoia, High Tech Gründer Fond (Germany), BPI France, SOS Ventures, Accel Partners and Andreessen Horowitz are returning visitors at several of these events and always on the lookout for the next unicorn, just sayin’.
Our advice? Create a list and reach out to people and companies that could be gamechangers for your business BEFORE the conference, and schedule your meetings to take place during the event. These events are huge, so you’ll want to avoid time wasting and having to find the right people whilst the conference is in full swing. Also, make sure you have yourGaddie pitch practised and ready to go; it’s by far one of the most effective ways to get people interested in your idea.
Needless to say; come with an open mind and bring your business cards (for the cool cats a fully charged phone will do) to make the most of random interactions and capture amazing tools and technologies that are relevant to your startup.
Learn
And last but not least, Tech conferences for Startups are the ultimate spot to learn anything about tech (duh!) and innovation. A quick glance over the programming of a few of these events teaches us that this year’s events and speaker line-ups are bigger and better than ever.
Are you looking to disrupt the HR industry and shape the Future of Work with your tech solution? Head over to Unleash to hear from experts in HR, including Margareth Greenleaf from Roche, Carolanne Minashi from UBS and Dominik Hahn from Allianz. Want to learn more about sales and connecting to your customers? Hear from David Gerhardt, VP Marketing of Drift or Martin Afshari-Mehr, Director of Salesforce at SaaStock, a conference focused on SaaS businesses. Operating in the travel business?
Join Web Summit to hear from Gilian Tans, CEO of Booking.com, on how artificial intelligence and machine learning is improving their service and transforming the industry. Looking to learn from the best in venture capital?
At Slush, you can learn from Arlan Hamilton, a remarkable entrepreneur who built a venture capital fund from the ground up, while homeless. Or maybe you would like to hear Cyan Banister, Partner at Founders Fund, who’ll speak at Web Summit. She has made dozens of angel investments over the years, including in Space X, Uber, Niantic, and DeepMind Technologies, which was acquired by Google for more than $500 million. And whilst you’re at it, don’t miss the opportunity to hear from some more unconventional speakers, including one of the greatest soccer players of all time, Ronaldinho, and Buddhist Monk, Author and Humanitarian Matthieu Ricard.
Again, make sure to plan ahead to learn from brilliant minds in your industry but also don’t forget to check out speakers working in completely different fields; they might just share some unexpected gems of wisdom that change your perspective and outlook.
All in all, plenty of reasons to check out our startup events overview , do your research and take your pick… You never know where it might take your startup rocketship!
Check-out also our detailed posts on Commercial Growth:
As a young Entrepreneur, you know that getting out of the office is key to building a relevant network. You know that a the right events for Startups can propel your business where it can thrive and achieve its business goals more efficiently. However, we are always amazed at how much time Entrepreneurs waste attending the wrong events. Are you also tired of not getting what you expect from events?
Why attend an Event in the first place?
Motivation and goals to participate in an event can be diverse but mostly fall into one or several of these categories.
Scouting for new ideas, market intelligence and competition
Reputation marketing to build credibility as opinion leader & employer in your field
Raising funds for your venture and increasing your visibility to Investors
Accelerate Customer acquisition and connect with relevant decision makers
Influence key policies and decisions within your industry
Have fun, combining team building with business related discovery
As with any business decision, in a resources constraint environment, it is foremost important to ensure you have clear goals regarding event participation.
What types of events can you attend?
Of course there are many different types of events available to startups depending on time, resources and costs of participation.
Incubator: 6-12-18-month program often with co-working spaces
You can check some selected upcoming events for startups here.
Some things to watch-out when picking Events
Whether with customers, investors or partners, it is great to try out some various events formats. However, below are some pitfalls you should be aware of to select the right events for Startups.
Being in the spotlight: as Founder, you put yourself in front of your business; you use the venture as a vehicle for you to get visibility and positive reinforcement; this syndrome is likely to appear in pure-play startup events, remote from market challenges
Comfort zone: some Entrepreneurs tend to select those events where they know they have an edge; remember that for a deep tech start-up, pitching and winning at tech events might feel great but does not solve key business questions
The Booth: getting a booth at an event can be a curse for a startup; A booth is great for established companies to gather partners or customers efficiently. Generally understaffed, startups are better off walking the floor and talking to people
If it is Free… you are the Product: many events are popping up financed mainly through corporate sponsors; they are scouting for innovation & ideas but not always with a clear purchasing mandate
Vision vs. Market: as you engage on the growth path for your business, you will encounter many challenges along the way. As you do this, be prepared to call “bullshit” on pitch focusing only on “vision”, “paradigm shift”, “disruption”. As your talks shift away from talking about markets, customer and sales so are your chances of building a sustainable business.
Selling vs. Discovering: as you start facing commercial challenges, watch out for being stuck in “discovery” event mode; early on you should shape your ideas and technology into a product + pricing proposal you can bring to potential customers
Escaping reality: as the business challenges increase, attending Events can become a place of comfort away from the tough reality of the business
Making the most out of your event
Selection: take a bit more time to challenge the need to join specific events; look for qualitative assessments and peer recommendation to meet your objectives
Priorities: stay focused on key business questions you are trying to answer? Key challenges? Resist the temptation of going to events just because it is free or you “won” a pitching slot! (Remember: if it is free…)
Liquidity: most likely you are better off not renting a booth and walking the show; as needed, booking a demo room nearby a larger event can be a great alternative to renting out expensive space on event premises
Time: you might leverage the event platform to connect with speakers or participants but decide not to attend in person; this might prove a great compromise to not participating to the event at all
Impact: prepare extensively before attending time-intensive events and particularly when you have a targeted audience in mind e.g. Investors or customers; review their specific strategy, focus and priorities so you can be razor sharp in your message
Value: a thorough and timely post-event follow-up is critical to getting real value from an event and send a clear execution-focused signal
Focus: Events should only be a means to an end; make sure you do a candid post-event lessons learned to inform your business decisions and challenge further event participation.
To execute the right events for Startups, given the lack of transparency, information and reviews, identifying and leveraging the most out of the right events can be a challenge for most Entrepreneurs. The need for exposure to peers, customer, partners or investors should force a sound judgment on to the few events, which a Startup must attend.
To simplify this task for you, sparksense.co provides you with a platform for start-up events here. We would appreciate your suggestions and feedback !
