If you haven't read any of the previous posts, start with my post about Techstars Week 1. Efficiency was the key in Techstars last week, and with that in mind, I'm going to make this post mostly in bullet points.
Mentor Madness continued last week, though everyone was starting to try and reduce the number of meetings to key personalities, and investors starting making their rounds.
Sales is Still King for Techstars Companies
This point was hammered home yet again, throughout the week. Not only does sales actually involve a lot of things - customer interviews, verbalizing and articulating your value proposition and benefits, convincing customers to buy, and actually closing - but it's the true determinant of product/market fit, investment readiness, and a host of other good things.
In essence, if you can prove some sales success, a lot of other things will become much easier. Financing, hiring...you get the gist. And more often than not, teams are still getting their heads around the fact that they are ready to increase their sales volume, and don't require more product development or hiring, or other things on their priority list. They just need to sell. It will probably take some more time before it really hits home with everyone.
Techstars companies in general are a little closer to product/market fit than a lot of startups, but the lesson is that you're probably ready to sell before you think you are.
Closing is a Skill
We had a great closing workshop (provided internally by a Techstars participant) this week that lasted all of 20 minutes. Seriously. And the end result is a clear, repeatable strategy that can be deployed by anyone who is reasonably persistent, knows your product and value proposition, and is willing to practice. The notes from that workshop:
- You want to be "solution-oriented expert" - not salesperson.
- You listen to the problems of the customer.
- Only go over features that are relevant to them - you need to be able to link features to pain points.
- They have to see the value - cost savings or benefit outweighing cost.
- Time to close: talk about pricing, ask for the close - "are you going to pay with Visa, Mastercard, American Express?".
- Next step: shut up; need to give them time to process.
- First one to talk loses (within reason).
- Be prepared for objections; prepare a list of objections and rebuttals beforehand.
- Try and address these early in the call (ex. ask early if there is anyone else you need on the call to make the decision).
- Don't offer extra rebuttals - they may have more objections.
- Know your competition so you know why you're better.
- You have to hold their hand and lead them through the process.
- Outline all steps to buying for them.
- If rejected, make sure to ask "is there anything I could have done to get your business?" - learn from the rejection.
- If they say they need to check with someone, ask "are there any problems you can foresee?" - always get as much information as possible.
- Use "second voicing" - pretend your manager is next to you when you check on discounts, other options, etc.
- Create urgency - limited time price offer, cap on number of customers, etc.
- Use social proof - show them reviews and testimonials.
- Use the feel, felt, found technique: "I understand how you feel, lots of others have felt that way, what we have found is when app is used it's easy, and we have a great support system".
- Make sure if you don't close, they have an action item for the next step.
The only thing that needs to change between sales jobs is knowing the industry and the product.
Close.io Blog (particularly Steli Efti's writing)
Predictable Revenue - Aaron Ross & Marylou Tyler
Founder Story Insight
This week was an external founder, a former Techstars alumni, who came in to share their insights. As usual, it was a brilliant story, and there was lots of great anecdotes. In keeping with the efficiency theme of this post:
- Talk to customers.
- Celebrate all the small victories.
- If you're building a company, you need to go all-in - no distractions.
- Go where your customers are to build your company.
- Mentor sessions - ask lots of questions, then be ruthless, and pick 3 or 4 to build deep relationships with.
- Raise money when you can, not when you need to.
- Raise from people who want you to succeed as a CEO.
- Team is important, but they are always second to the customer;
- Never hire people you wouldn't want at your birthday party.
- Your job will become miserable the moment you break this rule.
- Hire people smarter than yourself and who have more experience than yourself.
- Hire people who inspire you to overcome the shitty days.
- Enjoy the journey.
- A personal connection with your investor(s) is critical.
- There is a big difference between being stubborn as a founder, versus a lack of self-awareness, and this will scare off VCs if not managed.
- In choosing between customer segments: How big is the pain? How easy is it to sell? How many people are there? Do they have money?
This week also marked an interesting week in chatting about "growth hacking" techniques with both mentors and companies. For those who don't know what growth hacking is, here's a good resource to learn more. I'll be posting more about this in the coming weeks, as I do some work with companies on this topic.
Until next week!