Just open the door for me, I can close the sale

In the course of my career, I can’t remember how many times I have heard some version of this phrase from entrepreneurs. In fact, there is a thriving industry that has grown to service exactly this need: door openers that use their connections to get warm introductions to companies for a retainer and a commission. Even with that, why is it that most startups fail for lack of sales? Is it because the introductions weren’t warm enough? the entrepreneurs weren’t competent enough? the product wasn’t good enough? or something else?

In this series of blog posts I will explore some of the reasons behind this and what can be done to mitigate the risk of failure.

In my view, the failing is in the mindset which leads to a flawed approach. Having a repeatable, scalable sales and go-to-market strategy is not akin to flinging stuff on a wall and seeing what sticks. You need a plan. You also need to be nimble and reduce your burn rate. Most of all you need commitment from the executive team. The good news is that there are people that have thought through this. In fact, it would do entrepreneurs a lot of good to learn more about Steve Blank and Eric Ries.

Steve Blank (steveblank.com) has written extensively on developing a customer before you even go ahead and develop a product. There is a lot of truth to that but it may not always be easy to do.  Not to worry. In case of companies that already have an offering but are looking to penetrate new markets or grow in existing ones, it will do them a world of good to understand the needs of potential customers before doing much else. There may be an unmet need that they can exploit.  There may be channels that can be used, partners that can be leveraged. The point is that, if you elicit potential customer feedback, you will likely spend less time and money and have a greater chance of success, than if you were to enter the market and tried your “luck”.

Eric Ries (http://www.startuplessonslearned.com/) has taken the philosophy behind the “Lean Manufacturing” techniques developed at Toyota Corporation and applied them to startups. The key philosophy is to have multiple, quick, low-cost trials of the product with real customers to figure out what customers really value and throw out what they don’t. The idea being that you don’t end up spending millions of dollars and many months in developing something that the customers don’t care much about.

There is a lot to learned from these gentlemen. There is a lot also to be learned from one’s own experience and other helpful individuals’. So, dear entrepreneur, slow down a bit, assimilate information, think, and then act. It will do you a lot of good. Above all, know that entering new markets or developing new customers is hard work that requires time, thought and resources. It is not just a matter of opening doors. If anybody tells you otherwise, then I have a bridge to sell you.