Innovation and User experience are two areas where CIOs are willing to look at new things: Highlights of #InTech50 2014: Day 2

This post covers the highlights of day 2 of InTech50 2014.  The highlights of day 1 are here.

Before getting into the highlights of the pitches of the 50 companies, here are some important points from the expert talks and panel discussions.

View from the VCs:

Rob Heiman, Alok Goyal, Sandeep Singhal and Tim Goddard gave practical tips to the entrepreneurs.  Some highlights:IMG_3032

Quality of the team trumps everything else. Everything else – product, technology etc. are not as important as the team. In a startup journey, the product will change, technologies will change and pivots will happen. Hence the quality of the team is paramount to make corrections along the course.

The team has to be focused on one thing and believe in what they are doing.

VCs get tons of unsolicited mail. While they try not to miss any of them – it is better to go through a warm introduction through some common person. Otherwise, getting together will be difficult.

View from the CIOs

Chris Hjelm, Dawn Page, Jay Jayaraman, Damn Frost discussed their view of startups and what startups should consider when engaging with large enterprises.

  • Startups need to understand the business needs of the enterprises.
  • The startup’s product should solve their business problem.
  • Be relevant to their needs. For example, Mobile Security is a big pain point – and they will be very willing to anyone who has a good solution for them.
  • Don’t talk jargon to CIOs – cloud, unstructured data etc. do not excite them. That is not relevant to them. Talk to them on how you can solve their problems.
  • CIOs get tons of emails – identifying a good startup is like finding a needle in a haystack. Word of mouth is a very good medium as CIOs are very well connected with each other.
  • Be realistic about what you can and cannot do.  If a small startup promises to solve world hunger, credibility will be at risk and it can adversely affect the next steps.
  • Do your research on the CIO’s company, their technology choices and current technology investments. Most of the time, this information is freely available. Try to experience the business the CIO’s company is in and then explain to them how your solution fits into their scenario.
  • CIO’s are also looking at the business model of the startups to see if they are going to be long term players.
  • Innovation and User experience are two areas where CIOs are willing to look at new things.
  • One of the big challenges for large companies to work with small companies is scale. Usually, smaller companies do not have the resources to handle requests from a large company.
  • A good and respectable CIO has a lot of say in the company. So it is good to go through the CIO. At the same time, the business group should be excited about your solution so they can back the CIO’s decision.
  • For large companies – data is their most valuable asset. Non-essential data can be put on cloud, but the essential data has to remain on premise e.g. customer data, financial data, as that is very sensitive information.


Rapid Fire Pitches

The 50 InTech companies chosen to present in the rapid-fire pitch were selected out of the 200 applications.  Each jury member independently scored all the applicants, and the top 50 were chosen.

The InTech50 companies are of different sizes and operate in varied domains. While some of them are leaders in their space and mentioned in Gartner’s magic quadrants, some are pre-funded startups with just a handful of customers.

Most of the companies have a global customer base.  Some of the companies have customers from more than 100 countries.

The 50 companies were categorized broadly into:

  • Experience and Engagement Management
  • HR – Recruitment, Survey, Talent Management
  • BI/Analytics/Social Analytics
  • E-Commerce
  • IT Security
  • IT Services Development

IMG_3063Each company got exactly five minutes to present their product in a rapid fire pitch. Thanks to the excellent planning and execution by Manjunath Gowda of I7 Networks, it was all smoothly executed and on-schedule.

You can learn more about these 50 companies in the InTech50 Booklet.


Five awards were given at the end of the day under the following categories.

  • Most Scalable Idea – Zipdial
  • Most Original Idea – Uniken
  • Best Value Proposition – Linguanext
  • Best Pitch – Unmetric
  • Most Popular Company – Sapience/TouchMagix


Benefits to InTech50 Companies

In addition to the great learning from the expert talks and panel discussions, several companies got very good feedback from the CIOs on their product and many got good leads to pursue.   Overall, all the participants found InTech50 very valuable and were extremely grateful to iSPIRT for providing this platform.

Vasanth Kumar, Co-founder and COO of Sheild Square, said that  they got two “proof of concept” (POC) engagements at the conference.

Manjunath Gowda, CEO of I7 Networks also got two POCs and quite a few leads.

Satya Padmanabham from Zapstitch said he got to learn a lot from other companies as well about the different business models and it was a great exposure overall.

Varun Sharma from iViz security said they got good response from CIOs as well as other InTech50 award winning companies.   And it was a great platform to network.

Next InTech 50 is on April 15th and 16th 2015 at Bangalore.  Mark your calendars and be there!

India is poised for success because of the 3 D’s: Highlights of #InTech50 2014: Day 1

InTech50 is a joint initiative by iSPIRT and Terrene Global Leadership Network.  InTech50 is a showcase of some of the most promising software products created by entrepreneurs from India.  This is the 1st InTech50 and is going to be an yearly event.


The inaugural edition of InTech50 saw great participation: 50 Top Indian product companies showcased their products to 25 Global CIOs, 25 CIOs from top Indian companies, 25 top investors, angels and accelerators from US and India and several visionaries and media across India and US.

Piyush Singh and Sharad Sharma co-chaired InTech50 2014 and put together an excellent program for 2-days.  Day 1 was all about content-rich talks and panel discussions from visionaries and experts to inspire and guide the product companies. Day 2 was dedicated to the 50 InTech50 companies to pitch their products and was also interspersed with highly relevant talks and panel discussions.  This post covers Day 1, Day 2 is covered here.

Opening Session

Sharad Sharma shared some very interesting statistics in his welcome address:

  • 40% of Indian startups are in Bangalore
  • 40% of Asian statrups are in India
  • By next year, India will be the 2nd largest hub by number of startups.
  • 82% of Indian startups focus on a global market.

Read more statistics in the InTech50’s booklet.

Sharad mentioned that there are three broad areas where he sees growth in the Indian Software Product companies.

1. Software Infrastructure: This includes things such as security, BYOD, cloud, app management.

2. Decision Infrastructure: Analytics, Big Data

3. Innovative Applications.

One of the initiatives of iSPIRT is to educate small Indian businesses about SAAS potential and products. Today, this knowledge is lacking and these businesses are not informed buyers. So far, 60,000 small businesses have been trained by iSPIRT on SAAS.

Another iSPIRT initiative is working with the corporate development teams in large enterprises to foster M&A of startups.

Welcome Address

Dr. Srivatsa Krishna (IAS, Secretary for IT, BT and S&T, Government of Karnataka) enthralled the audience with his presentation on “Why India Rocks”.

Dr. Srivatsa shared interesting facts that to establish his premise of Why India Rocks.

  • Indian IT Industry contributes to 8% of GDP and 25% of exports.
  • 80 of 117 CMM Level 5 companies are Indian.
  • IT revenues grew from USD 100 million revenue in 1992 to USD 100 billion in 2013.
  • 100 Indian companies have more than $1 billion market cap.
  • 150 of Fortune 500 companies have R&D centers in India.
  • 400+ of Fortune 500 companies outsource work to India.
  • Literacy in India has crossed 80%
  • By 2020, there will be 20 lakh IT professionals in Bangalore.
  • Along with IT, Gaming and Movies is also growing big time in India. Labs in Bangalore created substantial portions of movies such as Skyfall and Life of Pi.
  • A huge Media City is being planned in Bangalore where most of the post-production work of movies is envisioned to happen. The Media City will do to the digital movie and entertainment industry what Electronic City did to the Indian IT Services Industry.
  • What started as labor arbitrage in the initial days of IT industry has now grown up in the value chain. Mu-Sigma is an example of a world-class product company from Bangalore that has now more than 4000 employees and is the 2nd largest big data analytics company in the world.

Bangalore is already the IT capital of the world. The next step is to make it the Innovation and Startup capital of the world.

Dr. Srivatsa mentioned that the government is being a catalyst and enabler. Along with the big cities, Tier 2 and Tier 3 cities such as Mysore are also being developed.

One of the initiatives is to offer land for free if the company creates jobs. For every 1000 jobs created, the Govt. of Karnataka will give 1 acre of land free on a long-term lease.  There are also exemptions from outdated labor laws and special tax breaks are available to encourage the Software industry.

On the flip side, he also mentioned that there are challenges such as being ranked 132nd in the world to do business, long time taken in courts to enforce contracts etc. The good news is that that government is working harder and faster towards making it better.

Opening Keynote

Kiran Karnik, Member, National Innovation Council, Government of India, visionary ex-President of NASSCOM, and the prestigious Padmashree award winner, delivered the keynote.IMG_3011

Mr. Karnik said that Innovation and Software Products are the two main areas that will drive growth for India.

According to him, India is poised for success because of the 3 D’s:

1. Democracy: Though there are some bottlenecks with respect to government speed and enforcements, it is trying its best to promote the industry and is improving day by day.

2. Diversity: Most of the innovations happen when there is good diversity – e.g. bay area and east coast of USA.  India also has a varied diversity and the cross-pollination fosters creativity.

3. Demographics: The largest chunk of the population of India is young and this human capital is a great asset.

India has the unique combination of cheaper, better and quicker.  Some other countries have one or two of these attributes, but India has the unique advantage of possessing all three attributes. The Indian work ethic is now famous in the world.  While this is giving an edge to India currently, our future depends on how we innovate and differentiate.

The Indian IT Services industry has done tremendous service to the country and has created a very good foundation of talent and branding. The product companies should now leverage this and take us to the next orbit. The future of India is in Software Products.

DNA of product companies is different from services companies. Not just in India, but world over, due to the different goals and business models. It is difficult for service companies to become product companies.  Startups are ones that will make disruptive products. Startups should target global markets, but they should also leverage the local markets for validation, testing and getting the product right.

Highlights And Takeaways from other sessions

Product successes are happening from India and we will see many more in the coming years.

During the early stages, startups must incentivize early adopters by giving them special deals such as co-development, deeply discounted prices, royalties etc.  From the early days on, it is best to build the product along with a live customer.

Companies should keep an eye for serendipitous events and leverage them.

Shoaib Ahmed of Tally said that they resisted the urge to take to services. They remained focused on being a product company. According to Shoaib, the key reasons for Tally’s success are the mantras of “Customer First”, “Partner Growth” and “Building a Reputation”.  They also leveraged inflection points in their industry – for example, when VAT was introduced in India.



Product Design and User Experience

Karthik Sundaram, from Purple Patch, shared his insights on product design and user experience, emphasizing that products should pay close attention to the 4Cs of great design:

1. Clarity.

2. Context (of the user).

3. Confidence (make the useful feel confident to use the tool easily)

4. Cheer (make it an enjoyable experience.

The current trends are predictive design, self-service design and ubiquitous design (across all devices).

The mindset should change from ‘What can the product do?” to “What can it do for the customer?”.  If focus is lost from the customers’ needs, the product will become irrelevant. For example, Netflix and Amazon were disruptive to Blockbuster and Barnes and Noble because they made it that much easier for the customer.

Rishi Krishnan, from IIM Indore, gave his insights on how to make product innovation work.  According to Rishi, if the following three attributes are satisfied, the chances of success increase by a large amount.

1. Painpoint. It has to solve a real painpoint for the customer.

2. Wave. The currently talked about area, which is doing the buzz.

3. Waste. Areas where there is lot of wastage are prime candidates for companies to optimize.

One example he gave was of Vigyan labs in Mysore. Vignan labs are working on controlling power consumption in data centers.  They are satisfying all the above three attributes and hence he sees a very good future according to him.

Rishikesha gave another example where he contrasted Ace Commercial Vehicle (4 wheeler for last mile transport of goods) and Nano car, both products from Tata Motors. Ace has been a tremendous success, while Nano is not. And the primary reason is that customers drove the requirements for Ace, and customers were involved at each stage from conception to delivery. Market input is key. Product managers should know how people use their product and in what context. Concepts such as lean startup are very relevant for startups.  You need to do rapid experiments to validate your assumptions. Experiment with business models too, not just technology. For example, Google does around 20,000 experiments every year – only 500 of them go live.

Mukund Mohan, from Microsoft Ventures, educated the audience about the cultural differences between Indians and Westerners using vey effective role plays. For example, how Indians expect the product to speak for itself, and focus more on the product features rather than customer needs. One of the key takeaways is to understand the customer in their context, understand their pain points and establish a personal connection.  First ensure that the counterpart is interested in doing business with you – that is the first step before looking into the merits of your offering.


Rob discussed several technical terms and valuation methodologies, making the audience realize that it is a non-trivial and complex subject. The key takeaway is that the VC financing terms are more important than pricing. Make sure you consult a professional and understand the financing terms before you sign up with investors.

Try to create a competitive process for the VCs. Having multiple VCs interested leads to a bidding process and gets the best deal for the entrepreneur.

Investment is a relationship game.  Find a VC with whom you can gel well. This is going to be a long-term relationship and it is very important that you like each other. This is the most important consideration and the not the amount of money being invested or the amount of dilution.  If possible, find an investor who has got reserves for follow-on investments. This will be useful if you need more money as the investors also want to protect their prior investments in you and will be more open to invest if they can.

Another key takeaway is to not raise money when you are desperate. Better to raise money before you get to that state. And maintain your momentum during the fund raising process to show continuous results. Find VCs whose strategy and success fits your business. Understand what is important to your prospective investors.

Manjunath Gowda sold S7 Software for US $8.5 million in 2010. S7 Software was in the space of Software Migration and built tools and provided Software Migration services. While pitching to BlueCoat – a US based company, BlueCoat expressed interest in acquiring S7 Software to become their India R&D center. The valuation was very tricky and Manjunath was recommended different models by different gurus – such as discounted cash flow analysis, multiple of annual revenue etc. Manjunath quickly realized that these models were not relevant in his situtation. Manjunath found out the real reason why BlueCoat was interested and what BlueCoat would have gained from the acquisition – in this case the engineering talent of S7 Software. Once that was clear, the valuation focused on benefit to BlueCoat and not on the standard textbook models.  To paraphrase Manju – ‘Similar to how beauty is in the eyes of beholder, valuation is in the eyes of the buyer”.

Kumar Rangarajan from Little Eye Labs, the current rock star of the Indian Software Product ecosystem (first Indian acquisition by Facebook), gave an inspiring speech about their entrepreneurial journey and how they were focused on their vision and were flexible to adapt and planned for acquisition as their exit strategy.

Please continue reading the highlights of day 2 here.



101 Takeaways from the First ProductNation Boot Camp #PNCamp

The inaugural edition of PNBootcamp at Pune is the best thing to come out from iSPIRT yet – in my opinion.  For all the startups that missed this bootcamp, I strongly recommend staying tuned to for the next playbooks and bootcamps.


There were two themes in the bootcamp:

  1. ‘Discovery Hacking’ for those companies who have not yet figured out the product-market fit.
  2. ‘Scale Hacking’ for those companies who have figured out the product-market fit and are now looking to build a repeatable and scalable business model.

The participants were divided into cohorts of 15 and these cohorts took part in day long highly interactive discussions facilitated by practitioner entrepreneurs who have ‘been there, done that’.  It was very heartwarming to see the ‘pay it forward’ maxim of iSPIRT in full steam.  Successful entrepreneurs disseminated their hard-earned learning from their journeys with the intent to improve the product ecosystem in India and ‘let a thousand flowers bloom’.  Do visit the PNBootcamp website to look at the illustrious list of facilitators and volunteers.



While trying to figure out how to condense the 50 pages of my notes from the bootcamp into a blog post, I felt that I could do most justice by writing down the top 101 takeaways.  Here goes:


Discovery Hacking:

  1. The most common mistake that startups commit is to build something nobody wants.  This is also the largest risk.  The most important question to ask is – will my offering remove customers’ pain point? One must first confirm ‘the need-gap’ priority.  Use tools such as surveymonkey, competitive analysis and customer interviews to see if the need is there and also if it is important enough that people will want to pay for a solution.  People might say that this is a great product, but they may not want to pay for it.
  2. Definition of a customer:  “The person who writes the cheque”.  Even if you have users, but no one wants to pay for your offering, then you don’t have customers.  The customer is the person who pays you, and can be different from the person who uses your product.
  3. Do not confuse validation of the problem with validation of your solution. Use the Minimum Viable Product (MVP) to validate that your solution is indeed solving the problem for the customer. ‘Build, and they will come’ is not a sound philosophy.  It rarely works.
  4. If not even a single prospect is jumping out of their seats for your solution, then the product-market fit is poor.  It gets a lot harder after that.
  5. Startup journeys are typically 4-6 years.  You need to be in it for the long haul.  Startup journey is very hard. There are times when it can be frustrating for days or months at a stretch. Consider the opportunity cost and your level of seriousness before starting up.
  6. There are several distractions at each point during the startup journey.  Maintain your focus on two important things – Sell and Code. If you are not selling or coding, be 200% sure how that activity is going to help your startup.
  7. Building a business is bloody difficult. Learn from your peers and other people’s mistakes.
  8. Focus on prototyping instead of pitching. Focus on delighting your customers.
  9. Sell. Sell. Sell. Sell first even before building the product.  ‘Sales’ is serious business. It is the most important aspect of building a business.
  10. Investors are not always right.  They just have their point of view based on their experiences, just like everyone else. Build the business. Investors will follow.
  11. It is a myth that Sales involves lying and misrepresenting facts.  The best sales guys are truthful.
  12. It is a myth that one needs a business degree to do good business.  Some of the best sales people are techies.
  13. It is a myth that techies can’t sell. In the earlier days of the product, when it is not well known, it is the founder’s passion and vision that helps selling.
  14. Hiring a sales guy early on is a mistake.  Sales people should come later in the cycle when the business model is validated and you need to start scaling.
  15. You are in the driver’s seat. Never take eyes off the road, ever. Keep laser focus on your business. Avoid distractions like media and news about other companies.  There is no room for distractions in a startup.
  16. Startups are founded typically due to emotional reasons, which makes it all the more important to have a disciplined approach.  Also, friends and family encourage and we start off with a lot of personal biases.  As far as possible, decisions should be driven by metrics, score cards and analytics.  Create the discipline to value cold hard data over opinions.
  17. You have to be very scientific in your approach.  You need to have a good understanding of answers to the following questions:
    1. What is the problem you are solving? What is the validation?
    2. Who is your customer? What is your niche? Initially, you must target as narrow as possible and then expand to other target segments after you achieve success there. Become the king of a small hill first and then expand.
    3. How do you sell? What is your cost of sale? If your cost of sale is more than the Life Time Value (LTV) of the customer, then it is not going to be a profitable business.
    4. What is the size of opportunity?  This is basically to get a sense of how much your business can potentially grow to. This question is important for your own personal goals and also if you wish to approach investors.  If the size of opportunity is too small, it may not be worthwhile for you to try to build the business.
    5. Who is your competition and what are the current substitutes? This is important to see if people are going to use your product.  Remember that if you are automating something, one of the substitutes is doing it manually.
  18. Lean Startup Methodology works.  Every startup founder must be familiar with these concepts.  Great books on this topic are ‘The Lean Startup’ by Eric Ries and ‘The Startup Owner’s manual’ by Steve Blank and Bob Dorf.
  19. Use experiments instead of opinions.  Most of what we start with are “Assumptions” and “Opinions” and not “facts”.  No idea survives first impact with the actual customer.
  20. The only way to validate our opinions and assumptions is through clear metric driven experiments. Convert the assumptions into ‘verifiable statements’ i.e. numerical hypotheses.  For example, if show the paper sketch of my product to 10 potential customers, 2 of them will agree to give me a conditional advance order.  Then run this experiment and measure the response.  Based on the response, you must use your judgment to either persevere or pivot.  Design tiny experiments which can be run in the least amount of time.11268731253_d58684b4da_o
  21. Do experiments with an open mind.  Design the experiment to validate your assumption rather than just reinforce your bias.  Savor any surprise findings from your experiments as that new knowledge will help you make better judgments.
  22. Do all your experiments with your Minimal Viable Product (MVP).  You can add scalability, security and other aspects after you have got a paying customer.  A general rule of thumb is that it should not take more than 3-5 months to validate your assumptions.
  23. There are different kinds of MVPs with varying fidelities that will help validating your assumptions.
    1. Customer interviews and surveys. Low fidelity.  This might help in validating the problem, but it does not validate your solution.
    2. Landing page on your website + traffic driven using Google adwords. Also low fidelity, but helps in validating the problem and that people are looking for solutions.
    3. Concept videos.  Similar fidelity to landing page.
    4. Paper sketch.  A little more fidelity as now prospects can see how you are planning to solve the problem.
    5. Digital wireframes. More fidelity as they can visualize how your solution might be and whether it is of value to them.
    6. Concierge MVP or Fake-O-Backend.  High fidelity. This is where you manually process the customer requirements without putting any code or systems in place.  But the customer is able to use your service to solve his problem.
    7. Working prototype.  High fidelity.  Immediate feedback on whether your solution solves their problem.
    8. The product itself.  Highest fidelity.  Typically, MVPs should not have this level of fidelity.
  24. The cost of change (a.k.a pivot) increases exponentially as the product goes through idea, prototype and launch stages.  Also, the emotional commitment increases at each stage which makes it much more difficult to make those changes.  So try to make any changes as early as possible.
  25. Do not make large investments without validating your assumptions.  Among your assumptions, pick the ‘leap-of-faith’ assumption which is most important and validate it first.  If the ‘leap-of-faith’ assumption fails, everything else fails.
  26. If you are in the business of ‘marketplace’, you need to validate your assumptions from both the suppliers and the consumers.  Validate the supplier side assumptions first as they are the ones who will be making money in the marketplace.  If you cannot validate supply side assumptions, there is no need to validate consumer side assumptions.
  27. First do the value experiments to figure out if there is a real need your product is solving.  Once you have figured out that you are building something that some is willing to pay for, then run pricing experiments to figure out the right price for your product.  Pricing experiments can also be done using A/B testing.  For different sets of users, try different price points to figure out what price you want to finally decide. Simplicity is generally a very good thing, particularly in pricing models.
  28. Ideally, get an advance purchase order or a letter of intent (LOI) before writing any code.  This also validates that you have found a buyer.  Sometimes, we might a ‘user’, but that person may not have the buying authority.  In those cases, you might be building something that is difficult to sell.  It is better to sort out ‘who is the buyer’ assumption as early as possible.
  29. For startups, it might be sometimes difficult to get an advance purchase order.  In those cases, validate the buyer assumption by seeking non-monetary commitment from the customer. For example, if a pilot needs to be done, the customer might be able to offer you accommodation and food in their guest house and also commit the time of some of his employees.
  30. Focus on one BIG problem at a time. For example, do not try to solve a BIG technical problem and a BIG sales problem at the same time.  Focus on doing a few things well, instead of doing a lot of things.11268730054_1041491b59_o
  31. Make it very painless for the user to give you feedback.  This is the most valuable thing during ‘Discovery’ stage. Use this feedback and iterate.
  32. Always have a way for the customer to get a free trial.  There is no substitute to the user actually using the product to validate your assumptions.  And reduce the friction to trial as much as you can.  Make it as easy as possible and don’t make the user think or read.  Case studies, videos etc. help. But they will not buy till they experience the product.
  33. If your offering is a service (as opposed to a standalone product), do not give it for free.  If people do not want to pay for a service, it means the need is not important enough.
  34. Till such time that you have found the product-market fit and have got paying customers, do not hire a sales person. Hiring sales people is a scale problem, not a discovery problem.
  35. It is usually good if your product idea comes to you because you are facing the problem yourself. This accelerates the validation of your assumptions and reduces the risk of making mistakes.
  36. Customers will buy the product if it solves their problem, not because you are good at selling. The product should be able to sell despite a poor sales experience.
  37. Getting the target customer right is very important.  Avlesh Singh of WebEngage initially felt that engineers were his customers as it would automate work for them and keep the marketing guys at bay.  But he realized that engineers were not buyers.   They didn’t have the budgets or business reasons or the willingness to buy their product.  However, the marketing folks were really interested in their product at it solved their business need.  They also had the budget and they could see return on investment.  It would also make them less dependent on their internal engineering teams. Pivoting the customer segment from ‘Developers’ to ‘Marketers’ was a major turning point in WebEngage’s journey.
  38. Pricing model should be based on customer’s perceived value, not on some technical aspect.  For example, instead of charging for number of HTTP requests, it might be better to charge based on number of surveys completed.
  39. Derive your price based on market dynamics (current manual cost or pricing of competition) and not on your incurred costs.   Build some differentiation in your offering and use that for price arbitrage.
  40. For techie founders, one thing that needs particular attention is that techies are highly opinionated and look at things in black and white.   We need to get over our strong views. One way to achieve this is by meeting and talking to different kinds of people and getting their perspectives.11268700366_a652a671ca_o
  41. By writing good content on your blog site, you can attract customers and establish thought leadership.   If a person spends 8 to 10 minutes on your web-site, it is very likely that he will sign up for your free trial.
  42. Quora is a very good forum to attract customers.  Provide genuine answers without shamelessly promoting your product.  People hate it and you can also get blocked on Quora for directly promoting your product. One tip is to include your product name in your Quora user name – that way when people see your name, they see the name of your product too.
  43. What works for some other company might not work for you in your context.  There are several factors at play and it is difficult to figure out. The only way is to run various experiments and see what works.
  44. Think in terms of how the end user is going to use your product.  The human element is very important.  You must know your user well – really really well. Know the context in which the user is going to use the product – the user’s demographic, life style, social life, aspirations, work life schedule, how they work, and their aspirations. Create personas of the users.  There are free templates available online to create target personas.
  45. Feedback from users should shape the product.  It is common to see several bug fixes or new features between version to version. But rarely do we focus on customer delight as the focus of a release.  Customer delight should get more priority than new features.
  46. You must observe how the user uses the product to get a deeper understanding. If you ask customers pointed questions, they will give pointed answers and hence it is not very valuable.  Engineering, business development, product mgmt and UI teams should all experience first-hand how the user uses the product.
    1. Never ask customer what they need – instead observe what they do.
    2. Never ask for their feedback – instead watch them use it.
    3. Never just listen to what they say – instead observe their behaviour.
  47. There are free tools for capturing the user behaviour. They help you record the user experience through a web cam when they are using the product. Search for them online and evaluate for yourself.
  48. Sign up folks from your target segment. Call 5 folks on a Saturday and observe their behaviour with the product.
  49. Be frugal and save money. Do not splurge during initial days.
  50. Startup people have to be hands-on. Should be ready to roll up the sleeves and do all kinds of work.11268807103_4aa0e9f56f_o
  51. You have to persevere. You will hear a hundred “No”s before your first “Yes”.  Tip: People seldom refuse a cup of coffee.  Ask for that small coffee meeting. If the customer sees value in your offering, he will give you more time.
  52. Hiring good people is good. If they are good hearted, better.  Focus on getting a team that can run as fast as or faster than you.
  53. Luck is more important than competence.  Competence is a must, but you need luck also to be successful. There are several factors which are not in your control but can have a major impact on the outcome of your company.  However, you must run like the devil is behind you and not just wait for lady luck.  When a lucky event happens, you must analyze it to figure out why the lucky event happened.
  54. Sales, product management and engineering are three important pillars of a startup.  Ensure you have specific individuals who are tasked with each responsibility.  The same person can play multiple roles, but you must be clear on who is playing which role.
  55. You must qualify the companies/individuals who will be suitable for your product. Not everyone is going to be your customer.

Scale Hacking:

  1. Scale hacking is all about aligning and finding the business model after getting the product-market fit. The key to scale hacking is to find out what is working and do more of it.
  2. Initial sales happen because of the founder’s passion. Sales people need a template for selling.
  3. If you have a lousy product, nobody can sell it.  The product should be great and the positioning should be right. Folks should be willing to buy it in spite of the sales experience.
  4. There is no template for scaling.  You need to explore different avenues and channels. Some of them will work for you and some of them won’t. Even when some are working, you should be exploring new channels as you might be missing out a very good revenue source.
  5. You need aim to be in the top 3 players in your market if you desire to scale. You first have to be a player on par with competition.11565850805_891d74a239_b
  6. You might have to change your sales pitch multiple number of times based on reaction from the market.
  7. When the customer can visualize the benefits of your product, it makes a huge difference.  E.g. if you say that the user can jog after taking your medicine – it can be visualized by the customer and have a bigger impact than just saying it will make you healthy. Visuals are very important (good graphics). Do not expect the customers to extrapolate mentally.
  8. You have to show customers the solution to their problem. For example, freshdesk creates a site called and puts their logo there so the customer can see how the solution will look like. Also, they show role based dashboards based on who they are giving the demo to.  Different people like to see different things and you need to customize your demo to how it will help them.
  9. Marketplaces are something you should definitely consider for scale hacking. E.g. Google app store.
  10. Integrations are the new SAAS channel. E.g. integrate with salesforce, basecamp etc. Then write a blog on how the integration works. Write to the business person at the Salesforce side and ask them also to promote your integration.  Typically, they are also interested in promoting something that promotes their product.
  11. Positioning is very important in the mind of the customer.  For example, though Freshdesk does several things – the core positioning is that it is a customer support solution.  For example, they provide invoicing, chat, time sheet also, but they do not position them as separate products – it is all under the umbrella of customer support.
  12. Unassisted buying (e.g. purchase directly from the website) can get you only small tickets. If commitment is higher, customers need to talk to a live person and you need to invest in field sales.
  13. Importing from competition is a 1.0 feature.  Do not postpone it thinking it is not your core work. From customer’s point of view, it is very important to have his current data migrated over to your product.  Otherwise, they may not even bother to try your product. Make it very easy for your customers to come over to your solution.
  14. Customer’s attention span is very small. He might sign up for your product, but forget about it.  For example, a customer might provide his email id and sign up, but might not even bother to go to his Inbox to click on the verify link.  Hence, engaging leads is very important and focus your energies on getting them to trial your product.
  15. Nobody likes to talk to a sales guy. Have a title like ‘account manager’ etc. and this person says that he is trying to help out with the evaluation.11268639314_bf2074fbe3_o
  16. Webinars are very effective for scale hacking.  Offer a free webinar on a related topic and soft sell.  There has to be enough meat in the webinar content itself which will be attractive and worthwhile for the attendee.  In webinars, people do not want to hear your pitch. They want to see thought leadership and practical advice for them. If you can, have customers speak at your webinars.  This is better than someone from your company speaking. For example, the title of a webinar can be ‘CMO of company X speaks on how to maximize ROI on Y’.
  17. Once you start scaling, you must have support staff available in the time zone of the customer. This is very important due to global competition.  In India, companies have different shifts of support personnel working from India but during the business hours of the customer’s time zone.
  18. Pricing is a challenge.   You should look at the current cost for the customer, price charged by competition and come up with your own pricing.  If it is too high, it scares customers away and if it is too low, you end up leaving money on the table.  But this problem is unsolvable.  You can only do price experiments to figure out the price of your product in the market.
  19. ShopSocially moved to small monthly subscription + cost per social action. This way they have a very low entry cost for the customer and as the customer uses more of their product, they will pay more.
  20. Try to get a marquee customer in your portfolio.  It will have a huge impact on your credibility and growth.  Suddenly, prospective customers will look at you in a very positive way. So you need to be flexible on pricing during the initial days.  Give discounts in exchange for case studies and testimonials. Or give discounts over larger timeframes. E.g. 3 months free if they purchase a 1 year license.
  21. Evaluating a sales person is tricky, unlike an engineer where the results can be directly attributed to the efforts.  Tip: Shadow your new sales hire for 3 months to judge for yourself if is good for your business.  If there is a mismatch, let go of the sales guy as early as possible. Otherwise, the cost to your business is huge.
  22. Always collect data on how people are using your product, which features they are using and which they are not. This should be one of the main ingredients for product direction decisions. If the product manager is sitting in a cube, then it is not good. He should be talking face to face with customers and getting real world feedback.
  23. When you are trying to move customers away from a competitor who they have already purchased, you need to protect the customer’s investment so far.  E.g. when a customer had 6 month license still left with your competition, you should offer 6 months free on your product to protect their investment.  However, see if you can have the customer pay for the first month and then the next 6 months given free.  This ensures that they are serious about switching to your product and have made a commitment to you.
  24. If you are in a commodity market where there are hundreds of competitors, then execution is the key differentiating factor. Of course, it goes without saying that the product has to be very good. If you are in a niche market, then value proposition is more important than execution.  You might not have the best quality and completeness of the product, but if there is not much competition, then you should focus on the value proposition more than the execution of completeness.
  25. Think hard on how you can leverage your happy customers. Ask for referrals. At every sale, try to leverage. Ask your referrals to write guest blogs on your site, case studies and testimonials. Photo testimonials are better than just text as they are more credible.
  26. Leverage influencers. They can tweet about you.  Follow influencers and include them with @X so they will notice you. Try to get them to follow you.  Share signups and success stories through social media. As the company grows, you need one person dedicated for social media and working with influencers, establishing connections etc.  Bear in mind that influencers love praise. It also helps if you can get thought leaders from academia writing about you.
  27. Write thought leadership articles and blogs – maybe twice a month.
  28. When you sign up a customer in a vertical, find out the competitors in their space and try to make them your customers.  Folks pay more attention if they know their competition is using your product.
  29. Set up Google Alerts on keywords so you get notified of new stuff. Then go there and leave your comments. is another site similar to Google alerts.
  30. LinkedIn groups is a good source of leads. Answer questions there. Also post questions yourselves on challenges in your domain.
  31. There are tools like pardot, marketo, for follow-ups. Use them if you see the ROI on them.
  32. Conferences are not so great from a lead generation point of view. But they are good for showing your presence in the market place.
  33. Don’t innovate on the business model, particularly when you are a startup. Go with tried and tested ones. Select the right sales model for your product depending on the kind of product and price of the product. Look at how your competition is doing it. Usually, it is better to follow their model during the initial days and then experiment later.
  34. A recommended reading for all startups is “Most startups should be deer hunters”.  Essentially, there are three types of customers – elephant, deer and rabbit.  Catching elephants is very tough until you are of certain size. Catching rabbits is very tough to survive as they are spread too thin and even if you catch one, you get only very little meat. Hence try to catch deer – which are right sized for you.
  35. For cheaply priced products, educational institutions are a good place for doing pilots and getting feedback.11268730903_6c278bfcf9_o
  36. In scale hacking, have a good sense of metrics on customer conversions.  How much revenue is being generated, from how many customers, out of how many evaluations, out of how many leads, out of how many visitors?  Measure, track and improve the rate of conversion at each stage of the funnel.
  37. Once you have had success with your first product, you should consider other products for scale hacking.  Build newer revenue streams based on the incoming cash of existing successful products
  38. Hiring cross-continent is a very big leap-of-faith for an entrepreneur.  You need to be very careful with the first set of people you hire in a different geography. Culture alignment is key to global success.
  39. Taking funding for scaling is a very good idea.  Investor money is like rocket fuel. You can either go up or fall down fast.  You can go from ‘darling’ to ‘donkey’ quite fast with VC money.
  40. All news is good news when you are small.  So don’t shy away from publicity of any form. Of course, do only those things that you are comfortable doing.
  41. Requirements should be driven by customers, where ever possible, instead of internally imagining and creating requirements which might not be of any value to your customers.  When a sales person gives a requirement, ask ‘why do we need this and how will it help’ five times.  If you can find a good answer, then the requirement is a real need.
  42. When deciding on which new requirement should be added to the product – consider the return on investment. This is commonly overlooked.  Usually, the latest incoming requirement is given more importance at the cost of an older one.  Have a methodology for choosing requirements – based on factors such as number of customers requesting the requirement, the ROI that the sales team believes this will generate and if the sales team is willing to stick out its neck for this requirement. Always use data to make product decisions.
  43. During scale hacking phase, ensure you have continuous customer feedback. Have a customer advisory board of your key customers and have a relationship manager who works closely with these customers.  Get their inputs on new features you are planning to build.  Having a good relationship with them also helps you know the pulse of the market, get inputs on competition and getting strong case studies and testimonials. Meet with key customers periodically.
  44. Channels are extremely important for scaling.  Be clear on how the channel can make money off of you.  Partners should benefit because of you. Either directly by making money or leading to sales of something else.  For example, in non-SAAS products, system integrators make money by implementation, customization and support.
    1. Partnerships are for successful products.  That way the partner can sell easily.  They want a winning product. If the product is new and complex and it has a long sales cycle – partnerships might not be of use to you.
    2. Partners can help you enter large enterprises as they are already on the vendor list. They can ‘white label’ your offering.  Getting on to the authorized vendor list of large companies is itself a very complex and time consuming process.
    3. Consider partnering with frameworks – e.g. building an add-on to an existing framework which has a good marketplace.   That way, your discovery problem is solved to a great extent. Many companies die because they struggle to reach their prospective customers.
    4. In SAAS kind of offering, traditional partnerships do not work as the partner does not make good money upfront. They do not want to wait for a long time to reap the rewards.  SAAS partner ecosystem is not there yet.
    5. Partnering with platform players like Microsoft, SAP, Oracle is a good idea in principle. But even there, promoting a startup’s product is not easy.  They have very high qualifying factors for them to select your product for promotion. For example, you need to already have thousands of users.  Partnering with platform players is a great strategy for scale hacking once you have a critical mass of users.11268764013_3a299b8f4f_o
  45. Engineer driven products are typically not so great in user experience. It might be worthwhile to hire/outsource to a UX expert. These days, coolness of UI is a very important factor.
  46. Mobile centric or mobile first is a very sound strategy for growth.  It is easier to find early adopters.


I hope that at least some of the 101 takeaways provided new data points in your startup journey.  While there is no silver bullet and each startup has to go through its unique journey, there are several common themes that are generally applicable.  And we can learn from those who have trodden the path before us.

Many thanks to iSPIRT and all the volunteers and facilitators of the Product Nation Boot Camp for this wonderful initiative.

Enterprise Sales, Product Market Fit and Partnerships: Learning from the 23rd iSPIRT Round Table

Vivek from iCreate facilitated yet another juicy round table with lessons learnt ‘from the trenches’. While this article provides a distilled summary, it cannot do justice to in-person learning.  I strongly encourage you to attend the next iSPIRT round table.

Vivek started off by saying that there is no silver bullet.  Every product exists in its specific market conditions. Different things work for different products in different domains.  Nevertheless, there are certain fundamental themes that are commonly applicable.

The fundamental problem typically during the early days of a startup is lack of clarity of what are we solving and for whom (in other words – “Product-Market fit”).  Articulating this clearly is the first thing a startup needs to get right. 

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Spend some time answering the two questions below and ensure that all of your team is on the same page. Otherwise, it will be like the classic story of six blind men describing an elephant in completely different ways.


I am better than ____ (existing way of solving the problem)

For ________ (what problem)

Because _____ (differentiation)

As a result of ____ (your secret sauce)

Answer this for your product.  This manifests in your strategy, marketing communications etc.


Create a sentence with 10-15 words.  I am better than X because of Y and solving the problem of Z. 

Articulate this clearly and crisply. Otherwise, you are confused and it is also confusing to your customers.

Without clarity, you knock on a lot of doors and have lots of meetings, but with no results.  This can be very frustrating.

Domain Knowledge

It is very important that you have a very good understanding of the domain in which you are playing.  Depth of problem understanding is a must.

Do you know who the buyer really is? It is not enough to say company C is the customer. Who exactly in the company is your customer? Why should the user spend time to understand your product? Why should the user talk to you? What is his/her role? What are their motivations and fears?  What is their procurement process? Are you sure you qualify to pass those gates?

You need to have differentiation in your product with respect to your competition. It can be things like premium domain knowledge, completeness of the solution, cheaper pricing etc.  You should be clear about your USP (Unique Selling Proposition) and articulate it to your team and prospective customers.  The differentiation should be outcome-based and not based on things like technology stack.

People pay a premium for completeness. Plus it is easier to understand. And we can show the value to the user. E.g. architecturally, well designed modules are all fine, but from the customer point of view, he needs to see a complete use case coverage.

There is a popular Hindi saying “Jo dikha hain, wo bikta hain” (meaning “only what can be seen can be sold”).  It is tougher to convince with words.  Ensure you can clearly demonstrate the value of your product in action.

Pay close attention to your problem space and understand the dynamics. For example, in banking domain, the customers are married to existing platforms such as SAP, Oracle etc. So when you make technology choices, ensure that they work with the incumbent platforms.

Product Market Fit

Product market fit is critical.  Have a plan to get to product market fit as fast as possible.  Danger is you might run out of money, so get to product market fit fast.  iCreate was providing services and used these revenues to fund their product development. This way they had a longer runway to get to product market fit.

If you need to educate the value of your product, then there is a segmentation mismatch. Better to find a market place where they see the value clearly and it is more about demonstrating your value. If you have to explain why they should use your product, then product market fit is not there.

In your universe of market place, there will be big clients, small clients and medium clients with different attributes. Do not try to solve the problem for everyone. Pick your initial target segment as narrow as possible and play there. Pick a demographic where the user sees the value immediately and get them to start adopting. You can later expand to other segments when you see success. 

Qualify your market segment and leads. If they don’t have the problem, don’t spend time with them. You will see a glimmer of hope everywhere, but you are not going anywhere.   This will give you a false sense of accomplishment and is a dangerous situation to be in.

Having a vertical offering works better than a horizontal offering (i.e. applicable to everyone in the world).  Having a generic mother of all products means multiple stakeholders need to be convinced and the message also gets diluted.  It is better to choose a specific problem and completely solve it.  You can sell faster and also sell for more and get customers faster.  For example, iCreate had a generic solution which took 9-12 months to close the deal. With a single point solution, the time reduced to 3-4 months.

As a startup, you want to do several different things, but you don’t have resources.  You need to make the hard call and pick the 1 or 2 things you want to pursue.  Platform to solve N problems takes 2 or 3 times more time than solving 1 problem.  An amorphous offering is more dangerous and takes more time.

Another example that was shared was of a language translation product. They struggled to find market fit for their generic language translation services.  Then they verticalized it to retail segment where their product translated customer messages to native language and vice versa.  They were able to then go and penetrate this market segment.

As a startup, it is challenging to verticalize a horizontal offering due to resource constraints and the temptation to have a large market size, but this needs to be done.

Finding the first customer willing to use the product is a big challenge.  Be prepared for a long grind, and it can be a very frustrating experience.  Sometimes it can take a long time to get the product market fit (several months).  However, you should keep an eye on whether you are making progress or the product is not viable as a business.  You need to introspect if you are getting product-mismatch feedback.  Set clear goals and metrics. Don’t go by sentiments.  You have to be dispassionate.  Come up with some objective metric such as “The way for me to validate X is Y”.

If founders can’t sell, nobody else can sell. Look at the offering instead of finding a sales guy.

Every company needs one or two key inflection events change the trajectory completely. You also need some luck to get your first break.  Try to get top marquee client vs. a small client.  Marquee client also helps in marketing and validation and others will have lesser resistance to trying your product.

Product Merit is a must. In addition, try to show up where your customers hang out e.g. have stalls in conferences.

The next big challenge is getting the first paid customer. Then, you need to get your first referencable customer. 

You need to inculcate champions among your existing customers.  They will also tell their peers. This is critical during early days. Investors and prospective customers want to talk to existing customers.

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Creating a Sales Team

Look for partners or non-founding sales ONLY after getting product market fit and messaging right.  Till then, the founders should be the sales team. In iCreate, pre-investor stage sales team was zero.

Initial sales guys that you hire should be comfortable with the ambiguity of startups. 

Hire folks who can put ‘skin in the game’, aligning with wealth creation (e.g. ESOP) or a percentage of revenue.  Incentives also work – for example, “If you get $X revenue in Y months, you will get a car”.  Make the incentives outcome based and not effort based

In India, typically R&D budget is much more than the sales budget, but as you get traction investment in sales should increase.  One rule of thumb is to have 60:40 (engineering to sales) during growth stage. In US, mature companies have R&D costs around 15% of revenue and 50% of revenue is invested in Sales.

If the sales team is sub-optimal, firing early is better. You might make mistakes, but it is liberating when you fire a misfit as you can focus on important things better.  

Without raising money, growth can be slower.  If you raise money, growth is much faster.  Raising money for growing is a very good idea.

Partnerships (Distribution and SI)

First, have a story to sell. You put in initial effort to get initial customers in your target geographies. Then attract partners using these success stories.

We discussed two kinds of partnerships.

  1. Distributor – who just resells your product.
  2. System Integrator (SI) – who resells your product along with implementation or other services.

In every market, nuances are different e.g. private vs. public banks, different geographies etc. You need to figure out which kind of partnership is suitable to your product.

In mature markets like US or Hong Kong, you can sell direct and may not partners.  US is a great place to do business, as you get quick and clear feedback – positive or negative.  If they see value, they will buy. However, the sales cost in US is expensive.

In emerging markets, people want in person meetings and they do not say yes or no immediately. This can lead to mixed signals and longer sales cycle.

In geographies like Africa you might have to work with local partners. Your direct sales may not work. In general, East Africa and West Africa need distribution partner to set up meetings. Then your sales guy has to do the work.  Look at sector focused players e.g. computer warehouse in Nigeria, Simba in Kenya.  

Middle East and Africa are brand conscious – they don’t want to go with small startups.

In mature organizations, SI plays a major role and has a lot of influence on decisions.  Evangelize both with SI and clients. Once SI sees a win for your product, they will want to replicate that in similar contexts.

2013-11-23 15.26.17Be generous with commissions to your partners.  Once they see the money, they’ll show more seriousness.  See if your partner can make commitments to gauge their seriousness.  The commitment is not necessarily in money terms only. For example, ask if the partner is willing to send their employee for training on your product to your location.

It was observed that strategic discussions with SIs not as fruitful as tactical ones.  If there is an immediate opportunity, SI and you can have a meaningful tactical discussion.  Strategic level discussions might give you a good feeling, but not much might come out of it.

Channel partners need to see a clear way of how and how much money they can make. Find a channel partner who already has a user base of stakeholders of your interest.  To find out, look at other players in your space and which partners they are using.

Remember that your product is just an additional product for your channel partner.

Partners want to look at value addition, not just cost or feature arbitrage.  Partners compare your deal with existing big names to see if they get to benefit more by pitching your product.  

Partners need to be given all intelligence on a platter. They don’t want to spend on learning or figuring out. They don’t want you to experiment at their cost.

Some participants were worried that brands from India might have to first fight the battle of perception of being an India based company. But feedback was that it might be an issue in the beginning, but once you get traction and the product has merit, this problem is not insurmountable.

Government tenders is a complicated process.  You need to be proactive about positioning your product even before tender process. 

2013-11-23 15.23.50

Product Positioning

There are different stakeholders in a B2B context – could be the CEO, IT Manager, or VP of a business unit.  All of them are looking at different parts of the problem (one might be looking at cost savings, one might be looking at value delivered by the product and another might be looking at maintenance costs).   Create your message for each stakeholder.

For your product positioning, consider the following:

  1. For the points of your differentiation, reinforce in your messaging.
  2. For points of parity with competition, highlight them.
  3. And for points of despair, mitigate or downplay them.

From your client’s point of view (particularly in large enterprise context) “he will never get fired for hiring a well-known brand. It will be risky for him to try a startup’s product”. Reduce the risk for your client and also demonstrate differentiated value of your product.

Proof of Concept

Instead of free proof-of-concept (POC), ask for conditional order.  This shows commitment and also the buying process will start early. In B2B context, the process can be quite long.  If the POC is not successful, the order can be cancelled.  If you can get a paid POC, that is the best.   Free POC can be a waste of time if the person driving the pilot does not have buying authority.


It is good to have an advisory committee of domain experts. This is good for validation. You can never be an expert in every area, so have advisers.  Typically, you meet them once a month or once a quarter.

There are three common models for compensating advisers:

  1. Free.  They like your passion and are willing to give you advice from their experience.  But this can be good only for some time. Otherwise, you will start feel guilty about taking their time for free.
  2. Stock options.  This is better as they will benefit when you benefit.
  3. Payment for their time. This is the standard consulting by the hour model.


While there is no silver bullet that works in every scenario, there are certain fundamental aspects that are common. 

Unfortunately, a lot of learning is experiential.  And it will take time. You’ll do wrong things but when you navigate, you can course correct earlier by having the knowledge from those who have tread this path before you.

Please share your thoughts in the comments section below.

Tweetable tweets

The first problem a startup must solve is product-market fit.  Everything else comes later. Tweet this.

It is very important that you have a very good understanding of the domain in which you are playing. Tweet this.

People pay a premium for completeness. Better to solve one problem completely than N problems partially.Tweet this.

Jo dikha hain, wo bikta hain (“only what can be seen can be sold”).  Tweet this.

If you need to educate the value of your product, then there is a segmentation mismatch. Better to find a market place where they see the value clearly. Tweet this.

If founders can’t sell, nobody else can sell. Look at the offering instead of finding a sales guy. Tweet this.

Tactical discussions with System Integrators are more fruitful than strategic ones. Tweet this.

iSPIRT Sales RoundTable: Acquiring initial customers, Early product management, Indian SME Selling

Yet another extremely educational round table from iSPIRT – 8 out of 12 participants gave it a rating of 10/10!  Girish from GreyTip and Shashank from Practo led the round table and Aneesh and Yashwanth contributed with their experience at Capillary.  This article captures some of the key learning from the round table.

The focus of this round table was on acquiring the initial set of customers, particularly in the context of SME segment in India. However, several takeaways are applicable in a general context too. Other topics included early product management, hiring and motivating the sales team and channel partners, and product pricing.

Acquiring your first customers

One of the most common and biggest pain points for a startup is getting the initial customers. Enterprises don’t want to talk to start-ups as they are looking for a mature, tried and tested product. Channel partners also do not want to talk to start-ups unless they have proven sales record and reference customers.  It’s a catch 22 situation.  Add to that the long sales cycle of 2 to 6 months and it can be a very frustrating experience.

Shashank shared the learning from Practo’s journey of acquiring the initial customers:

  1. For the first 50 customers, the CEO did the sales and got them to sign up.  
  2. The focus on the first 50 customers was on product market fit (more from product management perspective than customer acquisition).
  3. Early on, they were not focused on pricing, but on getting people to use it.
  4. They went behind early adopters who were open to technology and did not try to engage with the late majority or the laggards. For example, if they found a doctor using an old feature phone, they would not consider him as an early adopter.  Lead qualification is very important.  Focus on quality leads rather than trivial leads.
  5. In the earlier days, they segmented the market and targeted only dentists in Bangalore and only later expanded to other geographies and kinds of doctors.
  6. They spent almost the first year and half to figure out what the customer wanted.
  7. Some of the unique things they did included not giving any incentive to existing customers to refer other customers. They wanted the customer to find so much value in their offering that they would refer on their own.  They had a zero referral fee policy as they wanted genuine references.

According to Shashank, four key things that they did right were:

  1. Spending hours with the USERS to understand their needs.  They measured each and every action the user is doing and used it to qualify the lead.   They had in-built tools in their product to measure usage.
  2. They build for needs that can SCALE to several other users.
  3. Focusing on PAID needs.
  4. USAGE was their best friend. 

Girish from Greytip talked about his journey from being on-premise only software to providing a cloud based solution too. They launched their SAAS version in 2007 when it was still nascent.  To experiment, they built a small product on SAAS.  They used the beachhead strategy i.e. get a first achievement that leads way to future successes.  The beachhead strategy goes by the name of MVP (minimum viable product) these days.


During the beachhead stage, they validated aspects such as customer need, data center hosting, cloud strategy, multi-tenancy etc.  Once they saw traction, they realized there is a much bigger market and they started adding more features to the product and scaling sales.  And they experimented with different things such as free trials, doing the sale completely online etc. They also tried SEO and SCM.

For their product, they saw that free trial did not work.  Nor did they see a sale being done completely online.  Girish’s hypothesis is that for their kind of product (payroll), people want someone to speak to and hold responsible for delivery and timeliness. On the other hand, some companies have got all their sales in the Indian B2B context fully online.  That is why it is crucial to validate the assumptions in the problem space and target market. 

The key takeaway is to experiment different things to figure out what will work for a given product in a given market context.  SEO, SCM, Adwords got them leads, but fulfillment was never 100% online. It required a human to close the deal. 


Do a bunch of experiments and have clear metrics on what you want to measure to decide the effectiveness of the experiment.

Getting the first customer takes the longest time.  Getting the second customer takes much lesser time. Getting the 10th customer is much faster and getting the 100th customer more so.  Customer acquisition time drops exponentially.

Metrics is always useful to convince value to customer.  Have an ROI calculator.  Quantify the perceived loss of not using your product.

To get initial customers, do whatever it takes.  Keep chasing the right guys. Use personal references and networking to get meetings. Once you get the meeting, then it is up to the product fit and normal sales cycle.

One company got their first customer after 10 months. And then it took them 14 more months to get to 10 customers.

Get 5 or 6 testimonials and users who love your product and only then go aggressive on sales. Build the product along with 5-6 target customers. First, figure out if there is a need for the product. Follow the lean startup model that is quite popular in startup literature. It really works!

In these times, the product has to give Instant Gratification when the customer tries the product for the first time. For example, with Practo, a doctor can send SMS to a patient within 30 seconds of starting trial.  Also, using the product for the first time should be very easy.

Getting references from existing customers is the best method for a startup to acquire more customers.  Along with references, cold calling is also needed to get more leads.

For startups founded by young entrepreneurs, age can be a concern in some domains, as some people give more credibility to age. For these kinds of startups, spending efforts to acquire additional credibility helps.   For example, you can enlist the services of an industry veteran.  Or use an existing customer base as a reference.  Customers listen to someone from their community.   For example, Scheme Central went through the secretary of the jewelry association and was able to get a huge community of jewelers sign up for their promotional event.

Create case studies. And put in metrics and data points in the case study that communicates the value very clearly.

A new product needs investment in marketing for awareness creation. Webinars help in thought leadership and credibility.  You should share best practices and industry trends in webinars.   In the last 10% time you can talk about your product.  However, the results may not be immediate.  Use technologies like webex, gotomeeting, gotowebinar.

Tradeshow presence helps in getting rid of the startup tag and establishes credibility. Use tradeshows also to educate about new things, establish thought leadership and engaging the community.  Tradeshows are also places where you can get time from people, who are otherwise too busy in their work to take time out for you.  Try to connect with and setup meetings with interested parties before the event, so you can get more mileage out of the event.

Hiring and Motivating Salespeople

Startups need passionate team members for sales.  In the early stages, professional sales people are not needed, but passion is more important. 

Sales culture and values are very important.  Different companies have different values, but it is important to articulate your culture and values so the new employees can identify and relate to the culture. For example, one aspect of the values could be that “We will not give any discounts”.   This can help in reducing the sales cycle since there is no negotiation phase. 

Build internal tools for sales tracking, conversions and product usage.  It might be worthwhile to have a dedicated engineer to build and maintain sales tools.

It is not very difficult to hire foot soldier sales in India for SME sales.  Some companies have hired sales people with 2 years’ experience for 25K INR per month. Naukri is a good place to hire junior sales people.

For a startup, it might be better to hire a little experienced folks instead of freshers.  In addition to training costs, freshers also have the urge to look out for a change after an year or two.  Attrition is higher among lesser experienced employees.

The key things to look while hiring a sales person are:

  1. Communication skills
  2. Sales ability. In the interview, ask him to sell his current product to you.
  3. Relevance. Right background.
  4. Attitude.

As you scale, investing in the right recruiter is very important as it is very important to hire good candidates.

Act quickly on mistakes.  If you find someone who is not right, let go immediately. Typically, 1 out of 2 sales is good fit.

Have a transparent incentive system.  And make it non-linear so the salesperson is incentivized to achieve more.  For example, if the salesperson gets 1 to 3 deals, the incentive is Rs X per deal. For the 4th through 7th deals, the incentive is 2X and for the 10+ deals, it is 3X.

While it is important to track results, for salespeople tracking effort is also important. It helps in improving morale. For example, effort metrics are things such as number of meetings per week, 4 demos a day etc. 

Early Product Management

The product requirements should be driven by the needs of the customer. Aneesh also mentioned that they built the product after talking to retailers (their target customer segment).  The first five customers gave them the requirements and then they build the product. 

Till you get 100 or so customers (the number might be different for your product), keep making modifications so you have a good minimum viable product (MVP).

Free trials are a great way to get customers.  The trial period can be 15 days, 1 month or 3 months or whatever is appropriate in your context.  This depends on how soon the customer can see the value of the product.  If the value is immediate, then a 15 day trial should be good enough.

If a customer asks for feature X that is not currently available, ask them to pay for it, or tell them to buy the existing product and give them a commitment on when the new feature will be ready.  In India, people don’t want to say no directly and hence may come up with different missing features to indirectly say no.  Ask other customers if they want the same feature X. If 20% customers need it, then build it. 

Build metrics in your product so you can measure which features are being used by customers.  This can also help in manage the funnel.  For example, you can take these actions based on usage during the trial period.

  1. Who is using it?  Convert these people to paying customers.
  2. Who is not using it? Extend trial.
  3. Who is not using at all? Train them.

SME mindset

Pay particular attention to the most common mindset in your target segment.   For example, some SMEs have budget constraints. So being flexible in your pricing might be needed. In large enterprises, things run on budgets, so we need to be sensitive to that too. In India, price negotiation and discounts are normal expectations. You will have to decide how you want to handle this.

If the product delivers value, people will pay for it.  It is not true that the SME segment in India does not want to spend money.

In the Indian B2B SME context, the customer wants to buy from a person. In the B2B SME context, another important factor is local language communication. Not everyone is English savvy or comfortable doing business in English. So they hired local language speaking sales people.

“Me too” syndrome is prevalent in SME segment in India. They are well connected with each other.  You can leverage the “me too” syndrome by using names of your customers competition who is using your product.

SME sales can take a few weeks to a few months, depending on the kind of product and the kind of market.  If there are multiple decision makers, sales complexity increases and it can take a minimum of 3 months.

In India, customers don’t say no directly.  They might give a variety of reasons to not make the commitment and you might mistake that for genuine interest in the product. Get them to say “Yes” or “No”.  Any concrete answer is a good answer.

Channel Partners

Get at least 10 customers yourself so you have established product-market fit.  And then go talk to channel partners.  Channels will not solve the sales problem for you. You solve it first and that will get the channel excited. They can help you replicate, but not create the sales model.

Channels want to make money. They don’t want to invest in your product.  They want to take up already proven products.  You might want to put your sales guy in the channel partner’s office and make sure channel partner is making money.  Channels will take time and effort.

SAAS products are not exciting for channels as the ticket size is small and they don’t have much scope for making money from implementation and upgrade services.  In SAAS, you need to give higher commissions.  You can use channels to increase awareness.  For SAAS, marketing is more important than channel partners.

For straight forward low touch products, you deal with distributors and resellers (e.g. anti-virus software). Channel partners are typically used for high touch, high involvement kind of solutions where the partner brings in some perceived value addition.  

Thoughts on Pricing

Here are some rules of thumb to arrive at product pricing:

  1. What is the customer currently paying to solve the problem? For example, is it a person whose salary is the cost? Or it is on-premise software that you are replacing with a SAAS solution? Your product pricing has to be less than what the customer is currently paying.
  2. Your cost of customer acquisition should be less than the annual revenue from the customer.  Otherwise, it might not be a sustainable business. Cost of customer acquisition is roughly equal to total salary of sales people + some % markup for additional costs associated with an employee divided by the total number of customers acquired.  The formula might vary based on your cost model (e.g. advertisements), but you need to figure out a simple handy customer acquisition cost calculator even if it is not accurate.
  3. Life time value of the customer should be at least 3 time annual revenue from the customer (=1/churn).

Some Tips and Reference Material mentioned in the round table 

  1. 6 Cs of SAAS metrics and other resources, available at
  2. A book titled “Solution Selling”.
  3. Some of the participants found  a very good tool for salespeople.  It tells interesting things about whether a prospect opened a mail, forwarded it etc.
  4. Slides used by Shashank at the round table are here.
  5.  A very good blog for startup sales is (PUCCKA model).

Tweetable Tweets

Getting the first customer takes the longest time. Customer acquisition time drops exponentially. Tweet this.

To get initial customers, do whatever it takes.  Keep chasing the right guys. Tweet this.

Experiment with different models in your specific context to figure out what will work. Tweet this.

The customer needs to have instant gratification when he tries the product for the first time.Tweet this.

Getting references from existing customers is the best method for a startup to acquire more customers. Tweet this.

Have a nonlinear and transparent incentive plan to motivate salespeople to achieve more. Tweet this.

Build metrics in your product so you can measure which features are being used by customers.Tweet this.

In India, customers don’t say no directly. Get them to say YES or NO. Tweet this.

Get at least 10 customers yourself. And then go talk to channel partners.Tweet this.  

iSPIRT ProductNation Branding RoundTable: Why Product Branding is important for Startups?

As usual, the 16th iSPIRT RoundTable was a great learning experience. Many thanks to Avinash Raghava & iSPIRT for conceptualizing it, and to Helion Ventures for sponsoring the venue and the snacks.

Dhruv Shenoy of Knowience Consulting, a well-known Marketing Guru, was the facilitator, along with Rajan from Intuit. Thanks, Dhruv and Rajan, for an educational and entertaining session.

I used to think that product branding is only for large companies and startups and early stage companies don’t need to worry about it.  So I was skeptical at first – but I trusted Avinash’s judgment in putting together this session.  And it was an eye-opener.  Dhruv explained to us what “brand” is and why it is important for products at any stage of maturity.  Building the product without doing an exercise in defining the brand can lead to lot of wasted time and money.

Branding consists of three high level activities “What to say”, “How to say” and “How do we reach the target customer”.  This round table focused on “What to say”. Future round tables will cover the other two high level activities.

Starting with the definition of “Brand”, we covered “Customer Insights”, “Product Proposition”, “Target Audience”, “The Six Tenets of Product Branding”, “Brand Essence” and “Brand Positioning Statement”.

After reading this article, give a shot at creating a Brand Positioning Statement for your product.  From my personal experience, I assure you that it is time well spent.

What is a brand?

We normally look at only commercial products, but the concept is broader.  Mother Teresa, Lord Ganesha, Santa Claus are also brands. So are Diwali and Valentines’ day.  Or even the concept of “Brand India”.

The three key attributes of a brand are:

  1. Most Unique (not overlapping with others).
  2. Most Relevant
  3. Large following

For example, among the 33 Crores of Hindu Gods, which God is known for removing obstacles and hence needs to be worshipped first?  Everyone knows it is Ganesha. Ganesha satisfies all the three conditions above.

Brand is how consumers identify the product and recall it. Brand is built over a period of time by the consumers/target audience.  The manufacturers can do brand building activities keeping the above three attributes in mind. Brand building takes time. For example, Gmail built it over several years to overtake Yahoo.

To be successful, the product should not be a commodity. It should be a brand. For example, rice is a commodity and is talked in terms of Rs. 43/kg or Rs 50/kg. But Kohinoor Basmati is a brand.   A brand kindles attributes about the product in the mind of the consumer.

Brand creates a promise. This needs to be delivered by the product. Otherwise, it will backfire badly.

So how do we go about creating a brand for our product?  The first step is to get customer insights.

Customer Insights 

It is very important to realize that there are thousands of things going on in the customer’s mind.  How do we get into the mind of the customer and grab mindshare?  Even if you have a great product, if the customer cannot identify and recall it, you have lost the customer.

To understand how to get the customer’s mindshare, we need to get customer insights. Customer insights are at a deeper level and not just at the level of product benefits/features.  These deeper insights should be used to differentiate your product and get the customer’s mindshare. 

Here are some examples of customer insights:

(Disclaimer: All the statements about different brands and products in this article are hypotheses made by RT participants as an exercise for better understanding.  They may not reflect reality)

  • SalesForce:  Before SalesForce, companies had to make large investments in Software and have it installed and maintained on premise. This was keeping SMEs away from expensive Software. They could not afford to make such investments to see value. Subscription based, on-cloud service appeals to this customer segment.  SalesForce targeted this customer insight.
  • Dove: As women get into early 30s, they have the insecurity that they are looking older.  Dove promises that they will look younger.
  • LinkedIn: Man is a social animal and wants to keep in touch with his contacts.  In the offline world, the mindshare of friends (whom you meet at home in a relaxed environment) is different from mindshare of professional contacts (whom you meet in a coffee shop with some agenda).  LinkedIn’s insight was that what you do offline (meeting people, networking etc), you can do online also in a separate way. Online life mirrors real life.
  • Instagram:  People want to look like professional photographers. People are taking photos from their mobiles and sharing, but the photos were not looking professional.  Instagram lets you do that from your mobile.
  • Scooty: Kinetic Honda is very heavy for young girls.  They need something lighter without gears.
  • Gmail: Other mail providers were limiting the max space. Gmail came up with 10GB space.

Focus on only one thing from the customer mindshare point of view.  Which part of the customer’s problem are we solving? Focus on the deeper benefit.  David Ogilvy said “Interrogate your product till it confesses its strengths”.  What can my product do that others can’t? Without this, your brand will not have recall value.

If we have multiple product lines, then we should have a main mother brand (e.g. Microsoft) and the sub brands for individual product lines (e.g. MS Office).

Study the market dynamics and focus on customer insights.

  1. Customer Insights should be the foundation of business planning.
  2. Remember that customer attitudes are never static.
  3. Customer insights are the key to building a discriminator.

How do we go about getting customer insights?

  1. Usage.  This is the best way – find out how the customer is using your product and take feedback.
  2. Observation.  For example:  shopping insights, product usage analytics, surveys, research.
  3. Probe. Ask open ended and close ended questions and analyze responses.

The best way to get consumer insights is to go back to the people who are using your product and find out why they are using it.  This will also give you insights on your product differentiation.

Ask customer to describe your product.  It can illuminate you on what you think your customer thinks (apologies for the thought twister).

Once you’ve got the customer insights, the next step is figure out which insight you want to target.  And that brings us to “Product Proposition”.

Product Proposition 

How will my product be different with respect to the competition?

  1. Filters down from consumer insights.
  2. Discrimination starts with the product.
  3. Brand builds on product promise.

Here are some examples:

  • iPod: iTunes + iPod. Buy one song instead of an album. Biggest storage capacity.
  • Nissan Sunny:  More legroom for people sitting in the back seat. Longer car in the same category (i.e. at Sedan cost).
  • Google:  With earlier search engines, you had to think what to type. Google addressed this with “Search the way you think”.
  • Flipkart: Hassle free delivery.  Very fast.
  • Maruti Car:  How much mileage? Value for money.

It is very important to be unique on some dimension – even from the day you conceptualize the product.  And, the product proposition has to be very simple to have recall in the customer’s mind.  One rule of thumb is to aim to explain your product to your child/grandmother.  Typically, this can be done.

Think of what is keeping your customers awake at night.  And use that to grab the customer’s mindshare. For example, let’s take my company’s product – KeyMails – which solves the problem of email overload for Microsoft Outlook users. The insight could be that the target customer is worried about missing an important mail. So, something like “Never miss an important mail” could be one approach to branding.

Think in terms of “Unique Atomic Unit” about your differentiator.  For example, with facebook it is “update status”; with twitter, it is “very short message”.  Spend some time thinking about what the unique atomic unit is for your product.  Do it now.

Go to market with the differentiating “hero” feature.  Other features are needed, but they do not form part of go to market strategy.  Example, Scooty is a vehicle that has good mileage and a good engine, but they focus on their differentiating factor of being usable by girls.

Once you have the product proposition, the next step is to understand the target audience.

Target Audience

You need to have answers to the following questions about your target audience:

  1. Why should we understand the target audience?
  2. Who are we talking to? And why?
  3. What are his/her attitudes to the category?
  4. What defines him/her?

For example, for Naukri, the recruiter thinks he needs their service if he needs to hire 200 people in a month. If it is just for one or two positions, consultants might work better. This customer attitude is important to know.  Online recruitment is for scaling.

You need to create a persona for the target customer. In the initial stages of a startup, it is better to have only one target persona.  Having multiple target personas causes confusion.  Pick the persona that is most promising.  The persona needs to change and be refined as you get more data.  For example, though Practo is a general purpose solution for doctors, they first picked dentists and later expanded to other segments. “Everybody is my customer” does not work.

Give the target persona a name – say Molly/Tom/Rohan and write down as many attributes as you can about the persona – what is the annual salary, spending habits, attitude towards buying products similar to yours etc. This helps in identifying who is a target customer and who is not. This will also help in decision making – for example, if you want to add a feature – ask if Rohan will like that feature. And base your decision on the answer to this question.

You can have multiple target personas once you become more mature.

What if there are multiple people who are involved in the buying decision for the product? Who should you focus on? Your pitch should be to the buyer. You have to talk to the users and the influencers too, but the pitch must be to the buyer.

With this background, it is time to introduce the six tenets of product branding.  This is a concise summary of the discussion so far.

Six Tenets of Product Branding

You need to study and arrive at your understanding of the following six pillars.

  1. Market Dynamics
  2. Target Audience
  3. Consumer Insights
  4. Competitive Environment
  5. Key Brand Benefit.
  6. Reason to Believe.

If even one of the above is not satisfied, you might not get the results. For example, one of the most common reasons for failure is that brands do not address the “Reason to Believe”. It is easy to make tall claims, but the consumers must clearly see the reason why they should believe your product’s differentiator.

All the learning above are inputs to two tangible outcomes for your brand – (a) Brand Positioning Essence and (b) Brand Positioning Statement.

Brand Positioning Essence 

“Brand Positioning Essence” typically consists of two to three words.  It is that one aspiration of the core target audience that the brand would like to uniquely own.  For example, “Feminity Restored” can be the essence for a soap targeting middle age women.

Take a few minutes now to think about those two or three words that communicate the essence of your product.

Brand Positioning Statement

Create a Unique Brand Positioning Statement that covers the six tenets above.  A template for your statement is given below:

My product is a ________ (market dynamics) for ______ (target audience) who are ______ (consumer insights) and my product does _________ (key brand benefit) because ____ (reason to believe).

Here is a shot at KeyMails brand positioning statement.

“KeyMails solves the problem of email overload for business people who use Microsoft Outlook, and who do not want to miss important mails; by ranking the mails in the order of importance to the user, by automatically learning from the past email behaviour and easy and minimal configuration.” 

I request other participants to write down their unique positioning statement for the benefit of the readers.

For your reference, here is the silde deck used by Dhruv for the round table.


Branding is a must for any product, whether it is in a mature stage or early stage.

Particularly for product startups, the “brand” of the product is important. It is more challenging when the product is still evolving and the startup is trying to figure out the product-market fit and a minimum viable product.  However, brand is in the mind of the customer and it is evolving. It can change with product market fit, but it has to be present at every time.  You always need to have a differentiating factor that addresses a deep need for your target audience.  And your brand positioning can and must change as you change product strategy.

It is similar to your business model.  It is not advisable to start building a product without having a business model and business plan.  Sure, it will change and evolve over time – but at any point in time, you do have a business plan.  Same thing with branding.

If you’d like to share your knowledge on product branding, please do write them in the comments section.

Tweetable Tweets

Branding is as important to startups as it is for mature products. Tweet this.

Brand creates a promise. This needs to be delivered by the product. Otherwise, it will backfire badly. Tweet this.

Thousands of things are going on inside the customer’s head. How do you get mindshare for your product? Tweet this.

Even if you have a great product, if the customer cannot identify and recall it, you have lost the customer. Tweet this.

Customer insights are at a deeper level and not just at the level of product benefits/features. Tweet this.

Focus on only one thing in the customer’s mindshare. Without this, your brand will not have recall value. Tweet this.

The best way to get consumer insights is by asking people who are using your product why they are using it. Tweet this.

Ask your customer to describe your product.  It can illuminate you on what you think your customer thinks. Tweet this.

Go to market with the differentiating “hero” feature.Tweet this.

Create a persona for your target customer. Give a name like Tom and write down Tom’s attitudes. Tweet this.

Brand positioning essence is two or three words that you’d like to own in the customer’s mind. Tweet this.

Create a brand positioning statement addressing the six tenets of product branding. Tweet this.

iSPIRT Sales RoundTable – Startup Sales, Lead Generation, Channel Partners

First of all, huge thanks to Vizury for sponsoring great food and the premises to hold the round table. Many thanks to Aneesh, NRK Raman and Srirang for leading the session and providing valuable inputs. And of course, to all the participants for the energetic discussions and knowledge sharing.

Here are the key takeaways from my notes.  Please note that there are several nuggets of practical advice based on the experiences of the session leaders and the participants, and not just standard text book stuff. It was a great learning experience for me and I hope I can pass on some of it to you.

While we touched upon a lot of topics, we spent considerable time on startup sales, channel partners and selling to geographies outside India, and lead generation and qualification.

Read on to know more.

Startup Sales and Hiring Salespeople 

Best guys to sell during early stages of the startup are the co-founders themselves, even if they don’t have sales background.  Initially, you will stumble, but you will learn and figure out what works for you.  If founders cannot sell the product in the first 1 or 2 years, then you must seriously evaluate the viability of the business

Once you’ve made the initial sales yourselves, then you put in a structure. External sales guys need to have conviction in the product to sell it.  That will be lacking during the early stages of the company – but founders have that conviction.  Hence founders can sell better during the early stages.  One participant mentioned that for the first 3 years, he and his co-founder were selling and only later they looked at a professional sales person.

Getting the first reference customer is always the toughest part. One you have a reference customer, momentum will build.

Hiring an external sales guy is not a good idea at the beginning.  Identify folks from engineering and customer facing teams who have the aptitude or inclination to do sales and ask them to lead Sales.

Culture fit is very important in a sales person. Also, check if the person has spent 4+ years in a single company – that shows that he has been delivering results.  Sales people should also be pushing back to you.  This shows that they are getting feedback from the field and are informing you about market situation.

It is a good idea to raise investor money to scale up business development.  Investors are willing to invest in this once the product has been validated and you have a few customers.

You need to experiment to figure out what works for you. For example, for a company that made trading software, an ex-trader worked great as a salesperson instead of a seasoned sales guy, because the ex-trader was able to relate to the customer.

The sales person should have hunger and also have a good history of past successes.  Consider the age of the sales person too – in some industries, an older person might work better as the customers expect to see maturity.

Like pair programming, “pair selling” is also a useful thing to try.  This helps in DNA match, culture fitness.  Some companies have paired an account manager or a product manager with the sales guy.

In complex sales where there are multiple stakeholders from the customer’s side, ensure that you sell individually to all the influencers.

You need to pay close attention to how the customer buys.  Branding and marketing engine is also very important in “creating a desire in the customer to buy”.

Channel Partners (local and global)

When creating partnerships (in the context of channel partners and resellers) globally, be careful what works and what does not in that culture.

In general, partnerships work well outside your headquarters and you can have multiple non-exclusive partnerships.  People like to do business with a local person.

Look at the credibility of the partner.  Is the partner knowledgeable and up to date in your domain?  For one company, partnerships worked well in Brazil, but did work very well in Europe.

When you set up an office in other countries, you need to be aware of the labour laws regarding how easy/difficult it is to fire non-performing employees, taxation, accommodation etc.  Going with a partner alleviates all of this to a great extent.  However, you need to have someone from your team who is responsible for managing partnerships.

Remember that the main motivation for the channel partner is money. So make sure there is enough for them so you have their mind share.  Even if that means that the channel partner makes more money than you.  Initially, you need to be very involved so the partner tastes success. For example, you need to generate leads to the partner, go along with him to complete the sale and let him make the money from your efforts, initially. This will get them excited.

Similarly, if you want to have sales offices or channel partners in other locations, encourage well performing sales folks from headquarters to move to that location, stay there for a few years to set up processes, signup channel partners, hire local people and train them.

You can start by signing an MOU first and have some targets.  Then after 6 months of so, you can sign a formal partnership agreement.

One company also pays 20% of the salary of an employee of the channel partner.  Then you can have a joint business plan with your partner to set goals, metrics tracking etc.

You should look at your customer acquisition cost and consider pay a huge chunk (say 80%) of that cost to the channel partner.

While making sure that you do not have exclusive agreement with a single partner, be sensitive that having multiple partners in the same geography can lead to partner conflicts which in turn could be bad for your business.

Also, look at companies that sell complementary products. Maybe you can partner with them too so they make money by cross selling your product.

Channel partners are not really a must. If you can make your product easy to setup and use, then you can focus more on marketing, google adwords etc (e.g. SAAS models).  Also, in these models, you need to ensure that partners have good incentives as typically the ticket sizes are smaller and they don’t have opportunities to make money from “implementations”, training etc.  One company took an approach to let the partner decide the pricing in a particular geography with the agreement that a percentage of the revenue goes to the partner.

However, if the product is not easy and you need people on the field to educate the customers, you should definitely consider channel partners.

Sales Engine is similar to Engineering Engine

One of the biggest challenges faced by Indian product companies is that the founders do not have a sales background.  Our ecosystem has evolved to a point where we can build great products, but lack the sales acumen.  There was consensus among the participants that sales is much harder than engineering. Engineering, while no doubt hard, is still manageable.  We know the inputs, outputs, risks and mitigations with a high degree of certainty.  Sales is a different beast with lots of uncertainties.

Srirang guided us to treat the sales engine also similar to the engineering engine.

The three pillars for the Sales Engine are (a) People, (b) Processes and (c) Technology.

People: Competencies, Incentives, Org Structure.  As in engineering, there can be a magnitude of difference between an average sales person and a good salesperson.  So hiring the right candidate is very important.  And you have to set up the correct incentive program and org structure to ensure motivation and excitement in the sales team.

Processes: Strategy, Execution, Metrics.  Again, as in engineering, you need to define the strategy, the execution plan (who does what) and what metrics you are going to use to measure execution. 

Technology:  Enablement, Communication, Monitoring.  Sales team needs to be enabled.  For example, ensure flawless demonstrations and training to the sales people so their selling experience is smooth and they focus on the customer.  Use the right tools (e.g. Excel, CRM, SalesForce) to track and monitor their activities.

At different stages of the company, you need different kinds of pillars – which means you need different kinds of sales people, different processes and different technologies.

Lead Generation and Qualification 

The classic sales process consists of five stages:

  1. Lead Generation.
  2. Lead Qualification
  3. Relationship building
  4. Solution design
  5. Negotiation and Closure

Depending on the kind of product, some of the later steps might not be relevant, but lead generation and lead qualification are of primary importance.

Focused lead generation is better than generic lead generation.

Some companies have used databases of leads to generate leads and have found it useful for mass email campaigns.

LinkedIn is a good source to connect with prospects (with premium account, you can send InMail too).  After connecting, you can then try to have a call/skype to show your value proposition, if there is interest.

Someone mentioned that LinkedIn Ads worked for them.  On Google adwords, there were mixed reactions.  Some say it is costly, but it helps to put the word about the product. Google adwords can generate a lot of leads, but people also noted that there was a lot of churn from these leads (in the context of SAAS based business).

If you have a horizontal product, make a vertical offering. Your campaigns have to industry specific and you should talk their language. Customers are looking for a reference customer they can relate to.  This produces better results than targeting all verticals with a horizontal positioning.

Metrics is very important in the sales engine.  You must be measuring and tracking customer acquisition costs. And track them at various stages of the sales funnel.  For example, let’s say you generate 1000 leads, out of which 600 are then qualified, 400 of them get to proposal stage, 200 get to negotiation, 150 closed and then 130 retained for renewal.  At each stage, you must count the man hours spent and put a cost for that.  This will help you improve your sales processes – particularly in the area of lead qualification as you can see what kind of leads are working and you can pursue folks who are likely to buy.

The first step is to establish Qualification Criteria. Then evaluate each lead and assign score to lead based on the qualification criteria.  Based on the score, put the lead in one of three action buckets – pursue, drop or nurture (i.e. keep warm).

Also, ensure you pay attention to negative attributes to qualify leads based on your experience and judgment – e.g. if a company has greater than 2000 employees, then they might not be suitable to your business.

Don’t take up a wrong customer at startup stage. It can be a drain on your resources.

There are three main aspects of lead generation.

  1. Publish
    1. Blogs
    2. Website
    3. Industry Magazines
    4. Whitepapers
  2. Promote
    1. Speaker in conferences
    2. Advertisements
    3. SEO
  3. Connect
    1. Email
    2. Cold call
    3. Road shows
    4. Referrals
    5. Social Media


The discussions “raised awareness” and provided lots of data from practitioners.

The key thing to remember is that there is no silver bullet and what worked for someone else may not work for you. Kishore Mandyam went one step further and said that what worked for them six months ago might not work for them now!  While there is no magic wand, you can look at general guidelines and best practices from the experiences of 20 odd practitioners.

If you have any more tips or best practices, please do write them in the comments section.

Tweetable Takeaways

Best guys to sell during early stages  are the co-founders, even if they don’t have sales background. Tweet This.

Getting the first reference customer is the toughest part. One you have that customer, momentum will build. Tweet This.

Channel partners should make enough money off you. It is OK for them to make more money than you. Tweet This.

Invest in channel partners so they invest in your product. Tweet This.

Sales Engine is similar to the Engineering Engine. Tweet This.

If you have a horizontal product, make vertical offerings. Industry specific campaigns work better. Tweet This.