Like Marc Anderssen once said “the thing I love about startups is that you have only 2 feelings, horror and euphoria.” One can argue whether it’s a good position to be in, but every entrepreneur will agree that Marc is completely right and I‘ve learned that biz dev possibilities are not an exception.
From the day (two weeks ago) my startup launched its first product I’ve had around 3 new biz dev ideas on how my startup’s newly-born product could reach more websites and expand revenues. It starts with the feeling of euphoria, continues with horror and every now and then finishes with euphoria.
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So a little bit of background info so that everyone will be on the same page:
My startup is a “SaaSy,” self-service kind of business that is approaching SMB’s e-commerce. One of our main goals is to get potential customers into our website and improve our site conversion rate over and over again.
Like every entrepreneur out there I’m certain that there are so many e-commerce platforms, agencies, websites, apps, you name it, that could benefit from our solution.
One of the best ways to expand a new product is to partner up with a great company. For example our company created a simple partner program for e-commerce design/development/consulting companies and the results so far have been amazing. It has not been easy but the end results have been positive.
The tough thing is that biz dev possibilities are endless and you need to invest time and effort into each one, and that sometimes is way too expensive.
Here are a few lessons I have learned and am still learning on biz dev at the early stges:
Like everything, the product comes first
In order for anyone to even agree to talk to you on the phone your product must be good, simple and super attractive. Until we knew our early customers, advisors and friends told us our product looked great, but I didn’t succeed in signing a single deal. If you are the one at your company that is in charge on biz dev and partnerships then I really hope you are a product ninja as well. It is important to make it clear that I’m not talking about a 30-person company for you 4-8 person lean machines out there.
Biz dev and partnerships take time and effort
Just think of all the material you need to prepare: a partner page on your website, a one pager explaining your added value, a live demo with the service working, an agreement, meetings, phone calls and I’m sure I’ve a missed a few. You must really weigh up the decision, because not all of deals are worth it.
If it is not mutually beneficial it isn’t going to work
One of my mistakes was trying to over sell the deal. I learned that biz dev in the early days is like a very tough sale. It takes time to learn the right words as well as to perfect your pitch. One thing is clear, if the other sides added value is not clear (revenue, traffic, downloads or whatever your service can offer) it is just not going to work.
As a first time entrepreneur, how do I reach all those people?
After I figured out which companies were the most likely to benefit from our software, I needed to figure out what my “entrance point” was at the company. I call it an “entrance point” because it is a combination of the position you want to reach and whom you can actually contact. For a lot of first time entrepreneurs it is very hard to reach people through a good reference. I use LinkedIn in some cases but the better references come from investors, advisors and people that are close to the company. I think that was the point in time when I really understood the value of strong, well networked investors and advisory board team.
The best advice I can give here is to start networking with as many people as you can from the day you start the company, trust me you will need them.
Most of the time it doesn’t work, but when it does…
Even when all of the above happened correctly and agreements swapped hands, in many cases deals didn’t happen. For example, I worked for two months on a strategic partnership (yeah long before we had a product) and eventually it didn’t work out. As a true believer in sharing amongst the team members and being as transparent as possible, you can imagine the entire team’s disappointment.
On the other hand there is no feeling like seeing a biz dev thought through and seeing the added value you have created for your partner. You can see it in your partner’s pitches, the team’s excitement, and in the investor’s joy. You can’t sleep, and not because you worry but because you are starting to see how you are starting to take over the world.