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Selling expensive enterprise products does have a longer sales cycle than cheaper consumer products, and increments to your revenue come in more discrete blocks

Selling expensive enterprise products does have a longer sales cycle than cheaper consumer products, and increments to your revenue come in more discrete blocks. But that doesn't invalidate pg's argument about growth: you just have to use other proxies to estimate your trajectory. For example, instead of active users you track a number of leads and how interested they are. Even without a single closed deal, you can measure your sales pipeline. It is an imperfect proxy for potential revenue growth, but so is daily active users for consumer internet startups. Thus, if you are planning to sell an enterprise solution costing $100000, and you think you are going to make these kind of deals a few times a year in the beginning, then you use your sales pipeline measurements to estimate your growth with a finer granularity than a big sale now and then.

pbharrin 14y ago
An estimate of your sales pipeline isn't proof you have traction, it's an estimate: not worth very much.
nwenzel 14y ago
From my experience selling services and products to large companies for the past 10 years, "interest" doesn't mean much. Everyone is interested. You don't have anything until you see the signature. And I don't mean the signature on the contract. I mean the signature on the check. I agree with you that pg's point about startup growth is not invalidated by the realities of enterprise selling. But I think te way past those realities is to change the rules of the game. The "sale" should be a low-friction agreement to do business at some cost per unit/user/GB/etc. Growth is the. The ability of the product to go viral within the account. Essentially, it becomes the same process as a consumer sale with the one additional step of getting approved to sell into that batch of consumers. While that might seem to be a big negative against starting an enterprise business, the advantage is that you're then convincing people to spend someone else's money which is easier than convincing them to spend their own. How else could a $.99 app look, feel, perform better than a $100,000 peice of enterprise software.

pbharrin 14y ago

An estimate of your sales pipeline isn't proof you have traction, it's an estimate: not worth very much.

nwenzel 14y ago

From my experience selling services and products to large companies for the past 10 years, "interest" doesn't mean much. Everyone is interested. You don't have anything until you see the signature. And I don't mean the signature on the contract. I mean the signature on the check. I agree with you that pg's point about startup growth is not invalidated by the realities of enterprise selling. But I think te way past those realities is to change the rules of the game. The "sale" should be a low-friction agreement to do business at some cost per unit/user/GB/etc. Growth is the. The ability of the product to go viral within the account. Essentially, it becomes the same process as a consumer sale with the one additional step of getting approved to sell into that batch of consumers. While that might seem to be a big negative against starting an enterprise business, the advantage is that you're then convincing people to spend someone else's money which is easier than convincing them to spend their own. How else could a $.99 app look, feel, perform better than a $100,000 peice of enterprise software.