4 ms·

Enterprise customers pay a lot once you get them paying, but selling to them is brutally hard.

by pg 13y ago

apaprocki 13y ago
Cold selling a large org is brutally hard. Usually what winds up happening is that internally in the org, there are people who follow what options are available in a particular space and are in a position to champion them. Companies need to find these people and then help these people make the convincing argument. If users internal to an org want to use product X, they will do much of the hard part of selling for you. You can find these people all over the place -- meetups, confs, blogs, etc.
- tptacek 13y ago
  That's true, but what you can't really do is target those people passively. You need hunter-gatherers to find them, corral them, and set up a collaborative sales process with them. Graham calls this "brutally hard", but what it really is is expensive: it requires direct sales teams, which in turn requires a founding/managing team that knows how to (a) hire and (b) manage direct sales teams. Those tasks, tasks (a) and (b), are probably what's really brutally hard about enterprise sales. When an inexperienced founder/manager hires a direct sales team, the sales team sets to work on selling the founder/manager instead of the customer base. An alternate path to getting a beachhead in an enterprise market is consulting. It's much easier to sell services to bigcos than products. Delivering services to someone gets you ~60% of the way to being able to sell products to them. The other 40% you can do on your own. That's worked for us (to greater/lesser extent depending on the specific offering we're talking about). But "consulting" is toxic to the species of startup we talk about on HN.
  - napoleond 13y ago
    When an inexperienced founder/manager hires a direct sales team, the sales team sets to work on selling the founder/manager instead of the customer base. This made me spit out my coffee. I've never heard it expressed that way, and it's a hilarious image, but come to think of it I've observed that situation more than once. Can anyone recommend some resources for learning to manage direct sales teams?
  - _dps 13y ago
    > But "consulting" is toxic to the species of startup we talk about on HN. FWIW, we grew out of a consultancy into a more HN-compatible startup through precisely the path you describe. Most of our investors, who are traditional get-big-or-go-home investors, see our "consultative sales" as an asset, not a liability. In particular, having that as a backstop is very useful for achieving PG's prime directive of startups, i.e. "don't die". My understanding is that Heroku's origin story was similar (growing out of a Rails-app consulting shop). So there's definitely room for interpolating between the two if one is so inclined.
  - apaprocki 13y ago
    > You need hunter-gatherers to find them, corral them, and set up a collaborative sales process with them. I guess it depends on what the product is. I've initiated contact in a bunch of cases (mostly situations where the product is a public SaaS or already well-liked) and in others, evaluating a product stems from of a conversation at a meetup or conf. IMO, the best thing anyone can do is make the product discoverable. If it has competitors, write blog posts and clear feature comparisons (they don't all have to be positive, either). If performance matters to whatever it is, write objective benchmarks and discuss performance aspects/tradeoffs. If it is something with an API, try to ensure there are a variety of platforms supported. This stuff is all good-to-have anyway, but many companies might not realize that people from large companies are browsing their sites and leaving unsatisfied. I think developer-evangelist roles actually play a big part in this. Having someone set up real-world use cases and blog about them or post code somewhere can really help a customer out who just wants to try something but doesn't want to spend a lot of time doing it. If the product is private, maybe have an easy way to generate an expiring VM image with some kind of demo setup so that you can quickly send it to leads. There's not a single person on earth that wants to do rounds of conference calls and in-person visits to just play with something. > It's much easier to sell services to bigcos than products. I've found the exact opposite, but maybe it depends on what you're referring to exactly. Carving out budget dollars for "3 people @ X/hr" is much harder and more scrutinized than product. "Product" is a loose term, though. "1-yr license" or "1-yr maintenance contract" are products, not consulting, even though the company selling them might not view them that way. When it comes to SaaS products, we typically want to buy an appliance (read: VM image) that just works, deals with some form of standard authentication/authorization tech (LDAP/AD, OAuth, SAML, OpenID), and x-yr support contracts. Per-seat licenses usually involve more effort. Purchasing professionals are looking to mitigate risk. They don't want to enter into a purchase that has an attractive up-front price, but open-ended potential rate hikes down the road.
    - tptacek 13y ago
      It may be the case that developer offerings are easier to sell into bigcos than other services. For my part, I have (a) had no luck selling products into enterprises using passive sales techniques (blogging "developer evangelist"-type strategies being an example of passive sales), and (b) talked to a bunch of other people who report similar results. Regarding consulting: yes, 3 full-time consultants as staff aug is hard to sell. But most consulting projects aren't like that. Our typical project is 2 people, 2 weeks; we scale down to 1 person/week easily. A 1 p/w project isn't hard to sell at all.
- greenyoda 13y ago
  Also, once you sell to one division of a large company, it becomes easier to sell to other divisions, assuming that there are people in the company who end up liking your product. And if your company has multiple product lines, you may also end up selling additional products to existing customers, which is also easier than an initial cold sale.
nl 13y ago
Yammer?

Enterprise customers pay a lot once you get them paying, but selling to them is brutally hard.

by pg 13y ago

Enterprise customers pay a lot once you get them paying, but selling to them is brutally hard.

Cold selling a large org is brutally hard. Usually what winds up happening is that internally in the org, there are people who follow what options are available in a particular space and are in a position to champion them. Companies need to find these people and then help these people make the convincing argument. If users internal to an org want to use product X, they will do much of the hard part of selling for you. You can find these people all over the place -- meetups, confs, blogs, etc.

tptacek 13y ago
That's true, but what you can't really do is target those people passively. You need hunter-gatherers to find them, corral them, and set up a collaborative sales process with them. Graham calls this "brutally hard", but what it really is is expensive: it requires direct sales teams, which in turn requires a founding/managing team that knows how to (a) hire and (b) manage direct sales teams. Those tasks, tasks (a) and (b), are probably what's really brutally hard about enterprise sales. When an inexperienced founder/manager hires a direct sales team, the sales team sets to work on selling the founder/manager instead of the customer base. An alternate path to getting a beachhead in an enterprise market is consulting. It's much easier to sell services to bigcos than products. Delivering services to someone gets you ~60% of the way to being able to sell products to them. The other 40% you can do on your own. That's worked for us (to greater/lesser extent depending on the specific offering we're talking about). But "consulting" is toxic to the species of startup we talk about on HN.
- napoleond 13y ago
  When an inexperienced founder/manager hires a direct sales team, the sales team sets to work on selling the founder/manager instead of the customer base. This made me spit out my coffee. I've never heard it expressed that way, and it's a hilarious image, but come to think of it I've observed that situation more than once. Can anyone recommend some resources for learning to manage direct sales teams?
- _dps 13y ago
  > But "consulting" is toxic to the species of startup we talk about on HN. FWIW, we grew out of a consultancy into a more HN-compatible startup through precisely the path you describe. Most of our investors, who are traditional get-big-or-go-home investors, see our "consultative sales" as an asset, not a liability. In particular, having that as a backstop is very useful for achieving PG's prime directive of startups, i.e. "don't die". My understanding is that Heroku's origin story was similar (growing out of a Rails-app consulting shop). So there's definitely room for interpolating between the two if one is so inclined.
- apaprocki 13y ago
  > You need hunter-gatherers to find them, corral them, and set up a collaborative sales process with them. I guess it depends on what the product is. I've initiated contact in a bunch of cases (mostly situations where the product is a public SaaS or already well-liked) and in others, evaluating a product stems from of a conversation at a meetup or conf. IMO, the best thing anyone can do is make the product discoverable. If it has competitors, write blog posts and clear feature comparisons (they don't all have to be positive, either). If performance matters to whatever it is, write objective benchmarks and discuss performance aspects/tradeoffs. If it is something with an API, try to ensure there are a variety of platforms supported. This stuff is all good-to-have anyway, but many companies might not realize that people from large companies are browsing their sites and leaving unsatisfied. I think developer-evangelist roles actually play a big part in this. Having someone set up real-world use cases and blog about them or post code somewhere can really help a customer out who just wants to try something but doesn't want to spend a lot of time doing it. If the product is private, maybe have an easy way to generate an expiring VM image with some kind of demo setup so that you can quickly send it to leads. There's not a single person on earth that wants to do rounds of conference calls and in-person visits to just play with something. > It's much easier to sell services to bigcos than products. I've found the exact opposite, but maybe it depends on what you're referring to exactly. Carving out budget dollars for "3 people @ X/hr" is much harder and more scrutinized than product. "Product" is a loose term, though. "1-yr license" or "1-yr maintenance contract" are products, not consulting, even though the company selling them might not view them that way. When it comes to SaaS products, we typically want to buy an appliance (read: VM image) that just works, deals with some form of standard authentication/authorization tech (LDAP/AD, OAuth, SAML, OpenID), and x-yr support contracts. Per-seat licenses usually involve more effort. Purchasing professionals are looking to mitigate risk. They don't want to enter into a purchase that has an attractive up-front price, but open-ended potential rate hikes down the road.
  - tptacek 13y ago
    It may be the case that developer offerings are easier to sell into bigcos than other services. For my part, I have (a) had no luck selling products into enterprises using passive sales techniques (blogging "developer evangelist"-type strategies being an example of passive sales), and (b) talked to a bunch of other people who report similar results. Regarding consulting: yes, 3 full-time consultants as staff aug is hard to sell. But most consulting projects aren't like that. Our typical project is 2 people, 2 weeks; we scale down to 1 person/week easily. A 1 p/w project isn't hard to sell at all.
greenyoda 13y ago
Also, once you sell to one division of a large company, it becomes easier to sell to other divisions, assuming that there are people in the company who end up liking your product. And if your company has multiple product lines, you may also end up selling additional products to existing customers, which is also easier than an initial cold sale.

nl 13y ago

Yammer?