There are many wonderful things about creating digital products for consumers, but the business model usually isn’t one of them. Getting consumers to pay for software is tough; they’ve been habituated to believe that it should be free or close to it.
Enterprise, not so much. Businesses spend a ton of money on software. Which is one of the many reasons I now work in enterprise: there’s an honest exchange of money for services. Rather than guessing what consumers want and hoping to get lucky, companies will tell you what they need and then write a check if you can deliver it. They’ve no interest in bullshitting you. As a result, product and business roadmaps can be built around articulated customer demands.
But that doesn’t mean it’s easy. Entrepreneurship in enterprise is not for the faint of heart. Here’s what I wish I knew when we started StoryDesk 2 years ago.
1) Companies don’t want, and will not pay for, minimum viable products. They want software they can rely on for critical business functions. Early products that you might ship to consumers, buggy and feature incomplete, don’t sail with enterprise. Doesn’t matter if it’s cheap or even free – companies seek reliability and continuity above all. So make sure you build in ample time for testing and QA into your product development timelines. A MVP might be a good way to vet and validate the market, but don’t expect people to pay for it until the product is stable to a fault and feature complete for the solution you are selling.
2) Sales cycles aren’t long – they’re ridiculously long. In a NTW product in an emerging market, prepare for sales cycles that are 3-6-12 months long. Lowering the barriers to adoption through free trials and self-service adoptions can compress these timelines. But whatever your expectations are for close rates and sales cycles, lower them. That said, once the product has been figured out and you’ve nailed the pitch, things will pick up. That’s what I’m seeing in our business. It’s very exciting.
3) Content is king. Blog posts, thought leadership, videos, white papers – this is the honey in the fly trap. Devote a big chunk of time to your content marketing effort, as this is by far the best way to attract leads, let potential customers educate themselves, and then have more efficient sales conversations when they’re ready to buy. Done well, content widens the funnel and shortens the sales cycle.
4) Reduce sales risk for your client. The project leader’s first goal is not to get fired. After all, he/she’s got a minivan, a mortgage, and nice big company benefits package. He/she isn’t going to bet that on a “speculative” software product. No one ever got in trouble for making the safe bet. Your startup is unlikely to be the safe bet (otherwise you wouldn’t be a startup). So, find ways to reduce the risk for your client. A proof-of-concept , a pilot project, a money back guarantee (not recommended, but certainly not uncommon) are all ways to do this. Make the cost of failure (capital or political) low, and talk up the potential upside.
5) Follow up. Follow up. Follow up. Closing deals is very hard. The only way it happens is if you go after it with tenacity and diligence. Shelve your pride. Business is won by the individual with the greatest capacity for rejection. All those girls who shot you down in high school? Send them a thank you card – they’ve done you a great service.