Funding is, without a doubt, a crucial phase in a startup’s lifecycle. It gives you a certain platform to compete with other big companies and scale your brand simultaneously.
But I’ve come to realise that the only true capital that matters is customer capital. Acquiring investor capital is no milestone in itself.
It merely funnels your efforts to generate more customer capital.
And when it comes to generating revenue, the enterprise market is like a jackpot – you hit it right and you’re well and truly on an upward curve. That said, closing huge enterprise deals has been quite a tough nut to crack for startups.
One of the main reasons for this is that many of them are not building for the scale and expectations of Enterprise businesses. In other words, they don’t seem to be Enterprise ready.
So, what is it that startups need to be doing to start selling to larger companies and boost customer capital?
Related Article: 5 Quick Ways To Scale Your Startup With Technology
(This is merely a concept note – Enterprise Readiness entails a lot of other details which are not covered in this post)
Build A Truly World Class Product For The World
Focussing on the Indian market alone won’t suffice to create a billion dollar company. There’s only so much you can expand within India which is why it is essential to break boundaries, targeting powerful markets like North America, Southeast Asia and many more.
When we are taking our product into these competitive market spaces, the one basic rule that we follow (and you should too!) is to ensure that what we are selling is truly ‘world class.’ It is acceptable if our product becomes a bit sophisticated as an upshot of creating something truly remarkable. But the bigger point is that, right from day one, the vision should be aligned with creating a product that is meant for the world so that any market in any nook and corner of the globe can find true value in it.
While doing this, do not get into the habit of benchmarking against local competitors. Local competitors cater to a very specific niche and hence, can find it hard to sustain in a more dynamic market.
Cost Is Something You Really Need To Consider
It doesn’t take long to figure out that India is a very cost-sensitive market. For instance, a typical mid-market deal in the US would be equal to or greater than a large enterprise deal in India.
So, when selling to a global customer base, it is important to keep tabs on pricing. What we charge in the United States cannot be replicated as such in India just because we are selling a product with polished, top-notch features. Indian enterprises have their own way of working around things and cost is something that they are very particular about.
All this boils down to having an adaptable pricing strategy. As a founder, I’ve had to be sensitive to our markets, and adopt different pricing plans for different markets taking these sensitivities into consideration. The one-size-fits-all approach doesn’t necessarily work in this case.
Don’t Build A Product And Then Sell Services
It does a startup no good when its sales team promises the moon to large enterprise clients. Enterprise deals innately hang by a thread and when startups aren’t able to meet a client’s request (something they promised earlier during a sales meeting), chances are that the deal will collapse. Not only that but it could hit your reputation quite hard and raise questions about the company’s sanctity.
This is a major issue with a lot of product startups in India. It sure is enticing to nod your head to everything and then later figure out a way to get it done. But that isn’t how product startups are meant to work!
As a founder, I’m obliged to tell my sales team that they are selling a specific product and not a bunch of services. Every sales person should be aware of the sanctity of the product and they must articulate this clearly to clients during the sales cycle itself. What this does is that it helps set very clear expectations with the client and nurtures a healthy relationship going forward.
Thinking and acting big is the minimal criteria to build for enterprises. This underlying attitude facilitates startups to close deals in competitive markets and ultimately create a sustainable and profit-making business model. Ever heard of billion dollar companies? Well, that’s what they do time and again.
Remember, sales solves all problems.