Selling The Startup
What do you do when you are starting a new business and need sales?
Last week we received this message from Val. He writes:
I discovered your podcast 3 days ago and I’ve listened to over 20 episodes already. I have a question that I hope you will address in one of your podcasts. I’m a math/stats expert working for a large investment bank. Although I’m still employed, work is slower due to the recession. I’ve decided to use this time to try to start my own business building sophisticated statistical models to help businesses improve their marketing. I’m convinced that the first step to starting a business is sales. If I can convince someone to give me a contract, I can build a great product for them and get my business started. The benefit for my first few clients is that they will get my service a relatively low price. What approach should I take to get my first client?
Val, as a person who has started multiple businesses I understand your challenge. Getting your first customers is one of the biggest hurdles your startup will face. Fortunately for you one of my very good friends is Karl Goldfield, The Startup Sales Mentor. Karl makes a living helping folks just like you get those first crucial customers on board and turn those customers into profitable business. I gave Karl a call and this is what he had to say about your question:
Karl Goldfield: Well Jeb, that’s a great question, and one Entrepreneurs ask me all the time. There are really two answers and neither is better than the other. What your listener needs to determine is if they want to have an innovator – a risk taker – pay them for the product, or give a thought leader – or an early adopter – the product for free and create a Customer Evangelist.
The challenge in getting your first customer is that people who are willing to pay for something that has no proof of concept are innovators.
The innovator is usually a person willing to buy things just to be the first, but they have little pull in their industry or sector. Many companies with new ideas will build their client base with these buyers but struggle to break through in the market until an early adopter makes a move and buys what they are selling. While this is a good way to build revenue, I prefer seeking out thought leaders who are always looking for a competitive advantage and making one of them my client for free.
People often question this method as it means giving up time and energy with no fiscal return, but that is not the case. If you can make a thought leader happy and get them to become a Customer Evangelist – one who is willing to talk about your offering – this can save you much more time and money in the long-term.
Jeb: Karl, before I let you go I have one more thing. How should Val go about finding an innovator or an early adopter?
Karl Goldfield: Another great question, and one of the great tricks of the trade. The simple answer is research. Go out and look for startups that are in your industry or market sector. Then find their customer base. These are the innovators and early adopters you want to focus on. The more often you find a reputable company on startup customer lists, the more likely they are the people who will spend for a competitive advantage.
Starting a business is difficult. It requires hard work, dedication, passion, and an unshakable belief in yourself. You have to work long hours, stay focused, and pick yourself up time and again from the inevitable failures. However the rewards can be great. Not just monetary rewards. The more important payback is the feeling you get from seeing your ideas become tangible and your company grow. Val is smart because he is reaching out for help. If you are starting a business I recommend getting a coach or mentor, reading books, and listening to audio programs.
If you want to learn more from Karl Goldfield visit his blog, www.salesblog.karlgoldfield.com or watch his free TV show every Monday Night at 9pm EST at www.tv.salesevangelist.com.
This is Jeb Blount, the Sales Guy. If you have a sales question please send it to salesguy@quickanddirtytips.comcreate new email.
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