Back in late 2019, I quit my job at InMobi to start up on my own. In the 5 months since, I explored two ideas, and eventually decided to not pursue any of them.
There is a lot to learn from every failed attempt. And I learnt a lot too. I learnt a lot more about myself, people, the fundraising ecosystem.
This post though is specifically about some things I learnt about go-to-market.
1. Go-to-market > Product
This may be a controversial statement for some, I would pick this as my single biggest learning.
To those curious, I am defining GTM as basically the shortest paths (note : plural) to your market.
GTM – or rather – the feasibility of your GTM strategy needs to be figured out sooner than later. Here’s why.
Think of your startup. As it grows, it will change nature. It will be extremely agile in the beginning, less nimble as it grows, and then finally (hopefully) when it has become a big company, it will slow down.
In a similar way, your product will first tend to attract innovators and early adopters. Then the early majority. Then the late majority and the laggards.
All of these customer subsegments have different characteristics. Do you know what’s another name for customer segments? Markets.
As such, there will most likely be a different GTM as your company traverses the path from selling to early adopters to the early majority to the late majority.
And so, successful GTM is sequential. Question your GTM assumptions.
Will they work for the innovators and early adopters today? What growth channels do you think will work? What positioning will work for them?
This is a question you will face as you move from one market to another (whether it’s the type of customer, or geography, or any other dimension).
The key is always – figure out your GTM for your next market.
2. Aligning value propositions
It is not uncommon to face situations (more so in B2B software) where the user and customer are two different personas in the organization.
You have to sort out your value propositions for both users and customers.
In fact, the more complex the product being sold, the more democratic the sales process becomes in a B2B setting.
Related functions, or sometimes even in-house tech teams, will be required to sign off on many purchases.
Are you able to identify all the personas involved in the decision-making? Are you able to map the value prop for all these personas involved?
I should clarify that you are not expected to have multiple value props. There can be a central value prop or two – the ones most important to the customer. But if there are several stakeholders involved, what are the supporting value props? How are you handling objections from stakeholders in the purchase process? Have a solid appendix slide for this.
3. Don’t think of competing on price when selling to enterprises
It is not possible to compete with incumbents on price unless you have really invented breakthrough tech.
Unless you are going to be able to offer something better for 1/10th of a price, something that revolutionary, you would have no chance as a startup selling to enterprises.
In fact, even if you think you can compete on pricing – reverse calculate the operational expenses. Will you be able to make the unit economics work?
Have you accurately considered all the Sales & Marketing expenses? Infra expenses? Additional hires to either build the product or for customer support?
You are more than likely to underestimate these expenses. And that is a source of your confidence in being able to turn around a better-than-competitor product at half the price or something like that. Recalculate your costs. Be realistic.
If Azure can undercut AWS on pricing, you have no chance to compete with elephants on pricing. Figure out a better differentiator.
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