Edition 18: Top-down or bottom-up sales; Your first ten paying customers; Customer development methodology;

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READS

How today's fastest growing B2B businesses found their first ten customers (Lenny Rachitsky)

1. Only three sourcing strategies account for every B2B company’s very early growth (unlike the seven strategies for consumer apps). Thus, your choices are easy, yet limited.

2. In practice, it’s even easier — almost every B2B business BOTH hits up their personal network AND heads to the places their potential customers were spending time. The question isn’t which of these two routes to pursue, but instead how far your own network will take you before you move on.

3. It’s a huge advantage to have a strong personal network in B2B, which you can also build by bringing on a connector investor or joining an incubator such as YC.

4. Tapping your personal network is even more important if you need to “sell” your product (i.e. not going bottom-up), likely because early customers need to have a reason to trust you.

5. Getting press is rarely the way to get started

The Sales Learning Curve (Sequoia)

The learning in the SLC is an enterprise-wide endeavor (not just the sales department). It includes all customer facing parts of the organization: marketing, sales, product support, product development.

When you launch a new product, don’t just hire an army of salespeople and let them loose once you have your first product release. Think of this as another “development” cycle that the company has to go through.

The result: higher merchantability of the product and, therefore, higher sales yield.

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OPINION: Building a Customer Development Methodology

Let’s assume that most Enterprise start-ups fail due to a lack of customers, not product development then why do so many start-ups have a process to manage product development and no process to manage customer development?

We believe that founders must focus on (paying!) customers and the market from early on => Customer development is as important as product development.

1. Customer Discovery

Stop selling, start listening: there are no facts inside your building, so get outside

Test your hypotheses: problem and product concept

Answer these questions:

• What are your customers’ top problems? How much will they pay to solve them?

• Does your product concept solve them?

• Draw a day in the life of a customer

• Draw the org chart of users & key decision-makers

2. Customer Validation

Develop a repeatable sales process

Only power users are excited enough to buy/pay

Answer these questions:

• Do you have a proven sales roadmap?

• Do you understand the sales cycle?

• Do you have a set of pilots (£££) validating the roadmap?

• Does your financial model make sense?

3. Customer Creation

A few ways:

• Grow customers from a few to many

• Think about markets: existing, segmented or new

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ATTEND

8 November

🇺🇸 NYC: Houck's Founder Meetup

One of our team’s favourite start-up newsletters! Houck is bringing the community IRL for a happy hour in NYC.

🇬🇧 10 November

Techstars Startup Weekend AI London 2023

​Learn how to think, work, and build like a startup in 54 thrilling hours. This hackathon is for anyone who has an idea for an AI product that they haven't built because they don't have the time, technical skills, or team.

💻 16 November

Redefining growth: The evolution of a startup CFO

​When scaling your startup, a CFO is your secret weapon. In a tough-to-raise environment, how are CFOs preparing startups for their next round? Startups have shifted strategic focus from ‘growth at all costs’ to finding a path to profitability — what metrics are CFOs prioritising? How has the CFO strategy changed?

🇪🇸 28 - 29 November

Barcelona Deep Tech Summit

Barcelona will be the epicentre of the Deep Tech scientific and entrepreneurial ecosystem. The meeting place for startups and spin-offs, researchers, investors and corporations to find revolutionary solutions to the most complex global problems.

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LEARN

👀 We are watching Which Sales Strategy is Best for Your Startup? by Y Combinator

The series pits two competing concepts against each other. In this episode, Y Combinator Visiting Group Partner, Pete Koomen, explores two common B2B sales strategies: Top-down and Bottom-Up. Pete helps define each and discusses how a startup should choose and build its sales motion.

📚 And reading the 2024 State of Sales Report by HubSpot

Discover the goals, challenges, and trends in B2B and B2C sales, and learn how sales professionals are reimagining the customer relationship.

Please note that any charts, data, or projections discussed are subject to change without notice, may differ from opinions expressed by others, and are for informational purposes only. They should not be relied upon when making any investment decision. The content speaks only as of the date indicated; Pretiosum Ventures has not independently verified third-party links or sources, nor makes representations about the enduring accuracy of such information.