
Why Startups Need to Focus on Sales, Not Marketing - sama
http://blogs.wsj.com/accelerators/2014/06/03/jessica-livingston-why-startups-need-to-focus-on-sales-not-marketing/
======
paul
Exposing yourself to the direct, harsh feedback of the market is key. I've
noticed that bad founders will do just about anything to avoid this. Instead
of selling, which is hard, they spend their time going to conferences and
meetups, trying to do PR, talking to biz dev people about partnerships, etc.
It all sounds like work, but mainly serves to insulate them from the harsh
reality that nobody wants their product.

~~~
tptacek
When I said yesterday in a thread about Perfect Audience (which just sold for
25.5MM) that Brad Flora was my working definition of "hustle", and someone
asked me what I meant --- this is exactly what I meant. He would describe what
he was doing to move sales processes forward in Chicago and I would react by
_wincing_ , and then amazement.

This is also why one of the most powerful bits of advice I've ever picked up
from HN is Paul Graham's (paraphrased) "if nobody makes fun of your crappy
product when you launch it, you waited too long to launch". For a lot of
developers, the resistance to sales shows itself in a strong feeling that the
product isn't done, isn't ready. The Steve Blank process is a pretty good
antidote to this.

Also: startup hipsters and MBA types will talk down cold-calling, but I have a
friend hustling a pretty complicated product right now and I have watched him
make cold calls work. Again: _wince_ , then jaw drop. Then learn.

~~~
yogi123
What's the reason for the gratuitous insult to people with an mba? It's quite
a prevalent theme on HN. I'm an mba, and it's an offensive stereotype. I've
noticed over the years that it's one of the more common strawmen that
commenters like to use on HN. I did an mba at Harvard many years ago, and I
would suggest that the level of entrepreneurial hustle among a typical cohort
is far higher than that in a typical engineering program. It doesn't take much
googling to find lists of mba's who've founded prominent companies in the
valley or elsewhere. Anyone doing that would discover that your slam is
nothing more than ignorance or just plain bias for whatever reason.

~~~
bitL
I guess the perception is that MBAs are trained to become a part of an already
established traditional business and not a ground-breaking start up, their
skills are specifically trained to support the current form of corporations.
This notion is supported by entrepreneurship courses from people like Steve
Blank. Moreover, MBAs are perceived as being unable to grasp the technological
advancement, "getting in the way" of technology and insisting on leading
because they have such a degree and not because of their real-world skills
(and often insisting on non-sensical and "trendy" priorities), and this
sentiment is pretty common amongst typical techies.

~~~
jonnathanson
That perception is not entirely without merit, but it's a little dated. Steve
Blank, fwiw, teaches and lectures at the MBA programs at both Stanford and
Berkeley. MBA programs, like those and many others, are actively embracing his
methodology, and methodologies like his.

Modern, top-tier MBA programs are increasingly driven by entrepreneurship, and
less by traditional, hidebound business courses and corporate line-management
skills. A lot has changed, and much of it changed in reaction to the
embarrassments of the late '90s. Furthermore, engineers make up an
increasingly large percentage of MBA cohorts these days; the old MBA/engineer
dichotomy could use a refresh. The two skill sets -- engineering and
analytical business strategy -- are often quite complementary. MBA programs
have recognized as much, and today, being an engineer is a serious advantage
in an MBA curriculum.

That's not to say you won't find your fair share of entitled, naive, or
opportunistic MBA students in any given program. They're still around. But
their numbers are dwindling, because many industries (finance and consulting
notwithstanding) have realized they don't want that type. In time, these
people will become the exceptions, and not the rule. That may already be the
case at many MBA programs.

I'm not here to play apologist for the reputation MBAs have earned in the tech
world. A lot of it has been deserved. At the same time, a lot of it is no
longer as fair or accurate an assessment as it once was.

------
hkmurakami
"All too often, I’ve seen founders build some initially mediocre product,
announce it to the world, find that users never show up, and not know what to
do next. As well as not getting any users, the startup never gets the feedback
it needs to improve the product."

Ah, the Hollywood launch...
([http://gettingreal.37signals.com/ch13_Hollywood_Launch.php](http://gettingreal.37signals.com/ch13_Hollywood_Launch.php))

~~~
gk1
Didn't know it had a term. I made a little comic about this:
[http://www.gkogan.co/blog/simple-user-acquisition-
comic/](http://www.gkogan.co/blog/simple-user-acquisition-comic/)

~~~
soneca
Nice comic, but i don't believe a website is the most important part of the
conversion.

At least for the first users, you should convert them yourself, making them
want to buy/use your product even before they visit your website. This way you
have face-to-face conversation and feedback. This way you will learn about
strategies to sell that work. This way you don't go nuts on AB tests e SEO
optimization when you only hundreds of random visitors.

~~~
infinitone
When you say you should convert them yourself- through what medium if not a
website? Email? Cold calling?

For example, if i'm about to launch a B2B SaaS app for small businesses- whats
the best medium to use for the first customers?

~~~
simonw
In my experience, in-person meetings are by far the most effective way of
getting your first customers. Video calls with screen sharing (for demos) are
the next best thing.

------
KeenanSteel
Maybe the HN crowd has a different view of marketing than I do. Our marketing
team relies pretty heavily on getting user feedback. We'll listen to
individual calls to make sure the site answers questions potential customers
have. We'll run surveys and over the shoulder tests to understand intent,
concerns, and confusion.

My background is in marketing, and I'm confused by this parody of a marketer
who doesn't know how to gather and apply user feedback to the product and
site.

~~~
gk1
(Another marketer here.)

From my experience, the HN crowd knows better. The author is just painting
this a black-and-white issue (either you're doing completely oblivious and
vague marketing, or you're doing nitty-gritty hardcore sales!). Of course,
this doesn't at all reflect what companies are _actually_ doing.

If the gist of the article is "speak more with your users," then I strongly
agree with that. If it's "marketing is useless for startups," well that's
simply wrong.

------
quaffapint
I made a huge mistake with the saas listed in my profile.

I threw up a poll on my existing site, some people said, yes, they would like
a hosted saas version. I then spent 6 months making it - without speaking to
anyone further. It's now been 6 months since launch and its just cobwebs.

Speak to people first! Don't waste 6 months or more just doing the 'easy' tech
stuff. Found out now that no one actually would be willing to pay for it.

~~~
Major_Grooves
but have you actually phoned up any of those people and tried to persuade them
to use it? If you've just validated the idea with a poll, then thrown it up
waiting for them to use it you may have a long wait. I bet you can persuade
some of them to use it if you literally hold their hand all the way.

I'm discovering the joys of fast screen-sharing for demos. (I use join.me).

------
libertine
Something doesn't add up to me: either we lost de definition of Marketing, or
Markteers that start-ups get are not doing their job.

Marketing is the way to get sales. We measure the success of Markteting by
sales. It's the whole purpous of it. If the focus on Marketing is not being
reflected on sales, then their Marketing Plan is not working. I think it's as
simple as that.

The broadness of the audience is irrelevant when it's clear what is the target
for your product - everything outside the target shouldn't count.

It all comes to the hold saying: if you want to please all, you end up not
pleasing anyone.

~~~
3am
You have a brand new account, but you also have the most insightful comment on
this thread which (no offense) is kind of sad.

If a founder doesn't understand the sales funnel and how marketing integrates
with that approach, then they are not being mentored properly. If they are
doing marketing spending without measuring the conversion rate, they're
probably tossing money out the window.

------
Macsenour
I was at a board game convention, as a venue to launch my site
gamerustlers.com, and although we got great reactions, what I really cared
about was how many people walked up to the kiosk and actually signed up. The
second metric was how many signed up on their phones. While in Beta the site
is free so I can't call them "sales", but there is a HUGE difference between
someone saying "Hey, great idea" and that person actually signing up, even
when it's free to do so.

~~~
xgarland
And I believe there is also a huge difference between someone signing up for
your product and someone actively using it after signing up. In my experience,
I found that many people will sign up for a product out of general interest,
but won't do much beyond that stage.

~~~
Macsenour
I agree. Signing up for free, then actually using, THEN using it when it has a
fee. All of those are additional levels.

------
Noxchi
Marketing is salesmanship in media.

If you do marketing first, you're putting the cart before the horse.

You should do sales manually first before you try to automate it away with
marketing, because the feedback you get will give you extreme leverage in your
marketing later.

------
mandeepj
[http://www.janjuaclothing.com/](http://www.janjuaclothing.com/) \- This is my
start up for selling women's designer clothing.

I tried lot of things to get the word out like facebook marketing, adwords,
email marketing, exhibition, brochure distribution, regular updates on
facebook page, deals having upto 30% discounts, spying on twitter for
competitors and their customers to see what kind of conversations they are
having and what they are doing, regular updates to website for look and feel
as well as making it faster and faster.

I reached few affiliates but they were asking for upfront money so I stayed
away.

The site was launched about 9 months ago and I have zero sales so far, that is
making me sad and sometimes I lose my moral as you can see I have done lot of
work. Spent countless hours during day and night. I am not sure what I am
missing.

Next things I have planned to do are - SEO, print advertising.

Any help that would result in sales would be greatly appreciated.

~~~
emmett
Don't bother with SEO or print advertising.

Go find some actual people and convince them, yourself and in person, to try
the site. Watch them try it. Ask them if they want to buy. If not why not.
Expose yourself to that direct feedback.

~~~
mandeepj
This sounds great. Thanks for your input

------
pushkargaikwad
I am running a one man bootstrapped startup (I prefer to call it a business
then a startup) inBoundio, which is a marketing software and for me, having 1
paying customer is more important than 100 users. I get paying customers
through sales, users through marketing.

For Startups, Effective sales will make your marketing better.

------
rtx
I am shocked at how many people have proclaimed that using the telephone to
source opportunities is dead. We have proven this model to be extremely
successful, and have tied incentives to ensure that we are promoting the right
behavior. For instance, we reward our inside sales team for setting up
qualified appointments and provide an additional bonus if their appointments
turn into closed deals. Lists on the internet are in abundance, and should be
leveraged to their fullest capacity. In my experience, if you are calling a
prospect with genuine intent to uncover whether a problem or pain exists, and
are respectful and intelligent in your dialog, you will uncover great
opportunities at every turn. We try to help start-ups by providing the initial
lead at SalesZip.com

------
mathattack
This is so unbelievably true. I worked at a firm where the opposite was true.
The VP of Marketing spent a lot of time inviting himself to existing customer
meetings, wasting exec time on magic quadrants, and hiring his buddies to do
marketing collateral. Inevitably every hour of their time took up four of
executive, sales and developer time. It was impossible to point to even one
sale that they influence. This could also be due to their incompetence, rather
than a general condemnation of the topic.

------
ironchef
I disagree; however, I think it may be because of her definition of marketing.
She states "Sales and marketing are two ends of a continuum." Marketing is
creating, delivering, and communicating value to your users / customers.
Startups need to do both. Well. You need to create a product that gives value
to customers (whether that be through elimination of pain or creation of new
value) and get it into their hands. That involves both sales and marketing.

~~~
porter
That's corporate marketing, not startup marketing.

------
fivedogit
In my three previous businesses, I hustled and cold-called my way to paying
customers (or at least valuable pilot programs) each time. But these were
enterprise (B2B) businesses that could cut relatively large monthly checks.
The reward was absolutely worth the lift.

That said, I'm having a hard time making the leap that for some consumer
internet products with hefty cold-start issues cold calling is still a viable
strategy.

For a product that has no network effect and is useful for the first user
(e.g. Google search), sure, I'll buy it. For a product that needs 10+ people
to start getting useful (e.g. Facebook), sure.

But for a product that needs multiple thousands of users to start getting
useful, how does cold calling still make sense? These 1x1 users would come to
your product, say "Um, it's a ghost town.", and then leave, never to return.
Wouldn't the founders be better off putting effort into PR (TC, Pando, etc)?

TLDR. I'm not arguing that non-scaling hustle is not important -- I've seen
the results myself, first hand. But doesn't the type of product really dictate
how effective it will be, and therefore, how strongly should be prioritized
over other avenues?

------
thinkerer
Im currently working on a start-up and can relate to this. The truth always
hurts and people worry that their dreams will be dashed or the need to correct
things early on which is most times, tremendous hard work (But it becomes
crazy amount of effort if the change is much later on).

I targeted a low price, sales-free model, until i realized cost is not the key
issue, getting feedback is! Hearing what people want and need is crucial! Its
the reason why small firms are more nimble, simply because they move fast and
are able to change rapidly from the feedbacks they received. Also important is
that through talking, I noticed many times, people not only like to share
painful experiences, they kind of impart their "ideal state" solution to you
which can be incredibly helpful from a different perspective standpoint as
well as a imaginative point.

In fact, I would rather spend more time talking to people in person (which I
am doing now) than to rub shoulders and network. Its like delayed
gratification. Have incredible amount of pain upfront so there will be less
(much less) hiccups later on in development.

------
angrymouse
"How should you measure if your manual efforts are effective? Focus on growth
rate rather than absolute numbers. Then you won’t be dismayed if the absolute
numbers are small at first. If you have 20 users, you only need two more this
week to grow 10%. And while two users is a small number for most products, 10%
a week is a great growth rate. If you keep growing at 10% a week, the absolute
numbers will eventually become impressive."

Doesn't the 10% growth (but actually just 2 more users) thing sound like
vanity metrics? I don't see how 2 more users is that great by making it seem
bigger?

Better than nothing, better than non-paying users maybe but it reminds me of a
Publishing company i used to work for who once internally touted their 100%
rise in video revenue (ignoring the fact they had 5 or 6 times the amount of
products released at the beginning of that month and had no video product with
a projected profitable lifecycle).

Covering user acquisition in unneeded and transparent vanity metrics seems to
me to be unnecessary, especially when you are asking customers for brutal
reality.

~~~
nostrademons
Because then next week you go out, shoot for another 10% growth, and get
another 2 users. The following week, you go out, shoot for 10% growth, and get
3 more users. And so on.

The point is to set some concrete, measurable goal for the week so that you
know you're always making forward progress. I had a boss once that told me the
point of Agile & 2-week iterations isn't to be optimally efficient or to do
progress reports for the hell of it, it's to make sure you're always
progressing forwards in a well-defined direction. The biggest risk for a
project or startup isn't really moving too slowly (unless you're moving
_really_ slowly), it's going around in circles.

------
jeremypotvin
Great article and great advice. I do this every single day. Acquire one
customer at a time, work with them patiently, learn from our interactions, and
continue to build a better product. We acquire new customers through
referrals, Google, and traditional sales. A very important part of the sales
process is nurturing them through the trial period - get them to paid no
matter what. If you aren't doing one on one sales and working with your
customers you will never figure out what the "what" is and you will never be
able to replicate it with technology.

I know I have 30 days to impress and win a new customer and convert them. The
most useful tool that I have to help me with this is intercom.io. Their
automated time and event based messaging can interact at key moments when I
can't always be there. Any time they need me, I am one click away. It is a
fantastic platform.

------
cjf4
All small businesses need to focus on sales. Sales gets you cash, sales lets
you talk to your customer, sales is king.

------
kelvin0
Being able to cope with 'rejection' on an ongoing basis makes you much
stronger in many areas of life. From finding a mate all the way to gathering
sales for your product.

Rejection should not be taken personally most of the time, it is just a signal
that you should interpret as your 'hustle' needs refining...

------
csdreamer7
Would anyone be interested in purchasing software that allows you to secure
wipe your phone or Linux laptop remotely?

Yes you can secure wipe your phone, but that's tied to the user account. What
if you wanted to secure wipe data on the phones or laptops you give you to
employees (esp. less technical capable people that lose their phones)?

I noticed that most options only allow encryption and are Windows only.
However since most developers us private source control (and BT Sync), your
likely not going to lose much work. I know I would feel better if my data was
deleted.

What do you think? Give me some of that direct, harsh feedback?

------
mikeknoop
The interesting thing to me is how quickly you transition from Sales oriented
-> Marketing oriented if things are going well. Early product/market fit can
act as a bit of a guide for when to do the transition.

~~~
mrkurt
Yes. And how painful it is if you wait too long to transition.

------
aashaykumar92
Great article, but I have a situational question: Let's say a company has
grown at a 10% weekly growth rate and is now at 500 users. But as they try to
sell to more people, they realize they are no longer growing at 10% and their
growth rate is stagnant or decreasing WOW. Does it make sense to continue
trying to sell OR focusing on user feedback and improving the product? I
assume 'both' will be a popular answer but why? If you know your product is
currently subpar, why not just build until the next iteration is ready and
then start selling again?

~~~
diziet
500 what? Free users? Paying users? Paying what, $5/month? $500 / month?
$200,000 / year?

~~~
infinitone
Building on his example (cause i'm in a similar situation), lets say its
paying users at $60/month.

------
cmapes
Startups selling a business product need to focus on a salesforce, direct
marketing methods that are profitable, and getting in front of real paying
customers.

But startups producing social media products, or consumer applications that
are freemium or passively monetized will not benefit with sales. They need
marketing via PR, social media, or viral mechanisms baked in early on into the
app.

Let's not overgeneralize.

------
esamek
But you also don't want to focus just on sales.

In the end, every business model will have a more optimal and less optimal
emphasis on sales, marketing, user feedback, etc...

Most B2B and B2C startups may in fact need more focus on sales...but a B2B2C
company may find it misleading. If your customer is not your end user,
focusing on sales and not marketing can actually be quite dangerous.

------
klunger
This was a great article. I just wanted to add the logical extension: the need
to be flexible and a willingness to "pivot." The process of getting your
product out there manually can give really focused user feedback that will
help to refine the product in a smart way. Painful at first, yes, but
ultimately very valuable.

------
logicallee
"why startups need to focus on cash collection (accounts receivable), not
sales."

~~~
rlucas
"why startups need to focus on comprehensive changes in owner's equity, not
net income"

------
safun
If you study your target audience properly and with the right tools to analyze
data, you can market narrow and deep. Sales should be #1 priority, I agree, so
you can continue to collect feedback and make product iterations but saying
marketing is broad and shallow is an incorrect statement. Digital marketing
tools have evolved in the past few years and it's a lot easier to measure
success on specific tactics. I think the old school mentality of marketing is
"spray and prey" and if that is what one's thinking of marketing is, then they
are not doing marketing correctly. The job of the marketer is to make the life
of the sales person much easier so that the conversations they are having are
meaningful and have greater chance for conversion.

------
Georgess
I guess it depends on a startup. You can't just go to the street and try
selling your product(well you can) but you need to identify potential
customers which is marketing..

------
kirkus
It's all about hustle and how startups are different to big companies. Every
startup CEO should be talking to customers every single day.

------
kamilszybalski
"At Y Combinator, we advise most startups to begin by seeking out some core
group of early adopters and then engaging with individual users to convince
them to sign up." Sounds like marketing and user acquisition to me...

~~~
gsharma
I think the article's message is same as "Do things that don't scale".
Marketing is something used to get users in large volumes (certain groups) vs
sales is more of a one-on-one approach. Once you have figured out what works
in these one-on-one sessions, you take that message and scale it up as your
marketing message.

------
polymath88
I thought they went hand & hand, no?

------
dschiptsov
Focus on sales? Does it mean "selling crap to crappy people" and other "sales
techniques" as seen on The Wolf of Wall Street?)

~~~
simonw
Not in the slightest. When a product is new it doesn't matter how great it is
if there's no one finding the right customers for it and helping them
understand why it's right for them.

~~~
dschiptsov
In case of a _normal_ , fair product customers usually need no help, they
could figure everything out even better than "sales professionals" because
they are using/consuming similar products, like with a "fair" booze or a fresh
meat.)

------
spiritplumber
I'd rather startups focus on delvering what they promise.

------
corwinstephen
Even though I agree, this is a combination of baseless speculation and
pontification which I find to be obnoxious.

