
How to sell a B2B product - polote
https://calv.info/how-to-sell-b2b
======
ThePhysicist
A rule I gave myself after running a company for several years is that I never
reply to incoming offers or sales pitches. In my opinion it’s very rare that
someone really offers something that my company needs at that exact moment, so
most interactions resulting from such offers will be a waste of my time. In
the past I reacted to such incoming offers, but I always regretted it and
usually burned some money and time as well. Now they only way I pick suppliers
is by sourcing them myself exactly when I need something.

I think many executives / entrepreneurs have developed a similar adversity
towards incoming offers, and my own experience with cold outbound selling
seems to confirm this. I’ve contacted hundreds of companies myself trying to
sell our service, but the only deals we closed so far were either with
companies we already knew via our network or ones that did actively seek out
our services themselves. It’s of course possible that an experienced sales
person would be able to generate outbound interest, but as a founder without
much sales experience it is very tough. I therefore think inbound sales is the
future, at least in B2B.

~~~
goatherders
Well said, and I appreciate your perspective.

I also 100% disagree.

Inbound is a waiting game. Referrals are a waiting game. And hoping to be
found at the right time by the right buyers ENOUGH times puts external
factorsnin charge of your business but just thriving, but surviving.

My business exists precisely because we believe so strongly in outbound as a
strategy. But wherein you are right that random cold outreach is distracting
and a waste of time, outbounding that is targeted well and focused on problem
solving can be the best ROI you have all year.

The difference, we have found, is between prospects who are aware their
businesses are imperfect AND are curious about solving problems and prospects
who know their businesses are imperfect and willing to live with those
imperfections until such time they become intolerable. Those that choose the
status quo until such time that they choose to go looking, as you have self-
identified.

Candidly, there are a lot more of the latter than former but there are still
plenty of the former.

~~~
ThePhysicist
Maybe I just didn’t get any good inbound requests so far then. We’re a small
startup so I think we don’t attract a lot of outbound interest, this might be
different for larger companies of course. Taking time to learn about the
specific interests and needs of a small startup with little budget is probably
overkill, so we just get the “spray and pray” treatment I guess.

Do you have a good strategy for identifying open-minded companies that are
willing to learn about new approaches?

~~~
kristianc
> Taking time to learn about the specific interests and needs of a small
> startup with little budget is probably overkill, so we just get the “spray
> and pray” treatment I guess.

> Do you have a good strategy for identifying open-minded companies that are
> willing to learn about new approaches?

The answer to both your questions is segmentation, segmentation, segmentation.

The trick with segmentation is to find clusters of companies who are likely to
share like-minded problems, hone your messaging and positioning to reach them
(Basecamp is a classic example of how to do this well, they have always had a
very clear idea of who Basecamp is for and who it is not for), and then
identify the _individuals_ within those organizations who are most open to
change.

Again, the temptation is to head straight to the C-suite - this is usually a
bad place to start. C-suites are time poor, usually quite cynical about new
software, and removed from the problems of the people on the front line.
Usually better to start in middle-management with PMs, and arm them to build a
business case to take further up the org.

~~~
snuxoll
Don’t forget to sell to the stakeholders under the management team as well. I
may be just another DevOps guy in my company, but my opinion holds sway in
purchasing decisions even if I don’t control the budget - as do the other lead
devs on the team.

------
aloknnikhil
Thanks for sharing this. For me, this was the biggest takeaway.

> In every case, a viable option for the customer will be to “do nothing”.
> They don’t have to buy your product, or any product for that matter. The
> best way to prove the case for your product is with your metrics. Doing
> nothing should be a very expensive option.

That fundamentally speaks for having a problem to solve and not a solution
looking for a problem. I think this key distinction is a good sieve to filter
out potential ideas especially if you're in the business of SaaS.

~~~
bob33212
In enterprises there are plenty of problems that are just not important enough
to spend money on. For example there may be a yearly reporting process which
takes 30 days for an accountant to complete, which could be automated by a
SaaS product. That is less than $20k a year of cost. The CFO may be perfectly
fine with the manual process. Just because someone could save money with your
product doesn't mean that they will want to.

~~~
yoshyosh
Assuming I'm paying that accountant less than 20k for those 30 days, it
doesn't make much business sense to switch when presented that way. Businesses
don't always optimized for saved time even if it's obvious, it has to make
business sense on an ROI level aka that solution only costs me 2k rather than
the $20K I spent on the accountant. Also like you said they just may have
bigger fish to fry since 20k is nothing compared to their other issues

~~~
JumpCrisscross
> _it has to make business sense on an ROI level aka that solution only costs
> me 2k rather than the $20K I spent on the accountant_

With these numbers, I’d stick with the accountant. They work. They are
flexible. They can be easily replaced.

With a SaaS product, I have to worry about whether their product works, if
they’ll be around in a few years, how they’ll safeguard my data, if they’ll
try to lock me in and increase prices, and if they can adapt to my changing
needs. This decision process, alone, could easily nullify the projected
savings.

------
coderintherye
Having been on both sides of this, I think this is great advice, but misses
something key. If you are selling a relatively high-cost product (>$10k min
spend), then there needs to be some acknowledgement of that up front. It's a
waste of everyone's time if I'm running a startup that can easily spend
$100s/month on a product, but simply have no way to invest tens of thousands
in a product. Whereas, when I'm leading an established company that can easily
afford tens of thousands of dollars, then I care about the value. In short,
know your customer should include, know when your customer is a 2-3 person
seed stage startup and either offer some version of the product at a price
that they can afford and growth into/with you on, or just be upfront that it's
out of range right now. A great example of this would be Looker. Great product
(in my opinion) and provided a ton of value to Kiva, but it's a significant
investment. I'd love to use it at my small startup but the price is out of
range so for now we use Google Data Studio instead. And yet the sales agents
come knocking anyways. Understand your customer, know when something would
provide value they can afford vs. is way out of current range for current
budget/scale.

~~~
polote
Well, in enterprise Saas usually the pricing is not shown on the website
without contacting a sales rep, so it usually eliminates companies which don't
have a lot of money.

But even if a small company is reaching to you, as a salesperson, this is your
job to qualify the lead, and to not loose your time on a lead that has low
chance of signing

~~~
sebslomski
What’s the reasoning behind not putting the prices up? For me that’s always a
huge downer and means „that’s going to be quite expensive“.

~~~
polote
In enterprise sales, the price is not the main decision maker, you will
usually only disclose the price at the end of the sales cycle.

Not showing the price on the website is one way to push people to contact you.
You don't want people to decide on their own if they should buy your product,
you have a big sales team to help them do that.

I've wrote about it here, if you are interested : [https://blog.luap.info/why-
most-saas-companies-cant-be-succe...](https://blog.luap.info/why-most-saas-
companies-cant-be-successful-with-both-enterprise-and-smb-customers.html)

~~~
ramraj07
I just assume if there's no price shown then I (as an individual) cannot
afford it, and it's in the tens of thousands. Seems to have worked accurately
for me when I'm looking for individual-level use.

However when I'm looking at tools that can help my org, I'm definitely
frustrated that there's no pricing mentioned in many offerings - clearly I
have three tabs with three solutions open and I have no idea about the costs.
I'm NOT emailing you because I as an engineer won't have the same interest in
this idea tomorrow when you email me back (probably because tomorrow's Monday
and I'm in sprint planning). These ideas just fizz out and I never get a
chance to follow up because of this

~~~
lmeyerov
Good case study. If it was more burning, you'd email.

Enterprise sales at 100k+/yr levels can take a lot of work by both sides to
get to the finish line, at least until everything else is smooth, screening
out inquiries like this saves everyone time.

An even better business would have a way to make you succeed early as a single
dev with low interest, and grow to enterprise level.

But that is now building 2 products and a fancier business. Hard to do both at
same time, esp. initially. Sometimes you are lucky -- Concept, $$$, etc. --
but probably not.

------
AndrewKemendo
> At the end of the day, selling well means that you are helping the customer
> actually understand their problem, and the path to evaluate a solution.

Lipstick on a pig in 99% of cases.

I've been a CEO, CDO, a consultant, a middle manager and an IC. Well
functioning high output teams (in any sector of business) almost never need a
new tool/service to provide value. On the flip side, poorly functioning teams
are constantly chasing new tools and processes as fixes to their broken
organizations. So the vast majority of sales are convincing broken
organizations to buy organizational nudges.

The single place where I am consistently happy to spend money is on things
that our organization cannot internally build that we need to scale
immediately. In the long run though, I want to eliminate as many outside
dependencies as possible, so my goal is to either absorb you or build
processes and systems that replace your service.

~~~
billyhoffman
I too have had those roles, starting my career as an IC, then a middle
Manager, then a consultant, then a CEO/founder, and now a CTO. What I’ve
focused on is how to help my teams and then my company operate as efficiently
as possible while spending our resources where it benefits our customers the
most.

Some examples of decisions I’ve made:

\- IT/engineers won’t spend time building and maintaining email servers, we’ll
spend $5/month/employee on G Suite and use their time on things that make our
products more valuable

\- We won’t outsource support even though that would dollar for dollar be more
efficient, because understanding and building empathy for the customer is more
important

\- no we won’t spend money on email lists, but yes we will spend money on
tools that allows our outbound sales team to more quickly determine prospects
that fit our ideal customer profile

\- bringing finance in-house much sooner than other people recommended because
being more efficient at Accounts Receivable, Renewals, and thus cash flow
allowed us to grow faster than we otherwise would have

\- paying for a third party SSO solution for our products and instead using
engineering time to build first class integrations between our products and
complementary products, because having an artisanal SSO System doesn’t benefit
our customers

~~~
mikst
> IT/engineers won’t spend time building and maintaining email servers, we’ll
> spend $5/month/employee on G Suite and use their time on things that make
> our products more valuable

In-house email servers are not constrained by the time to build them, but
rather by reputation/spam considerations. Sorry, but that's a lucky guess ;-)

> paying for a third party SSO solution for our products and instead using
> engineering time to build first class integrations between our products and
> complementary products, because having an artisanal SSO System doesn’t
> benefit our customers

That's one of vendorlockiest vendor lock out there, which is a very YOLO
decision.

The idea that buying stuff is more efficient then building it yourself is at
the cornerstone of the modern economic theory, but that's only a theory. In
the wilds there's much, much more factors to consider then just comparing cost
of building versus cost of buying.

~~~
billyhoffman
Of course there are more factors. We are not blindly outsourcing everything to
services and we are equally not blindly building everything in house. Those
factors often come down to core competencies and “best and highest use” of
time. These will vary by company. Case in point: lots of companies use
highcharts and D3 for charting. why? Because building and maintaining a world
class graphing system is not their core business and doesn’t meaningfully
advance their business. And outside of a small minority of companies building
your own charting from Scratch does not provide a meaningful advantage for
your customers or over your competitors.

Deciding what is core and should be in house and what is not is hard and it’s
only partially a technology decision. It’s primarily a business/market
decision and being able to do those is a mark of a good CTO.

------
airnomad
I was on a call with their sales rep and he was awful. Even if I told him what
kind of volume we're looking at, the guy didn't want to talk costs, over two
meetings. Very poor experience. Seems like they're designing pricing around
how much money you have.

------
ricardobeat
As someone who has been on the other side of the table as a buyer, I'm not
particularly fond of this advice. Especially when the customer is the one who
reached out. Time is valuable and it's not feasible to have a close
relationship with every vendor; I'm buying a product because a need has been
identified, your product fits that need. Most likely I am _not_ looking for:

\- consulting

\- running a brainstorming session with a third-party

\- learning something I don't already know about x/y/z

\- sharing sensitive info such as success metrics

Sometimes you really want a hands-off, transactional relationship, where the
partner simply delivers what you paid for, no more, no less. I understand this
approach might be very valuable for a certain kind, or stage, of company, but
it won't be ideal for every enterprise.

------
seneca
Due to person experience, this strikes me as pretty ironic. My company had a
very bad experience with Segment, so much so that we changed product roadmaps
to move away from them. In my mind they're an example of how not to sell a
product. Very much not a company I would want to partner with again.

~~~
calvinfo
Author here. I'm sad to hear this and want to understand how we can do better.

Do you mind following up over email? I'm calvin at segment.

------
thinkingkong
Not sure why the negativity here. This is actually a great post that sets up a
high level framework for thinking about the problem. Regardless of your
personal experiences with Segment its good advice.

------
gk1
I'm late to the comment thread but want to add something based on my seven
years selling and marketing B2B software:

1\. The user is not always the buyer. Many founders know who their users are,
but may not know who really made the yes/no decision. The sales and marketing
need to communicate value to the buyer just as much as (if not more than) to
the user.

2\. Buyers need to be convinced that your product will solve their most
important business needs--their __desired outcomes __. Things such as lowering
overhead or meeting compliance requirements. (Similar idea to "Job to Be
Done.") That’s what your sales and marketing should primarily be about, with
benefits, social proof, and other selling points as backup.

Simple in principle but it takes months of research, customer/prospect
interviews, and experimentation to figure out your buyers' desired outcomes
and how to talk about your product in a way that directly aligns with those.

(Slightly longer version of this:
[https://www.gkogan.co/blog/buyers/.](https://www.gkogan.co/blog/buyers/.))

------
troquerre
Great post from Calvin. Every founder, even if they're the CTO, should learn
at least the basics of selling. Having the whole team aligned on what moves
the needle makes a huge difference. It's not enough to offload thinking about
selling to the CEO just because it's not the CTO's primary responsibility.

~~~
ryanSrich
And if possible this is a great lesson for early employees, up to maybe 50.

Having an engineer or PdM take 1 hour per week to jump on sales calls and just
listen is one of the best things they could be doing early on.

------
panorama
Very helpful post, actually included a lot of interesting tidbits that I
hadn't read before with other b2b sales material.

One question that occasionally pops into my mind is, what is the legality
behind charging BigCo A $x and BigCo B $x + y?

Surely one wouldn't be able to do this with products (I'll sell this burger to
you for $5 but this other person must pay $10 for it), so how is it justified
in b2b especially if the feature sets are the same?

~~~
gbasin
Perfectly legal, afaik. For software, and hamburgers

~~~
aaronchall
That's right - that's how coupons work - price discrimination.
[https://www.investopedia.com/terms/p/price_discrimination.as...](https://www.investopedia.com/terms/p/price_discrimination.asp)

------
jjguy
I frequently recommend [https://openviewpartners.com/blog/founder-led-
selling/](https://openviewpartners.com/blog/founder-led-selling/) as a good
early stage enterprise sales framework. It is addressing a different, but
complementary, set of questions to this post. If you're at a stage to need
this kind of feedback, you should read it too.

------
harrisonjackson
My brother and I cofounded a company together. We're both engineers and by far
the hardest part has been learning sales. We're not full-on nerd stereotype
engineers who can't talk to customers or network but a master's in comp-sci
covers exactly zero sales or marketing.

We finally embraced that we are not going to be the best at sales or "always
be closing" but the things we are really good at are automation,
experimenting, and iterating which has enabled us to talk with more prospects
and slowly improve conversion rates. In non-sales speak that means we have
more customers having more success on our platform which is awesome.

We honestly believe we are offering something powerful to our customers to
change their lives. That belief doesn't put food on the table though and
shameless sales tactics like cold emailing, LinkedIn messaging, Instagram
DMing, etc DO. (though we are super respectful and won't hound anyone that
isn't interested)

I have a friend who works for transamerica selling financial packages and
recruiting other people to transamerica. His ability to talk to anyone
anywhere is constantly amazing and embarrassing.

~~~
goatherders
I think there is some slant against "shameless sales tactics" here because
many HN'ers aren't in a position to recognize exactly how valuable sales is.
There are some well known and well loved "tech companies" that grow to be 90%
sales and marketing and 10% engineering after they put their funding to use.
And for those here that arent familiar, quite often VC money is meant for
growth via sales and marketing, not via hiring more engineers.

What's interesting is that if you do think what you are providing is actually
useful or meaningful, then there is nothing shameless about promoting it
directly to those that might get use from it. And you promote it to people
where they are: in their inbox, DMs, LinkedIn, etc. (We actually get
tremendous results by supplementing cold email with phone simply because
people are so surprised that we went through the trouble to call. But that's a
discussion for another time.)

All that is to say that reaching out to people that might benefit from what
you offer isnt sleazy in the slightest and is a practice as old as time
itself. They will let you know if they arent interested, usually by ignoring
you. Doesnt mean you should stop or feel bad about it.

Best of luck to you.

~~~
ramraj07
How do you find phone numbers and what are some best practices in making
follow up calls?

~~~
goatherders
There are free tools for finding direct dials but the hit 4are us pretty
mediocre - 40 to 60% on average depending on sector.

HQ # are easy to find although navigating phone trees and gatekeepers is a job
unto itself

Zoominfo and a few others are super expensive but have better data.

Google works better than you think. Sales navigator has some numbers.

We usually call when an email has been opened multiple times and get really
good hit rates for demos when we actually reach the person (when talking about
SAAS). Last week one of my guys used that to book demos with Disney, Sony, and
NBC Universal at the VP level to demo enterprise marketing software.

------
nojito
Segment is backed by a ginormous sales operation from its multiple successful
funding rounds.

This article is very fluff heavy and contains almost no actionable insights.

------
abtom
> my #1 rule for this is teach people something they didn’t already know.

You just went full meta

------
xwdv
I wish I could even start a B2B startup, but I have zero experience in any
other industry beyond software, which pretty much limits my possibilities to
just making software tools.

God I wish I had knowledge in more domains.

~~~
thestepafter
Just start, you can read about starting all day long and doubt yourself or you
can start, today. Decide on your first step and complete it, then choose your
next step. You will have sleepless nights and tearful days but once you start,
you learn. You don’t have to have it all figured out or a plan, just start in
the general direction.

------
qnsi
Why is the CTO talking about selling? Dont mean to be harsh just curious

~~~
bgilly
A good CTO is at least involved in the pre-sales process if not the entire
sales process of large deals. Especially when the product being sold was built
by the CTO’s team. That’s been my experience anyways.

~~~
qnsi
Thank you for explaining! Makes a lot of sense

------
nojvek
The biggest change I’ll make in my life after reading this article. I’ll ask
the question “what does success look like?” more often.

------
brenden2
Step 1: Get tons of VC money.

Step 2: Hire a big sales team.

Step 3: Be really good at marketing.

~~~
danieltillett
The process really goes 3, 1, 2.

------
orasis
Beautiful. Thank you.

------
psaux
Know your customer, works well for me. I focus on Fortune 500 at my job, and
people forget to ask what the customer wants and go straight into a sale.
Meta: not sure about this blog, it is in itself a sales page.

~~~
wrnr
A miserable sales page, I still don't know what Segment does, something with
analytics and apis?

~~~
psaux
I have no clue, always magic.

------
raghava
> The infrastructure used to run our Salesforce instance probably costs
> somewhere on the order of $100 per month. Yet, they charge us tens of
> thousands of dollars per month… how?

Not really. Unless the subscription is in tens of hundreds, that benefit-of-
volume is not possible. Even more so when the solution involves bleeding edge
stuff (AI/ML/real-time analytics etc). Easy to say, very very very hard to
even achieve decent margins on such infrastructural cost. It's always a
tradeoff between { feature-richness, time-to-market } and cost-efficient SaaS.
Only the players who got a solid customer base would ever get to enjoy that
privilege.

> Though it’s far down in the acronym, the identified pain is really where you
> should start with the customer. You should be able to answer in great detail
> why their life is currently painful, and how they handle the problems you
> solve today.

There's a slippery slope. Any "solution" won't help, in the era of "disruptive
solutions". During the initial stages of industrial revolution, cities were
scared of all the horseshit they thought they'd have to deal with. A
'con'sultant would've typically come up with an efficient way to dispose off
all that manure into the sea. Only a mad scientist working on an automobile
somewhere ended up solving that poop of a problem really. And in hindsight,
every mildly lucky person would consider themselves "disruptive" without
actually having to be one though. Such is our world! :D

[edit] just noticed that all comments in this thread that are critical of the
narrative are voted down. one is fine, all of them?

~~~
ec109685
The author was talking about the marginal cost of Salesforce running their
instance. If they stopped being a customer, it would save Salesforce $100 in
server costs, but Salesforce would lose $10k’s. That means, Salesforce needs
to deliver that much value to the customer in order to keep them. In addition,
they need to deliver that much value over any lower cost competitors.

~~~
raghava
That's what am saying as well. Such thing works for SFDC. Not for any ordinary
B2B firm that's struggling to gain their 10th/100th customer.

