Subtle Nuances of Early-Stage Startup Sales

Jan 25

Written By Jen Abel

Here are a few of my favorites. Please note these are quick and dirty scratch notes …

1. It’s easier for a B2B startup to move up-market than down-market.

easier to add value than strip value. i.e., more functionality, more services, etc.
moving down-market — many Founders underestimate:
- challenge to transition from high-touch value into ‘productized’ value
- incentives, exciting team to pay attention to smaller, transactional deals
- shift in customer expectations, increase in complaints and faster churn when buyer and user converge
inverse is true for B2C — it’s far easier to move down-market than up-market — social signaling is powerful leverage

2. When selling in a crowded market, you must sell the secondary need.

crowded markets almost always have well-entrenched incumbents servicing the primary, well-known need — it’s nearly impossible to sell to this same value and capture the market’s attention — you will need unique positioning to avoid market fatigue by going 1-2 layers deeper from the primary need to unlock secondary and tertiary
a ‘secondary need’ forces you to find a niche — niches are likely a low-risk entry point, as they are far more contained than the wide, well-known 'primary need — note: most businesses don’t simply 'rip and replace' major solutions, as breaking integrations and/or losing momentum is highly feared

3. Many of today’s largest startups were predicated on a business model insight VERSUS technical insight.

barriers to technology have decreased dramatically; everyone has access — or shortly will (open-source, low-code, AI, etc.)
business model insight = unique customer/positioning insight — this is where many ‘unfair advantages’ live today by understanding customers better than anyone else
unlocking opportunities by finding: new ways to engage/package/position value, new space where it’s uneconomical for incumbents to play, etc.

4. Pricing doesn’t matter pre-product/market fit - as long as it is in the strike zone.

there’s enough to try and nail; this one can wait
true pricing is predicated on (1) ROI and value received, (2) social proof, and (3) alternatives available (in that order) — you won’t capture that information accurately until ~1-2 years of serving the market.
many over-index on engineering pricing very early on when, in reality, there’s a rough ballpark folks are accustomed to re: land/first engagement with a startup

5. You can be further away from product/market fit up-market than down-market.

enterprises require robust services, which in turn unlock value beyond the product itself
when selling up-market, your buyer is not your user (these two roles diverge greatly) — the product can be further away from ‘perfect’ — not to mention, the buyer most likely won’t demo – they’ll delegate
enterprises have slower churn - they will give you time to get it right before opting out, unlike a user with (almost) immediate opt-out

BONUS: Some of the best sales talent I know come from non-traditional sales backgrounds

did not start their career in sales — don’t just see the world as ‘selling’ OR accrued bad habits from last few years
never took a sales course or read common books that commoditize them
some even have first-hand experience on the buy side (typically champion)
some of the best sales talent were former: product-side roles (designers, engineers, etc), consultants, analysts, researchers, Founders, etc.
you do not have to focus on recruiting the ‘stereotype’; in fact, the more they feel like a ‘salesperson’ the more you should run — the best in sales make customer feel like they’re buying VS being sold to

Small Business/Mid-Market is NOT Easier Than Enterprise