Early Stage Founders, raising awareness, and attracting customers are key components of any successful business, but especially for early-stage B2B startups. In order to grow and scale your business, you need to effectively market your products or services to other businesses. Here are five things that early-stage B2B founders must know about sales and marketing:
1. Go-to-market Strategy
Early-stage founders often don’t have a strong understanding of what a go-to-market (GTM) strategy really is.
A GTM strategy is your playbook on who you will sell to, what you will sell to them, and how you will sell it. Who is your Ideal Customer Profile (ICP)? How will you be selling to your ICP? via phone or via outbound emails? Perhaps you will be selling online by driving traffic through ads. Perhaps you will sell through channel partners…What will your message be? How will you enable your ICP to understand WHY they should buy from you vs. someone else?
2. SMB vs. Mid-Market vs. Enterprise
SMBs are small to medium businesses. They typically do < $10M in annual revenues. They can make decisions fast.
Mid-Market: businesses that do $10M-$1B in annual revenues. You will be talking to several stakeholders in the decision process that can broadly be categorized as Influencers, Decision Makers, Blockers, and Buyers. Sales cycles are long but not unreasonable (3-6 months depending on company size).
Enterprise customers: businesses that have $1B+ in annual revenues. Think of big brands like Coca-Cola, Pepsi, Ford, etc. They have extremely slow decision-making processes. Several layers of management will be involved and you will be selling to a committee depending on the size of the deal. The sales cycle could be 6-18 months, maybe even 2-3 years.
A common mistake that B2B founders make is to focus a lot of energy on selling to Enterprise customers because of the brand value. While the brand may be valuable, you might lose months or years in the sales process without winning the deal. In my own journey, I pivoted from enterprise to mid-market and saw sales accelerate rapidly.
3. Sales Cycle
How long does it take a customer from first contact to make a purchase?
For B2B founders this can be a very tricky question. Especially if you’re selling to mid-market/enterprise customers. There might be pilots/trials involved followed by lengthy reviews with multiple layers of management. Assume 1-3 months for SMB, 3-6 months for Mid-Market, and 6-18 months for the enterprise. Factor this timeline into your revenue projections.
4. Pipeline
Once you get ready to sell your product, your most important question is going to be the pipeline. Your pipeline is the cumulative total value of deals in your sales process. Your pipeline should be at least 3x-5x your revenue target.
5. Founder-led Go-To-Market
Early-stage founders need to get comfortable with selling. If you’re a technical founder, I know this can make you uncomfortable. But, if you’re making a product for business customers, do not expect someone else to build your go-to-market engine from scratch.
So if you’re not out there talking to customers and solving their problems then get out there. No salesperson or external agency can explain the product as well as you can. If you’re not good at pitching, then learn.
Here’s an article I wrote on how to communicate effectively, which might help you in your early-stage founder journey.
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