Techstars Boston Week 3 - Sales are King

If you haven't read any Techstars posts yet, start with my summary of Techstars Week 1. This was another Mentor Madness week at Techstars, and while the pace picked up even further both in terms of number of sessions and mentors, the productivity in the sessions improved even more.  A combination of better mentors and a better understanding on both sides of how to make the most of the sessions made this possible.  And for those of us sitting in on the meetings, there was even more to be learned - particularly on the subject of sales, and why you should have them.

"I'd rather sell something I have to build, than build something I have to sell"

...was my favorite quote of the week.  And it summarized the sentiment of many of the mentors; get out and sell!  Not that teams aren't doing it already.  But as one mentor pointedly asked, "Are you a product founder or a sales founder?"; the answer, more often than not, was product founder.  But in my opinion, the sales founder (or manager) is critical, and will more often than not determine the outcome of the company in the early stages more than the product founder.

On more than one occasion, when the root of an issue, problem or roadblock was reached, the result was founders realizing they don't need to build the next feature, or refine the product, or build the sales team, or anything else, besides actually selling.

Big Teams Help Early Sales in Techstars

More often than not, those teams which are doing the most selling are those who are larger.  The bigger teams (10-16 people) have personnel who are dedicated to selling, and don't have to be involved in the day-to-day operations of Techstars, including Mentor Madness meetings, and the result is that they are selling full-time.  Smaller teams struggle to find the time and resources to get all the tasks done they would like, and sales often suffers as a result.  Even within these teams, mentors often felt that sales should be a higher priority, and while it sometimes may be a time-consuming or frustrating process (meetings, calls, emails, etc. don't always feel productive), ultimately sales are the strongest metric and validation of your product or idea, and key to ongoing success in the business.

(Caveat: often larger teams are large because they've figured out selling.)

Generally, this week, the advantages of having a great salesperson, or people within the team dedicated to selling full-time were particularly noticeable. If you can build a larger founding group, or at least one that has one completely sales-dedicated person, it will pay off down the road.  Alternatively, some of the teams here have realized that the CEO/founder(s) is not a strong sales person, have brought in dedicated salespeople, and have quickly seen the rewards.

Asking Questions is an Art

And yet, it's also so simple.  One of my favorite sessions this week was a lesson in just how easy - yet rare - it is to ask great, in depth questions.  Mostly, it just revolves around asking "Why?", way more times that you think is appropriate.  "What are you doing on the sales front?"..."We're focusing on building the product and relationship with our first big client"..."Why?"..."They're a big client, and there's big potential with them in the future"..."Are you developing your old product still?"..."Yes"..."Why?"..."We don't want to leave our old clients"..."Why not focus on your current product and client, and closing more sales with people like them"..."Uh...I don't know"..."Why?"..."We just wanted to make sure we nail it with this client"..."So why not sell others in the meantime and roll out the product to them too"..."Um...yeah. That sounds good."

A long example, but the result is clear - asking "Why?" (and slight variations of it), even when it's uncomfortable for those across from you, will often lead to some self-reflection or realizations that would not have come if the first answer is accepted.  I was surprised (and to some extent amused) during these sessions, at just how powerful this can be.

Interestingly, this tactic is often quoted in classics like How to Win Friends and Influence People as a tactic to be a great conversationalist - just keep asking "Why?", and push the other person to elaborate.  Eventually some very interesting things will probably surface.

Founder Stories: Varied Backgrounds, Testing Ideas, and the Infinite Wisdom of Sailing

Founder Stories are quickly becoming one of the highlights of my week, and not just because there's free food and beer involved.  This week several founders spoke, and I was once again reminded at just how varied the backgrounds of entrepreneurs in general, and particularly those here, are.  Multiple languages, countries, childhoods, educations, and more were highlighted, and while these are very different people in general, there are many similarities in the way they run companies, the questions they have, and their reason for being entrepreneurs.

Obviously the uniting factor between them is their passion for building great companies, but from my perspective, it just highlighted how valuable varied experiences and backgrounds can be in building your company, in a program like this, and in building your peer group as an entrepreneur in general.

As a sidenote, one of the founders told a story about their time sailing, and a particularly harrowing experience that taught them a larger life lesson.  As an avid sailor and enthusiast of all things water-related, I could relate particularly well, but I also found it amusing at how many metaphors sailing can provide, and on a larger level, the value of participating in individual sports, sport in general, and being put in stressful situations.  But those things will have to be saved for another post. And of course the story also made me want to go sailing.

The stories this week also gave some insight into where great startup ideas come from.  There were people who stumbled into their startup, others who tried something they deemed crazy at the time, and others still who built previous experience in a field in building their company.

The lessons from these stories can be summarized as follows:

  • Start small and test your idea - crowdfunding, a short trial with little to lose, get a paying customer, etc. - whatever you do, find a way to test it at little risk to yourself.
  • If you figure out you're onto something, be aggressive; once the test is done, don't forget to keep pushing.
  • Surround yourself with great people: most of the startup ideas had some element of support from others - whether it be friends who will encourage you instead of discourage, family who will chip in a few thousand because they believe in you, or a partner who encourages you to take some time off work and test your idea - surrounding yourself with the right people can make all the difference.

It's easy to see the learning of teams beginning to accelerate, with more productive mentor sessions and large projects being undertaken by many companies.  KPIs and metrics are beginning to become a larger focus, and it should be exciting to see the growth focus begin to become central.

The summary from this week:

  1. ALWAYS SELL - selling makes (most) everything better.
  2. Having a team to which you can delegate can keep your momentum and pace high - consider when building your initial team.
  3. Asking great questions, and having great conversations, is often just a matter of asking "Why?" a few more times than feels comfortable.
  4. Don't forget to find out about fellow entrepreneurs, and surround yourself with great people.
  5. Always go sailing whenever possible.
  6. In the beginning: test your idea, sell first, and surround yourself with great people (do I need to say this again?).

Check out the learnings from Techstars Week 4 here.

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