Category

Startups

Why your startup team should always be pitching

By Startups

Originally posted on the IBM Global Entrepreneur Blog on February 5, 2016.

Product. Team. Customers. Funding. The essential elements of a startup. But one more essential piece is missing: Pitch.

The Pitch is arguably the most important non-business piece of your startup. From your elevator pitch, to your public pitch, to your investor pitch, the more successful you are, the more integral these will become to your business and your life. Because of its importance, you should take absolutely every opportunity to pitch, especially in the early stages.

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The first and biggest benefit from the always pitching mindset is practice. Don’t practice until you get it right, practice until you can’t get it wrong, is the modus operandi of true professionals in every walk of life. This needs to be your motto. Living room pitch practice only takes you so far; get out in front of the public and practice your pitch.

Now that you’re out in the public, you’ll benefit from the next most important thing: feedback. The Lean startup methodology is build, measure, learn. When you have built something, whether mockups, a fully functioning product, or anything in between, pitching becomes a part of the measure stage, and the feedback you receive is part of learning. This accelerates the Lean process for your startup, and gets you closer to product-market-fit, faster. Listen closely to the questions, and aggregate the feedback across many pitches to find the common threads. Use this to iterate for your next pitch and your next build.

Another benefit of always pitching is that you get to show lines not dots. The winner of IBM Smartcamp Boulder, Lawbooth, went on to win the regional and semi-final rounds of Smartcamp because they could show lines–progress and traction across a longer timeframe. The judges in Boulder had seen them pitch many times, and because of this, specifically commented on their growth over the past year. Being out in the community, pitching your startup over and over, while showing growth shows grit and dedication–two things investors love to see.

You can perfect your pitch through IBM SmartCamp and there are plenty of opportunities to pitch in your community too. You can look for some of the more common ones such as 1 Million Cups, events at startup weeks, or pitch competitions at local co-working spaces. Galvanize Pitches & Pitchers is one such example.

IBM’s Smartcamp is one part pitch competition, networking opportunity and a chance at competing for a spot in an incubator with investment in thirty cities globally. The top ten companies from this year’s competition got invited to LAUNCH Scale in October, and are soon to attend LAUNCH Festival in March. Along the way they got personal pitch coaching from one of the top angel investors in the world, Jason Calacanis, and had the opportunity to present in front of thousands of people at both LAUNCH Scale and soon, LAUNCH Festival.

If you’re interested in perfecting your pitch through IBM SmartCamp, you can click here to learn more about the program and enter your email address to receive details about the 2016 IBM SmartCamp.

Sales Primer for Non-Sales Startup Founders

By Startups

Originally posted on the SoftLayer blog on January 27, 2016.

The founder of one of the startups in our Global Entrepreneur Program reached out to me this week. He is ready to start selling his company’s product, but he’s never done sales before.

Often, startups consist of a hacker and a hustler—where the tech person is the hacker and the non-tech person is the hustler. In the aforementioned company, there are three hackers. Despite the founder being deeply technical, he is the closest thing they have to a hustler. I’m sure he’ll do fine getting in front of customers, but the fact remains that he’s never done sales.

So where do you begin as a startup founder if you’ve never sold before?

Free vs. Paid
His business is B2B, focusing on car dealers. He’s worried about facing a few problems, including working with business owners who don’t normally work with startups. He wants to give the product away for free to a few customers to get some momentum, but is worried that after giving it away, he won’t be able to convert them to paying customers.

Getting that first customer is incredibly important, but there needs to be a value exchange. Giving products away for free presents two challenges:

  1. By giving something away, you devalue your product in the eyes of the customer.
  2. The customer has no skin in the game—no incentive to use it or try to make it work.

Occasionally, founders have a very close relationship with a potential customer (e.g., a former manager or a trusted ex-colleague) where they can be assured the product will get used. In those cases, it might be appropriate to give it away, but only for a defined time.

The goal is sales. Paying customers reduce burn and show traction.

Price your product, go to market, and start conversations. Be willing to negotiate to get that first sale. If you do feel strongly about giving it away for free, put milestones and limitations in place for how and when that customer will convert to paid. For example, agree to a three-month free trial that becomes a paid fee in the fourth month. Or tie specific milestones to the payment, such as delivering new product features or achieving objectives for the client.

Build Credibility
When putting a new product in the market, especially one in an industry not enamored with startups and where phrases like “beta access” will net you funny looks, it helps to build credibility. This can be done incrementally. If you don’t have customers, start with the conversations you’re having: “We’re currently in conversations with over a dozen companies.”

If you get asked about customers, don’t lie. Don’t even fudge it. I recommend being honest, and framing it by saying, “We’re deciding who we want to work with first. We want to find the right customer who is willing to work closely with us at the early stage. It’s the opportunity to have a deep impact on the future of the product. We’re building this for you, after all.”

When you have interest and are in negotiations, you can then mention to other prospective customers that you’re in negotiations with several companies. Be respectful of the companies you’re in negotiations with; I wouldn’t recommend mentioning names unless you have explicit permission to do so.

As you gain customers, get their permission to put them on your website. Get quotes from them about the product, and put those on your site and marketing materials. You can even put these in your sales contracts.

Following this method, you can build credibility in the market, show outside interest in your product, and maintain an ethical standing.

Get to No
A common phrase when I was first learning to sell was, “get to the ‘no’.” It has a double meaning: expect that someone is going to say “no” so be ready for it, and keep asking until you get a “no.” For example, if “Are you interested in my product?” gets you a “yes,” then ask, “Would you like to sign up today?”

When you get to no, the next step is to uncover why they said no. At this point, you’re not selling; you’re just trying to understand why the person you’re talking to is saying no. It could be they don’t have the decision-making authority, they don’t have the budget, they need to see more, or the product is missing something important. The point is, you don’t know, and your goal here is to get to the next step in their process. And you don’t know what that is unless you ask.

Interested in learning more? Dharmesh Shah, co-founder and CTO of Hubspot and creator of the community OnStartups, authored a post with 10 Ideas For Those Critical Early Startup Sales that is well worth reading.

As a founder, you’re the most passionate person about your business and therefore the most qualified to get out and sell. You don’t have to be “salesy” to sell; you just need to get out and start conversations.

Startups should embrace both diversity and inclusion

By Startups

Originally posted on the SoftLayer blog on December 9, 2015

During the NewCo Boulder festival, web development agency Quick Left gave a talk about diversity and inclusion in the workplace. The panelists shared stories of their experiences around diversity—good and bad—and gave advice on what can be done to make workplaces more inclusive. It was one of the best talks I heard all year.

After much discussion, both philosophical and tactical, an audience member expressed concern about counter-discrimination. Would the time come when he would be overlooked for a job because he was not a diversity candidate?

This is not the first time this has been brought up in diversity discussions, and he was expressing what many (perhaps too many) straight white males think when diversity is discussed. To the credit of Gerry Valentine, one of the panelists, he did not chastise the audience member, and instead commended him for his bravery. The man who asked the question gave voice to a common concern that is often thought, but rarely brought up. The panelists at NewCo Boulder handled it very well, pointing out that no one wants a job just based on their gender, skin color, sexual preference, or anything other than their ability to execute on the job. And, collectively, we want to create a world where everyone has the opportunity to compete for jobs on equal ground.

I was truly moved by the entire session, but found myself upset that even at the close of 2015 we are still answering questions about counter-discrimination. When Gerry commended the question for its bravery, I first wondered if he was being glib. But knowing Gerry, I was certain he was serious about his comment. Upon further reflection, I realized what’s interesting about this “pale and male” pushback is that it comes from a place of fear. A fear of discrimination is at the root of the question when someone asks, “As a white male, am I going to get passed over for a job because this company wants to hire for diversity?”

Following Gerry’s example, it’s OK to acknowledge that fear. It’s OK to point out that white men don’t want to live in a world where they are discriminated against, even subtly. While that is a valid fear, for the straight white male candidate, it is only a fear of a potential future. If they can imagine potential discrimination, can they acknowledge that the reality of our world today: anyone who isn’t a straight white male does experience this as real fear. Imagine walking into a job interview having to first overcome the things about you that you cannot control (gender, skin color, sexual orientation, physical handicap, economic background, country of origin, etc.) just to get to a level playing field with the other candidates. If you don’t want this for yourself, you certainly wouldn’t want it for anyone else.

In startups, we love to talk about unfair advantage, but when it comes to hiring, the only unfair advantages should be skills and experience. What the movement for inclusion and diversity is about—and what we should be striving for—is a world where we all compete equally. If it is a brave thing to express your fear publicly, it is braver still to acknowledge the reality of the situation and work to rectify it.

One of the things I love about the startup community is that once we identify a problem, we move forward to solve it in as many ways possible. The path to inclusion in the workplace doesn’t have to be a pendulum that oscillates between two extremes—discrimination and counter-discrimination—before settling down in the middle. Pendulums are a relic of the industrial era. In the digital era, we can choose our target, set our standards, and move forward as a community to achieve them. As you build your startup, build inclusion in your workplace from day one.

The Dumbest Thing I’ve Ever Said

By Startups

Originally published on the SoftLayer Blog on October 21, 2015

Last week, I attended the LAUNCH Scale conference and had the pleasure of attending the VIP dinner the night before the event began. We hosted the top 10 startups from the IBM SmartCamp worldwide competition for the dinner and throughout the events. Famed Internet entrepreneur Jason Calacanis joined us for the dinner and gave a quick pep talk to the teams. He mentioned that people come up to him and lament that they wished they’d gotten into the “Internet thing” earlier—and that he’s been hearing this since 1999. His story reminded me of a similar personal experience.

In the fall semester of 1995, I was a junior at St. Bonaventure University, working in the computer lab. One day after helping a cute girl I had a crush on, she said to me, “You’re so good with computers, why aren’t you a computer science major?” Swelling with pride, I tried to sound impressive and intelligent as I definitively stated, “Windows 95 just came out, and pretty much everything that can be built with computers has been built.”

Yep. Windows 95. The pinnacle of software achievement.

It is easily the dumbest thing I’ve ever said—and perhaps up there as one of the dumbest things anyone has said. Ever.

But I hear corollaries to this fairly often, both in and outside the startup world. “There’s no room for innovation there,” or “You can’t make money there,” or “That sector is awful, don’t bother.” I’m guilty of a few of those statements myself—yet businesses find a way. We live in an age of unprecedented innovation. Just because one person didn’t have the key to unlock it doesn’t mean the door is closed.

Catch yourself before you fall into this loop of thinking. It might mean being the “Uber of X” or starting a business that’s far ahead of its time. Think it’s crazy to say everything that can be built has been built? I think it’s just as crazy to say, “It’s too late to get into ___ market.”

For example, when markets grow in size, they also grow in complexity. The first mover in the space defines the market, catches the innovators and early adopters, and builds the bridge over the chasm to the early and late majority. (For more on this, read Crossing the Chasm by Geoffrey Moore.) When a market begins to service the majority, the needs of many are not being met, which leaves room for new entrants to build a business that addresses the segments dissatisfied with the current offerings or needing specialized versions.

The LAUNCH Scale event showcased dozens of startups and the innovation out there in the world always amazes me. I’d recommend it to any startup that has built something great, and now needs to scale. Still haven’t built something yourself? Think you missed the opportunity to build and create? In 1995, I didn’t think about how things would change in five, 10, even 20 years. Now it’s 2015 and the startup world has been growing faster than any sector in history.

Think everything that could be built has been built? Think again. Want to build something? Do it. Build something. What are you waiting for? Go make a difference in the world.

Free Resources for Your Startup

By Startups

Originally published on the SoftLayer Blog on August 25, 2015.

Building and running a startup is both difficult and expensive. From salary to servers to services, the demands on your budget are constant and come from all directions. On the Catalyst team we know this firsthand—our program was created as a way for startups to access SoftLayer’s robust platform before they have revenue or funding.

After moving to Boulder, Colorado in 2012, the first startup I joined was a member of the Catalyst program. Without Catalyst, our organization would have been paying out of pocket for the bare metal servers we needed. Instead, that money was freed up for other essentials (like food to keep us alive).

Infrastructure isn’t the only area in which startups can leverage free offerings. Since joining the Catalyst team one year ago, I’ve tracked and collected other free resources for startups. I compiled my research into a presentation that I’ve given at a few events. The presentation is available on SlideBean(a free online presentation platform, what else?) and is constantly being updated. Some highlights are below:

Big Company Programs
The Catalyst program is a model on how big companies can meaningfully engage with startups, and we’re not the only ones doing it.

  • SVB: Silicon Valley Bank offers a program called Accelerator. Perks including free checking and financial mentorship. While saving on business checking won’t make a big dent in your cash flow, the financial mentorship is top notch. The SVB team consists of experts in banking who can offer advice on fundraising, financial instruments, and cash management.
  • SendGrid: Email deliverability is crucial for your company, so start with the best in the business. The free plan includes 10,000 emails per month, up from 200 emails per day when I first started giving this talk. Go to the pricing page and scroll down to the bottom for the free plan. (Full disclosure: SendGrid is a former partner.)
  • NASDAQ Exact Equity: I was recently at a VC conference, where I had two separate conversations about investors’ frustrations with disorganized or downright undocumented cap tables. The NASDAQ Exact Equity freemium tool will not only help you wrangle your cap table, but it will also signal success to the investor by showing that you’re thorough and organized.

Startup Freebies
I’m not going to cover the basics, such as Evernote, Trello, Asana, Pivotal Tracker, Launch Rock, Bootstrap, Google Drive, etc. You probably already know about these programs. Instead, I’ll share a few great ones you may not know about.

  • Docracy: If you need any sort of legal document, Docracy should be your first stop. The legal documents were prepared by lawyers and are available for free. The choices range from SaaS Terms & Conditions to founder agreements.
  • HTML5 UP: Need a quick, easy, and responsive template for your site? When WordPress is too much of a hassle for a splash page, head over to HTML5 UP for dozens of choices of free templates.
  • UI Kit: As you’re moving from the free HTML5 UP template toward being able to build out your site with the free Bootstrap toolkit, save yourself coding time and get the UI Kit for free design elements such as lightbox, slider, accordions, and more.
  • SlideBean: I love SlideBean. While searching for “free PowerPoint templates,” I discovered that all the templates were hideous. Then I stumbled across SlideBean and fell in love with it. It makes putting together a presentation quick and easy, and keeps it from looking like you traveled to 1999 to get your template.

Collections
Below are my favorite collections of resources for any freebies that I haven’t already covered.

  • Product Hunt List: The founder of CrazyEgg and KISSmetics has an exhaustive list of free and freemium products for your startup.
  • Freebie.supply: Over 400 resources are grouped by category. I especially love the design resources.
  • Startup Stash: Not all of the free deals, mostly in the form of percentage discounts. But if you’re going to pay for something, check F6S first for a discount.

And finally, the best piece of advice when trying to save money can be found in my last post: A Grandmother’s Advice for Startups: You never know ‘til you ask.

Have a free resource that you absolutely love that’s missing from my list? Email me atrmaloy@softlayer.com or tweet me @stoneybaby and let me know!