Scaling Your Startup

Limerence. New York Times best-selling novelist David Brooks touted this concept, describing our conscious and unconscious minds as always contending, vainly seeking to reconcile their disparate desires. The former seeks money and success while the latter pursues transcendence through labor of love.

I became intimately familiar with this concept over the past few months at InsideMaps, a Stanford StartX company, that crafts a platform through which one can virtually experience one’s home. Our team was constantly striving to innovate, market and sell our solutions, and I fell in love with business development, envisioning a promising future for our clients. These times were trying, but the lessons gathered are invaluable. As I listened to people much wiser than me, I learned the basics of bringing a product to market.

Today, I would like to very humbly share this knowledge with you. My method is broken down into three simple steps: Prepare, Sell and Scale.

Prepare

Define product market fit. Your first task as a business developer should be to fully understand your product and determine your value proposition. You will want to interview your engineers to understand the technicalities of your product. This entails spending time with each individual and writing reports about what you learn. Then, you may want to synthesize your findings by drafting technical documents. Ensure you fully understand your product before moving forward and drafting compelling one-pagers and pitch decks. If you would like to learn more about how to create compelling pitch decks, I suggest looking into Venture Capitalist Dan Gordon’s Solution Pitching framework.

Study competitive landscape. Once you are able to communicate the unique benefits of your solution, try spending time understanding your competition. Dan Gordon suggests outlining each competitor’s market traction (approximately what percentage of the market do they address?), differentiation (how do they distinguish themselves?) and “our line” (what can your company do better/differently than competitors?).

Outline total available market (TAM). Now, you should define your TAM because you might have a revolutionary product, but if your TAM is too small, you will never be able to scale significantly. Note that most Unicorns (companies valued at $1 billion or more) have momentous TAMs. If your TAM is small, you might consider pivoting by morphing your solution to address a broader client base.

Sell

Determine clientele. Once you understand your TAM, you should segment your clientele. It is likely that your clients fall in various buckets and you must market yourself differently to each. Therefore, it is important to determine these verticals and outline the main players for each of these. Then, you should create a prospecting list and start strategically reaching out to executives at your target companies. You should be able to find these people’s emails using LinkedIn’s Rapportive add-on (see this online tutorial). Most should be interested in a conversation, since you are well prepared and ready to define what they have to gain from working with you.

Generate pricing models. Create pricing models outlining your fixed-costs (rent, payroll, overhead, etc.) and variable costs (price per delivering one unit of product), and your sale price-per-unit. Make sure to study your competition and clearly depict how your clients can benefit from switching to your solution, by either saving money in the short-run (through lower pricing) or long-term (thanks to increased market exposure, shared-revenue agreements, etc.)

Reach out to prospects and land initial wins. The fun begins now. You should start reaching out to your prospects to land several early wins. If you are sufficiently prepared, you should be able to gain significant market traction within a few weeks or months.

Scale

Find more funding or break even. Now that you were able to gain market traction, you should be able to figure out how/when to break-even and start generating profits. If you choose instead to raise more funding to sustain your growth, you are in a good position to do this, as you can show an increase in users of your solution, allowing you to entice venture capitalists to invest in your growth through a Series A funding round, for example.

Hire sales team. You should build a sales team to address each of your market verticals. Your salespeople should initially be focused on outbound sales (prospecting and building relationships with new clients). To learn the intricacies of this process, I suggest reading The Sales Acceleration Formula by Mark Roberge.

Start inbound marketing campaign. You are now in a good position to transform your sales organization into a marketing agency by focusing on inbound marketing (generating leads through content creation). To learn more about this complex but rewarding process, I suggest taking the HubSpot Inbound Marketing Certification and using tools like TrackMaven (to measure your impact).

So yes, endeavoring to grow a startup is quite an undertaking, but the thrill of the chase and learning opportunity are unsurpassed. I would recommend this experience to anyone.

Please feel free to comment below or reach out directly. I hope this post is helpful and look forward to starting an enriching conversation.