Category Archives: Lessons Learned

Posted On October 17th, 2017 by Crowded Ocean

5 Steps to Pump Up Your Startup Marketing

 

  1. Write your launch press release first. Then manage to it.

As much as startups like their white boards, when it comes to their core positioning, product capabilities and supporting messaging, they don’t take anything seriously until they see it in print (or in PPT or HTML). As important as a launch is to a startup—and as important as press coverage is to the launch—you’d think they’d recognize the fundamental importance of the press release and act accordingly. And yet most startups don’t write the release until about 3 weeks prior to launch. Only then are fundamental inconsistencies and misunderstandings revealed, causing everyone to scramble, from website authors to the PR firm. Instead, draft your news release as early as possible to crystallize messaging. Start by writing your ideal headline for the launch, then write the release that will best generate that headline. Then take the components of that release and insert them into all your key marketing and sales materials.

  1. Kill your “elevator pitch”; replace it with your “bold claim”

The “elevator pitch” is a time-honored marketing exercise and tool for distilling your company’s value proposition. But we’re living in an ADHD world where your prospective customer is addicted to nonstop interruptions in multiple streams delivered on multiple screens. So forget the elevator ride: you don’t have that long. Imagine you’re on an escalator instead, with 30 seconds to make your pitch. Lead with your ‘bold claim’. It starts with: “what if I told you that…” (An example: ‘What if I told you that you could wash your car while driving it home from work?’) An effective bold claim poses a question that generates this customer response: “I don’t believe you can do that, but I’ll take your card.” It’s a statement that sits at the core of your sales pitch, PPT decks and website–one provocative enough to grab your customer’s attention and initiate the sales process. 

  1. Posterize your “buyer persona” 

Defining the buyer persona is a best practice supported by business books, courses, institutes and online tools. And it makes more sense than ever now because customers have more power and more options. But for so many companies creating a customer persona is just a paper exercise. The key is to develop a 3-D understanding of your persona’s personality and affinities, knowledge that you can then apply to your website, sales pitches, and white papers—and to make it a company exercise. The more advanced startups not only create these 3-D images of their customer, they name them and put an image (or imagined photo) of them on their walls, reminding everyone of what (and whom) they’re working for. This is particularly true of the Sales “war room,” where the customer persona should have equal wall space with all of your competition’s material, a constant reminder to stay focused on your customers—their needs, their options and their reasons to choose you.

  1. Name a “chief content officer” and give them a seat at The Big Table

Think about it: in an enterprise product sale, the average sales process requires seven ‘touches’ (or interactions) with your prospect. So, to support their transition from prospect to buyer, you’ll need at least seven pieces of original content. And yet, for many startups, content is a last-minute addition to their launch and sales efforts.

Content needs to move to the top of a startup’s Maslow hierarchy. And it has to be everybody’s job. The problem is that every team at early-stage companies is so busy iterating on their product—both in features and possible business applications—that crafting sales content for lead nurturing and demand gen often takes a back seat. We recommend designating a “chief content officer” and giving him/her a seat at the big table for sales pipeline reviews, product planning meetings, maybe even board meetings. Make generating topics and content ideas a corporate-wide function, then recognize and reward those who generate this content—blogs, mini-white papers, etc.

  1. Treat diversity like revenue: set goals and manage to them

Diversity is not only good for a company’s culture, it’s good for business, paying off in better decisions and improved profitability. But how to achieve it? A few innovative startups like Slack have adopted the Rooney Rule that requires that “persons of color” and women be candidates for strategic hires within an organization. Meanwhile, VC firm and startup builder Kapor Capital has taken the Rooney Rule a step further by requiring their own firm be diverse. Now, Kapor Capital partners are requiring the startups they invest in to create a culture of inclusion from the beginning. They ask their startup founders to sign a diversity pledge, then deliver a diversity report every quarter to investors.

Tech titans like Apple, Google and Salesforce have diversity initiatives that they report on publicly. Startups can build diversity in from the ground up by giving it the same status in their business plan as goals for customer acquisition, revenue and profit. And, by reporting on those goals every quarter to your board, investors and your team you’ll be able to reinforce diversity as a value and a business goal that will help set your startup apart.

 

Posted On October 12th, 2017 by Crowded Ocean

Startups: Mission, Vision and Purpose statements

Readers of this blog know that we’re not big fans of ‘Mission Statements’. Even for those companies who aspire to—and perhaps even achieve—the goals of their mission, these goals are too often vague and euphemistic. Worse, they’re self-directed, focused inward, rather than out towards the market. In the early phase of building a startup, we practice sales-based marketing* and mission statements rarely helped your sales team open doors with critical early customers which is another reason we’re not in favor of them.

Purpose Statements, not Vision Statements

While we like ‘Vision Statements’, often as an early slide in an investor deck, there is an even better ‘statement’, one that combines Mission and Vision: the ‘Purpose Statement’. It has the benefit of being pragmatic, answering the question “Why are we in business?” More importantly, it has multiple audiences: for investors, a well-written Purpose Statement is more pragmatic than most Vision Statements. And for employees, a CEO can stand in front of a Purpose Statement and say: “This is what we’re all about. If your job isn’t in direct support of this statement, then we either need to change your job’s objectives or change the statement.”

Take a step back

Our suggestion: if your team is laboring over your Vision or Mission statements, take a step back and look at why you started the business in the first place. Then go from there.

* Sales-based marketing: The job of Marketing comes down to 3 words: Make Sales Easier. If it doesn’t initiate new sales, shorten the sales cycle, or make repeat sales easier, don’t do it.

Posted On September 26th, 2017 by Crowded Ocean

How to make your company vision more like a cause

If you want to make your company vision feel more like a cause, write a manifesto. Here is our manifesto for building the ultimate startup.

  1. Hire the core and outsource the rest. Companies that distinguish their core (sales and go-to-market strategy, technology, product roadmap) from what can be outsourced or hired on-demand maximize flexibility in the face of a changing market dynamics and competition. For example, the program mix, orchestration and sequence of the marketing deliverables is what an experienced head of marketing owns. But, he/she can outsource to specialists deliverables such as SEO, content development, PR, event marketing.

 

  1. Pick your board carefully. Experience and true partnership trumps valuation. A team of experienced investors and advisors can help cultivate and coach a good team to become great. Worry about the structure of the deal (liquidity and preference) more than valuation.

 

  1. Leadership comes with a sell-by date. The familiar tropes of successful startup leaders are the demanding dictator with a mercurial temperament; the brilliant engineer with stunted social and leadership skills; the cerebral and brooding visionary. These are stereotypes today because we’ve seen them at the helm of successful startups over and over. But as soon as the sales numbers falter, out goes the leader. Nowhere is the tenure of the CEO more limited than in an early-stage startup. That’s why startup leaders have to constantly, relentlessly be vigilant that it’s the company that must triumph, not the leader.

 

  1. The most important attribute of company culture is how you make decisions. Successful startups understand where they are on the spectrum of company culture. Culture that matters has nothing to do with whether there are bagels on Wednesdays or free neck massages or whether there is a ping-pong or a foos-ball table on site. Successful companies can be consensus-oriented. They can be transparent or secretive. The but the core of the culture that matters is really all about how decisions are made and better decisions come from well-informed, diverse teams. Diversity as a value

 

  1. Team trumps technology. Smart teams can solve product-market fit misfires. So there is nothing more important to long-term success than hiring the right team. Assume you will make hiring mistakes, so recognizing and firing as early as possible is essential. Salute the industry data that shows diverse teams (gender, ethnicity, psychological) make better decisions and seek out diversity from the beginning.

 

  1. Nail down your positioning during your customer development phase. As you invest early in customer development to identify the profile of the target buyer and use case for your new product, build in time to start nailing down your positioning and messaging. Then, it’s the job of the VP of Marketing to bring a toolkit approach, including a knowledge of “best practices,” and a willingness to pilot new ideas and measure the results to figure out what works to gain early market traction for your new product out in the market.

 

  1. Successful marketing is upstream and integrated. There are steps in the agile software development process – frequent sprints, testing, iteration, repeat – that are popularly applied to company building as part of the “lean startup” mantra. But when it comes to marketing, startups still need to integrate marketing across all sales channels and across all functions and this takes experience and the discipline of planning. Protect your go-to-market strategy as “core”, so it can have its greatest impact positioned upstream in the planning process, at the management table, and right along side customer development.

 

  1. Sales-based marketing accelerates customer acquisition. If it doesn’t initiate sales or make repeat-sales easier, don’t’ do it. An almost rabid focus on customer development first, is what helps drive early market traction. But marketing still requires piloting, testing and measurement to figure out what works. There is no “single tool” approach that will accelerate customer acquisition and shorten time to revenue.

 

  1. Launch is one milestone in the process of building a company, not the finish line. Startups say they launch to “legitimize” their business in the eyes of customers. Some startups say that launch is needed to be able to attract the right talent to build their team in a competitive job market. Still others say launch is about wooing future investors and channel partners. Many say it’s all of the above. Bottom line, launch is about investing in getting your story out in the marketplace in a powerful, differentiated, memorable and unified way in order to connect with stakeholders in order to grow and scale your company. Launch is a milestone in the long life of your company. Don’t make the mistake of thinking of it as the finish line.

 

  1. There can never be too much content. Building market awareness and sales preference for your product requires a boatload of content. Your ability to capture the imagination of your target buyer and to break through the market noise requires a steady stream of new, fresh, updated content. Whether it’s written or rich media (audio, image, video), it’s got to be accessible and shareable and increasingly, it has to be personalized and snackable. Equipping your sales team or channel with the right tools to reach your prospect starts with compelling, consistent, quality content.

Posted On September 20th, 2017 by Crowded Ocean

How to be a lousy client (#6)

Your sh%$ doesn’t stink…

The news these days seems to be either a wonderful range of perp walks (Martin Shrekli, Travis Kalanick, Parker Conrad) or staged mea culpas (a rogue’s gallery of VCs and tech executives who have suddenly gotten religion about sexual harassment and inequity within their companies). But how they got to these points was clear: along the way they came to believe that their shit didn’t stink. (The NY Times has a great article on this phenomenon, called ‘moral disengagement’)—a belief system that was reinforced by those who supported them (among whose number, we have to believe, were their investors as well as employees.)

It’s great, after the fact, to blame the parents and school officials who allowed this behavior to proceed unchecked. But you play the cards you’re dealt, and if employees or investors don’t call your clients on their behavior, strategic advisors/marketing agencies have two choices:

  1. call your clients on their behavior yourself (and probably lose the account), or
  2. shut up and do the work, knowing that you’re kicking the same can down the road.

Crowded Ocean is in a unique position because we get in to a company early (during its formation or as it goes to market). And we’re working with CEOs (often tentative, first-time CEOs) directly and behind closed doors.

As a result, we can offer our advice as being couched in self-interest. (“We’re only telling you this because we want you to get phenomenally rich and we can claim responsibility.”) We also appeal to their vanity. (“Better that we tell you that your zipper’s down than that the market does.”)

Does that mean that we’ve been able to steer our difficult clients from the path of ‘moral disengagement’? Hardly, but we sleep a little better at night for at least being on the record about their behavior.

 

 

 

Posted On September 5th, 2017 by Crowded Ocean

How many assholes does it take to tank a startup?

Below is a past blog post that triggered many favorable comments from readers. So, we’re bringing it back for our fans…

Despite the celebrated “no assholes” rule that many founders claim defines the culture of their startup or is a guiding rule for interviews/hiring, our experience is a lot of assholes slip through the net.

Here are some of the types that we’ve encountered:

Dick, the brilliant coder: This is a stereotype, to be sure, but where do you think stereotypes come from? These are the socially- and hygienically-challenged guys who live in their own bunker and aren’t allowed to interface with customers. The largest % of assholes is among the technical group, many of whom lack both the social skills and the self-awareness to even know they have a problem. And they get to skate because of a simple fact: no product, no company. Unfortunately, they will hire in their own image and then you’ve got an engineering team of assholes.

Dick, the sales chief: Just as CEOs will defend obnoxious behavior by citing Steve Jobs, VPs of Sales will defend their boorish behavior by saying the pressure they’re under to drive revenue (often when the product is late or still being created) entitles them to be an asshole. Maybe it’s in the DNA, but, unlike the technical founders, these guys (and they’re almost always guys) can control themselves. They just choose not to..

Dick, the board member who is a self-appointed expert in marketing: This guy surfaces when launch plans, timelines and fundamental positioning and messaging are being finalized. Because he is a board member, he can claim the freedom to exit the boardroom and wander the halls, opining about everything from product nomenclature to website structure. Under the guise of ‘just trying to help’ he (and they’re almost always guys) can either hijack or move the launch off its track. Trust us, we’ve seen it. If the CEO lets this go on, it can be incredibly destructive to the team.

Board members can bring pivotal insights and advice at critical points in the lifespan of a startup. But they never seem to offer advice as “a” point of view. It’s always “the” point of view (or an opinion that the offer as ‘fact’) that can sway the startup team in a way that shuts down conversation or consideration.

If you don’t believe us when we say assholes in Silicon Valley are a problem, read the book from 2007 by Dr. Robert Sutton. Or, better yet, take the self-assessment by none other than Guy Kawasaki.

 

Posted On August 29th, 2017 by Crowded Ocean

Why is the CMO role at a startup a turnstile?

Crowded Ocean spoke last week at the annual National Venture Capital Association (NVCA) meeting about a new framework for building an effective marketing program for enterprise startups. We call it marketing-as-a-service (MaaS).

This recent article in VentureBeat explains the MaaS model and how it works off of three basic principles:

  1. Hire the CMO last;
  2. Justify every hire;
  3. Hire only for the core; outsource the rest.

Below are answers to three of the top questions about MaaS that we addressed at the NVCA meeting and also on this new podcast entitled “How to find the right CMO for your startup”:

  1. Isn’t the problem that there is simply a shortage of trained marketing professionals?

Actually, the problem is that there is a different marketing skill set required during different phases of a startup’s life. The first phase is product management which is a highly technical focus on defining the product roadmap. The second phase is corporate marketing to drive the positioning, messaging and launch of the startup with a team of virtual specialists. The third phase is product-marketing, which requires a marketing leader steeped in the industry domain of the startup. A fourth component of marketing is about “instrumenting” marketing to automate and measure elements of marketing like content offers, calls-to-action, demand generation programs. No candidate that we’ve worked with in launching over 45 startups is versed in all four, so we suggest doing Product Management in-house with the founding team, outsourcing the launch to Corporate Marketing specialists, then hiring the CMO.

  1. How can a team of contractors actually deliver at the same level that a startup employee can deliver?

Startups should approach their staffing plans by having to justify every hire, which means hiring only for core capabilities. By understanding what is “core” to your company business and deciding to outsource the rest – particularly during the first two phases – a startup can keep headcount lean and can maximize the flexibility to build out the team after company launch.

  1. Do you have a way to measure the effectiveness of MaaS?

 Let’s start with the negative: The cost of hiring the wrong person to lead marketing, or hiring that person at the wrong time, is immeasurable, from market presence to team morale/retention to initial revenue. With best practices in marketing constantly evolving, Marketing as a Service lets you tap into marketing specialists in everything from web design to video content to email marketing—all without parting with a single headcount. The startup can stay lean, nimble and current while being prepared to iterate based upon data and feedback. Bottom line: the Marketing costs in a company’s earliest stages will be significantly lower than with the traditional Marketing model. And the initial success—however you choose to measure it—will be greater with this lean, focused MaaS approach.

Posted On August 22nd, 2017 by Crowded Ocean

New startup jargon in startup-land

‘Resters and Vesters’:  talented engineers who have lots of unvested shares of stock in privately held but “hot” startups are said to be “coasting” along and not really working that hard.

DNA data storage: researchers have now demonstrated how data can be converted from the 1s and 0s of binary code to the As, Cs, Gs and Ts of human genetic code. Because of that, researchers predict that the space-saving potential of data stored in DNA will be the solution to the enormous need for data storage. Theoretically, DNA storage could provide a cheaper and more environmentally sound alternative to huge server farms. There is a short shelf life to data stored on hard disks, flash drives, mag tape and DVDs, but data stored in DNA is believed to be able to last thousands of years.

Doxxing: according to an article in Recode, doxxing is “searching for and publishing private or identifying information about an individual on the internet, typically with malicious intent.”

Smart dust: according to the Wall Street Journal, this is “tiny, wireless micro-electromechanical systems that can detect measurements such as light and temperature.”

Foiling: the latest sports craze in Silicon Valley – and favored by many tech entrepreneurs – is called hydrofoiling, or foiling for short. The sport combines a small surfboard with rudder, motor and kite.

Posted On August 16th, 2017 by Crowded Ocean

The Importance of a Mentor for your Startup

In researching our book, The Ultimate Startup Guide, we went back and interviewed a number of our founders, the bulk of whom were first-time CEOs at the time. While it’s a cliché to talk about the importance of ‘knowing what you don’t know’ (a unifying characteristic of our most successful founders), a byproduct of this humility was the importance they attached to having a mentor, both in their earliest days (brainstorming ideas the researching the market) and in their tough moments in founding and managing an early-stage startup.

Knowing what you don’t know

Mentors come in all shapes and sizes. The obvious mentor for the first-timer is a friend who’s just a few years ahead of them in the startup game, someone whose scars are fresh and on-point to what our CEO is facing. Or it can be a more established CEO—someone from their past that they admire and perhaps subconsciously (or consciously) want to emulate.

But sometimes the mentor falls a little further afield, such as the business professor who inspired them in the early going. Or the VC from a previous company who may have stepped back from the action and has time to meet and coach.

From The Ultimate Startup Guide:

We know of one young startup CEO who uses an established organization as a critical advisor. The CEO is a member of the Young President’s Organization, a peer group and network that offers education, support and idea exchange for young company CEOs. That’s a rarity. More commonly, strategic advisors are invited into the tent based upon their past relationships with the founding team or board or specific referrals by friends-of-the-founders.

The advisor role generally resembles a part-time consultant and reports to the founder, or perhaps a board member. The typical relationship between startup and strategic advisor includes a grant of stock options to the advisor in exchange for their counsel. (See the handy FAST document noted at the end of the chapter from Founder Institute for guidelines on the amount of equity.) Advisors typically report to the CEO and often get a lot of latitude and access to the startup team, early customers and board members. And a group of advisors that include marquee names can bring a halo of early shine to a company while still in stealth and certainly through launch.

But, remember: Every advisor you retain is going to require some of your personal time, so walk before you run. Start with one, maybe two advisors. (And making time for your strategic advisor outside of the office in order to cultivate rapport and trust will pay off. But, again, that’s your precious time you are committing.) So, make sure every advisor fills a strategic gap; is a complement to you and your personal style; is well connected, accessible and available to you. Once you’re an established company and you have a number of advisors in key areas—that’s the time to bring them together as an Advisory Board. Until then, recruit and manage them individually.

Finally, don’t overlook the idea of mentors in different fields. A friend who has been a VP of Human Resources (or still is) can be a great resource in staffing (and how to fire, if it comes to that). If asked to, they can help you not just with your current situation but with developing a long-term plan in their discipline that will help you grow the company.

Bottom line: it’s great to acknowledge what you don’t know. Mentors can help you do something about filling that gap in your experience and knowledge.

Posted On August 9th, 2017 by Crowded Ocean

Why startups need a “COO in a box”

For most of our existence, our clients have used the short-hand phrase ‘corporate marketing in a box’ to describe who we are and what we do. While the more accurate description might be ‘Marketing-as-a-Service (MaaS), we’ll answer to either one.

Recently, as more and more services, functions and departments go on an ‘as-needed’ basis, we’re seeing a new function evolve: The COO in a Box. It’s a function that, at least from our perspective, is badly needed at many of our startups.

Think about the standard enterprise startup: it’s usually founded by a core team of technologists, the most business-oriented of whom wants to be a first-time CEO. That’s a lot to handle, especially in terms of learning the ins and outs of sales, marketing, legal, support services, etc. When—and how—they need help will change with each company, but it’s the rare company that doesn’t need some sort of operational support in its early stages.

Here are the two times that we see the COO In a Box as being particularly valuable. The first is right after the launch. Up until that point, our experience is that the team has the capability and focus to do it on their own. Launching a company is an exhausting, all-hands-on-deck initiative, but it also pulls the company together, especially since it has a finite timeline and a nice payoff at the end. The question, post-launch, though, as everyone goes back to their regular jobs is: how are we going to sustain this momentum? That’s when a COO in a Box can help.

The second area usually comes around the Series B timing. The company has launched and had early success. Now it’s time to leverage that success and do the most important thing a new company can do: Scale. Again, the team is probably inexperienced and ill-equipped to scale, but a COO in a Box, if s/he has done this before (and they better have, if they’re marketing themselves as an experienced officer), is the right person to focus and align the company, leaving the CEO to focus on product, long-term planning and vision and the rest of the company to keep the engine going.

 

Posted On July 24th, 2017 by Crowded Ocean

On the radio: startup strategies with Crowded Ocean

Check out Tom and Carol interviewed about The Ultimate Startup Guide:

Listen to KGO Radio 810 Techonomics with host Jason Middleton

  • Part one (11:44 minutes)
  • Part two (19:06 minutes)

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