Category Archives: Startup Marketing

Posted On April 25th, 2017 by Crowded Ocean

Tweets versus coding: lessons for startups

When we meet with a startup led by technical founders, it’s common for us to discover that the majority of the team have profiles or pages on channels like LinkedIn but they are far from active there. In fact, if they have a Twitter handle, it’s probably dormant. Consequently, we never assume that social media is considered by the team as a channel to engage with customers. And startup teams are typically so busy coding and wooing customers in the early days that social media—even if it’s viewed as important (and many tech startups don’t share that view)—is considered a priority for another time. So, what are the lessons for startup teams about when and how best to employ social media?

Taking a phased approach to building your social media program

There’s a phased approach to building smart social media habits that’s very doable and productive. As we outlined in Chapter 14 of our book, The Ultimate Startup Guide, we recommend that during the early days startup teams appoint a single owner of social media. Just as a startup needs a Chief Content Officer to really “own” (but not necessarily produce) all content, your startup needs someone to own your social presence. Choose someone on your team who already has a natural affinity for communicating and connecting via social channels. That’s the person to tap early on to be a rallying point, teacher and role model across your team in the early days of your startup. Remember that it’s temporary. With growth (and revenue!) can come additional staff, a PR agency resource or a dedicated contractor to staff your social media program as you grow.

Name an owner of your social channels         

After appointing an owner, step two is to determine your goals and your audience. And then, step three, prioritize the social channels that will support your goals. The top three channels for many startups tend to be: Twitter (for connecting with prospects, partners and influencers), Youtube (for sharing rich media content_ and LinkedIn (for recruiting new talent and for connecting with customers.) And, down the road, maybe you’ll want a couple of flat screen TVs – one in the lunchroom and one in your lobby – to display tweets and posts in real time to keep your team connected to your customers.

 

Posted On April 18th, 2017 by Crowded Ocean

Lessons for startups from social media grenades

It’s rare to find a B2B startup founder who is fluent in social media. The nonstop demands of company building diminish the time that can be devoted to social channels, whether that’s Twitter or Facebook or Github or you-name-it. And besides, as the theory goes, that’s a task best delegated to the marketing or customer success team.

For consumer-facing startups, however, it’s a different story, because an unfiltered tweet or video from an unhappy customer can be punishing to a consumer brand’s reputation and market valuation. (Just ask UAL CEO Oscar Munoz.) That’s why those companies have entire teams of employees devoted to staffing and responding to dialogue on the social channels of consumer brands.

Tweets can be brutal

Even so, the move by the new CEO of the company that owns Carl’s Jr. and Hardee’s restaurants took social media engagement to another level. One of the new CEO’s first requests, according to this New York Times article, was to install screens at company headquarters to display real-time social media conversations about its brands for all company employees. That’s a bold move, but a pragmatic one in the wake of recent, so-called “social media grenades” hurled at Pepsi and United Airlines.

It used to be that if you wanted new execs to get close to the customer, they could join the call center team staffing customer or tech support and listen in to learn common customer complaints. Today, a single negative comment or tweet by an unhappy customer can quickly spread to thousands, or even millions, of other customers. Rapid detection and response is the name of the game, and that leaves no time for internal deliberation.

Duck and cover

That’s why an early stage startup needs to appoint an owner of your company’s social channels. Choose someone on your team who already has a natural affinity for communicating and connecting via social channels. That’s the person to tap early on to be a rallying point, teacher and role model across your team in the early days of your startup. Remember that it’s a temporary assignment. With growth (and revenue!) can come additional staff, maybe a PR agency resource or a dedicated contractor to staff your social media program as you grow. But appointing a temporary owner means at least you’ve got someone monitoring commentary about your brand and product and, at the very least, someone to yell “duck” if some industry wag lobs a grenade.

Posted On March 21st, 2017 by Crowded Ocean

New terminology seeping into the mainstream

Incidental collection: in case you missed this tantalizing term brought to you by the House Intelligence Committee hearings, when the NSA wire-taps a foreigner or U.S. citizen suspected of terrorist activities, they can sometimes collect other communications. That’s NSA-speak now entering the mainstream.

Explainable AI: a field of research that, according to the Wall Street Journal, can explain in natural language how a machine learning model arrives at a logical decision.

Filter bubble: According to the New York Times, “the filter bubble describes the tendency of social networks like Facebook and Twitter to lock users into personalized feedback loops, each with its own news sources, cultural touchstones and political inclinations.”

Echo boomer: Census data indicates that there are more 26-year-olds in the U.S. than people of any other age. Like the baby boomer generation, the economic, retail and labor force of that large number of our population are expected to “echo” the influence of the prior, very large baby boomer generation.

Gaymoji: No explanation required. But if you must, check out this New York Times profile.

Posted On March 14th, 2017 by Crowded Ocean

It’s COO and COS season in startup-land

Most of the 45+ startups that we work with start with two technical founders, one of whom has the experience and desire to be a CEO, the other wants to be the CTO. Both of them are outward-facing in some way, either in a Sales mode (the CEO) or an SE role (the CTO). Which means they get around to managing the company in their spare time.

To balance that “outside” focus of the co-founders, many teams in startup-land are recognizing the need for adding an “inside guy” to the team. That third leader is operational in nature, focusing on critical components like finance, HR, systems, strategic planning and training. In the past, that person was not equal to the top two dogs (CEO and CTO), but that role—and its importance—is changing.

COO for growth

Recently, a couple of high-flying startups have announced plans to hire a COO. First, there’s Dave McClure, CEO of 500 Startups announcing plans to hire a COO in order to support growth plans. Although the skills and division of labor have not been described, this article on Quora provides a long list of the attributes of a successful COO. That COO is made from a position of strength and augments an already-positive situation.

COO for cleanup and discipline

Then there’s Uber CEO Travis Kalanick, who is hiring a COO in the wake of allegations of sexism, sexual harassment and a public tirade by the CEO himself. And just a month ago, Uber was accused of taking advantage of the airport protests that erupted during the immigration bans. Although no plans have yet been announced by Uber about the division of labor between Kalanick and the new COO, the hope is that new discipline brought in by the COO will help button up and repair the company’s image, starting with the CEO.

Chief of Staffs for planning, systems and more

Another option—and this is more frequently being adopted by mature startups—is to hire a Chief of Staff, rather than a COO. Similar to a COO, the COS has a mostly internal focus but a wide-ranging charter to help accelerate growth and efficiency. See this interesting article that describes the popularity and role of Chief of Staff at startups. For more reading about COOs at startups, check out this cool article on Medium from 2015, including a nifty list of related articles on the topic.

Posted On March 7th, 2017 by Crowded Ocean

How much time do you really have to pitch your startup?

In the process of researching our book, The Ultimate Startup Guide, we interviewed a wide range of VCs—some of whom we’ve worked with before, some of whom we knew only by
reputation. As we collated our notes by topic, there were a couple of back-to-basics takeaways that stood out.

The first had to do with the nature of the relationship you’re trying to cultivate.

The second had to do with how much time you really have to pitch.

Every single startup founder and VC partner stressed the long-term nature of the VC-startup relationship and likened it to a marriage (or family in some cases). The idea is that you’re in this relationship together for the long haul, so choose selectively. Founders will mistakenly focus on valuation or the term sheet and the brand name of the firm ignoring components like the stature of the individual partner within the firm, their capacity, domain expertise, individual track record and their potential to build rapport with you. This isn’t a marriage solely for economic gain.

You’re getting hitched

This is a marriage you are entering “soberly and advisedly” where the capacity of the partner to build trust and to guide and mentor you, the startup founder, is hugely valuable and not to be underestimated.

And you’re going to be in bed, so to speak, with your VC investor for a long time. As this Forbes article pointed out, according to the National Venture Capital Association, the median time to IPO exit since first funding for VC-backed startups was 3.1 years in 2000, and 7.4 years in 2013.

The second takeaway has to do with how much time you really have to communicate your new idea. The reality is that even though many VCs leave their laptops and phones outside the door (to show the startup that they have their undivided attention), they have their pad of paper…and they are human. More importantly, most VCs will cop to having some form of ADHD: they’ve got all their current portfolio companies as well as the ones they’ve recently met with that they’re considering funding. And they probably have three more meetings after yours. So there are a lot of places their mind can go while they nod at Slide 28 of your presentation.

Plan on just 10 minutes, even if you’re booked for an hour

Therefore, even though the meeting you’ve booked is 60 minutes long, you should plan on 10 minutes of attention. (Sequoia partner Aaref Hilaly advises founders here to plan to hook your audience in the first 5 minutes of the meeting.) The point is that you need to engage quickly and powerfully and leave plenty of time for discussion. Pro tips:

  1. Make the meeting more a conversation than a pitch. Check in with the VC early in the presentation (as early as the 5-minute mark) to ensure engagement.
  2. Lead with the opportunity for the VC—not the dreaded ‘About Us’ or ‘Market Share’ slides. Why should they invest—what’s in it for them?
  3. Plan on bringing your product to life with visuals, screen shots, maybe a mini demo.
  4. After you’ve established that the market opportunity is Trumpian “yuge”, keep the detailed market metrics in the appendix.

For more insights into the “pitch and ask”, take a look at The Ultimate Startup Guide, available now on Amazon, Barnes and Noble and more. And here’s a review of our book that appeared last month in Inc.

 

Posted On January 24th, 2017 by Crowded Ocean

Walking in Another’s Shoes: Sales/Marketing Integration

Sales and Marketing may not be from Mars and Venus—or descended from the Hatfield and McCoys—but they aren’t natural allies, either. Sales carries the burden of a quota, screen-shot-2017-01-23-at-7-22-38-pmand when that quota isn’t attained, Sales will sometimes look for someone to blame. Maybe it’s the product (we’ve over-promised performance, ease of use or implementation, or we’ve mistakenly omitted key features), but more often it’s Marketing (our messaging is wrong; our claims are unsupported on the website; we don’t have enough leads—and the ones we do have are for shit).Screen Shot 2015-02-23 at 5.27.57 PM

Without sounding too much like Dr. Phil, the solution to this gap is ‘empathy.’ And the CEO has to steer Marketing towards being the one to take the first step in building an integrated sales and marketing plan. An easy first step is to have every person in Marketing listen in on an Inside Sales call. Or better yet, move their desk to the middle of the Inside Sales bullpen so that they can let these calls wash over them, even if they’re only hearing half of the conversation. And, when geography and budgets permit, have everyone in the company—nerds included—go out on a sales call.

Insist Upon Weekly Sales & Marketing Meetings

The next step is organizational: have someone from Marketing sit in on the weekly Sales meetings. Or better yet, have a regular meeting between the Sales and Marketing principals, with representatives from the lower ranks of each department participating and presenting (and listening) where appropriate. Make the content of that meeting both qualitative and quantitative. What can Sales report, fresh from their latest customer interactions and pitches, and what does the data-driven Marketing team report?

Once Marketing takes the initiative, it’s up to Sales to reciprocate. Sales needs to recognize how important, for example, reference accounts are—for the website, for PR (you can’t do a launch without customers that the press and analysts can contact) and for sales collateral (case studies). And if referenceable accounts aren’t part of a sales person’s quota and goals, they should be.

Screen Shot 2015-02-10 at 9.04.47 PMMeasuring the Cost of Customer Acquisition

Thanks to digital marketing systems like marketing automation tools, CRM, as well as a myriad of website tracking tools that help measure conversions of inbound traffic to your website , Marketing can now see both the quality of the leads it generates and what Sales is doing with them. This kind of collaboration between Marketing and Sales, fostered and modeled by the CEO, will enable your startup to answer the essential question: “what is the customer acquisition cost?”

Understanding Marketing Contribution to Sales

We’ve never met a startup that has modeled Marketing contribution to Sales. Startup CEOs will say instead that they want their Sales team to be much more productive, and that they want those productivity gains to be derived in part by having the right marketing programs and content to build market awareness for their company and customer preference for their solution.

Does all of this mean that the lion will suddenly lie down with the lamb? Nope. But it gives each party a solid understanding of the other’s jobs and pressures, which is a great start.

Posted On January 10th, 2017 by Crowded Ocean

Market traction and market momentum: are they the same?

Successful VC investors are famous for wielding the power of their intuition or gut instinct when assessing a startup founder or her company before making an investment. That little challengesvoice that speaks to the VC investor about a hot opportunity is also informed by due diligence on the market size, team and growth.

A company on the move…

A startup that can demonstrate market momentum is a positive sign for investors. But, market momentum is generally largely qualitative. It’s that quality of a company “on the move” that’s largely unsupported by any graphs on charts but is still an indicator of market opportunity.

Market traction = market adoption

Market traction, on the other hand, is quantitative and it’s based upon real indicators of growth and market adoption.

Angel List co-founder Naval Ravikant describes market traction as “quantitative evidence of market demand.” In other words, do customers want your product? When it comes to an early-stage company, VC investors will take a measure of a company’s traction using private market data that go beyond publicly available info like the track record of the team, market size and financing rounds.

Quantitative evidence of market demand

In the absence of traditional metrics like average deal size and the true cost of customer acquisition, non-traditional measurements like share of voice, website traffic and social media growth and engagement do shape market traction of an early-stage company. Take note, startup founders! A focus on growing social media engagement can favorably affect the perception of your brand, but also of your market traction.

book-cover-largeOf course, quantitative growth and trends do count. Growth in average deal size, for example, is an early meaningful signal of market traction. Showing that you understand the sales cycle of your business and that it is shrinking is another meaningful early signal of market traction.

Bottom line, demonstrating market traction is the way to de-risk the idea of “more” (investment, hiring, partnerships, office expansion, etc.) for your stakeholders and investors. You can always celebrate market momentum, but what matters more is measuring market traction.

 

Posted On December 28th, 2016 by Crowded Ocean

Book excerpt: how to launch a startup by Hogan and Broadbent

Our new book, The Ultimate Startup Guide, is launching January 23, 2017. That’s less than a month, people! Check out an excerpt from Chapter 15, “Launch” below. It was originally published in VentureBeat.

Screen Shot 2016-08-12 at 8.04.28 PMEveryone in Silicon Valley has their own theory about how to launch a startup. There’s the “Soft Launch,” the “Rolling Launch,” the “Steady Drumbeat Launch.” You get the idea.

Then there’s the founder who brags that he didn’t spend a dime on marketing and sold his company for a gazillion dollars (that rarity — of which WhatsApp is a great example — is responsible for more company failures than we can count).

But for 98 percent of us — the ones who haven’t caught the market at the perfect time with the perfect product — there is “The Launch.” It’s your coming-out party, the milestone that moves your company officially from stealth or “in the bunker” into the public marketplace with a generally available product. In other words, this is it. Don’t screw it up.

To make the most of that once-in-a-lifetime opportunity requires planning, care, collaboration, and creativity. Even in the era of The Lean Startup, with its iterative approach to tuning your product feature set and product applications based upon active customer feedback, nailing the official debut of your company is a huge deal. It’s possible to survive a botched launch but not likely.

Some startups launch to “legitimize” their business in the eyes of customers and potential investors. Everything that takes place prior to your launch — even if you have a preliminary website — can be regarded as trial and error. Typically, your launch is your announcement to a wide variety of audiences — customers, investors, market analysts, the press, the competition — that you’re serious and open for business. You’ve polished and defined your market message through components like your website, sales content, and PR. Perhaps you’ve even upgraded your office space. All because customers want to do business with a brand they trust, one that they believe has staying power. Same for the next round of investors. Same for employees. Every startup wants to look larger than they are, and an official public debut (including favorable press coverage) can go a long way to achieving those business goals.

There are other reasons to launch. Some startups will tell you that their launch was key in attracting the right talent to build their team in a competitive job market. Others say that, post-launch, they were approached by investors or potential partners who wouldn’t return their calls prior to launch. Bottom line: Your launch is about investing in getting your story out into the marketplace in a powerful, differentiated, memorable, and unified way in order to connect with stakeholders so you can grow your business and scale your company.

The soft launch

In contrast to a one-time, major launch, some companies will choose a soft launch, which is usually phase one of a two-phase launch that involves a greater focus on the company than on the product. It may focus primarily on the founding team, its market space and the funding it has received. It may also involve a limited release of the product but without significant details.

When is a soft launch appropriate? Here are four reasons to go that direction:

1. Recruiting.  Startups, especially in the super-heated and super-competitive job market of Silicon Valley, will often soft launch in order to use the visibility it generates to be able to recruit top talent to build out their team.

2. Competition. A startup may believe a competitor is going to beat it to market. In order to be first – to define the market on its own terms and to set the stage for why its technology is superior – the startup will launch in two phases, with a soft launch intended to blunt the competition and relegate them to second-to-market.

3. Buzz-building. To be the shiny new thing in tech, even in a less sexy, geeky market segment, can be a very valuable, momentum-building period. Social media and press buzz can help a startup accelerate recruiting, fundraising, and customer development.

4. Enterprise-ready. Large enterprises are more sophisticated these days about the value of new technology from young startups. But that doesn’t mean they want to risk a vital portion of their IT operation and budget on a product from a newly minted startup. But, the market validation and favorable coverage by analysts and press of a soft launch can convey a great deal of legitimacy to a young startup that can help it close pivotal deals with early-adopter, brand-name enterprise customers.

The un-launch

Companies like Slack and WhatsApp have famously boasted that they spent next to nothing on marketing, that they never launched, that they just released their new product “into the wild” to gauge public reaction. This strategy is one that has worked well for a very select group of startups. It’s not a “thumb your nose” strategy, where the company is deliberately flaunting established market presence. Instead, it’s an experiment that goes so well that it obviates the need for the traditional launch. So if you want to go that route, take your shot. Just remember that press and analysts do their research, and if you come back to them because there was limited market response to your “un-launch,” they normally won’t cover you, since you’re yesterday’s news.

The serious launch

You need a lot of things lined up in order to launch. Here are the key ones:

Launch leader: The heart of every successful startup launch is the cross-functional team chartered to build the story and tools to put your startup on the map. While marketing is in charge of the launch, it’s an all-hands effort, with the founders and representatives from product, support, and sales joining the marketing team to craft the value and benefits of a new solution that solves a real pain point.

While everyone still has their day job (finalizing product, supporting early customer trials, and staffing critical job functions across the company), the launch will only come off if it is Job One for the entire company. To that end, we recommend creating the position of Launchmeister and telling everyone (founders included) that during launch period everyone (again, founders included) reports to the Launchmeister. Without that commitment you’ll either miss your launch date (which looks bad) or produce a half-ass launch (which looks worse).

We’ve covered who should be involved in the launch. There’s also the matter of who shouldn’t be. When board members, or well-meaning investors (or the founder’s spouse) start chiming in to “help” with such launch items as messaging, materials, or taglines, that’s problematic. In fact, when we see board members dropping into the startup’s offices frequently prior to launch, it’s usually a red flag.

PR: An important goal of any launch is favorable media coverage. Which means investing in PR. You’re going to need PR earlier than you think — and pay more for it than you want. By “earlier than you think,” we mean that, ideally, your PR agency has been in on the positioning and messaging process from the beginning. Ideally, they’ve even been a participant in the process, giving their feedback on what their market — analysts, press, and market influencers — will accept/believe and what won’t play with them.

This is also the point at which you find out how good your agency is. In launching as many startups as we have, we’ve worked with too many PR agencies to count. And the most important thing is to have an active partner in this process.

Product: Unfortunately, almost every launch will hit a snag. If a launch date slips, it’s usually one of three reasons: product issues, customer problems, content delays. Products have a nasty habit of taking erratic paths to completion. In the technology world, the unstated expectation is that products will slip at least twice on their way to market. Plan accordingly.

Customers: The union of product and customer — especially in early days — is a delicate one. On the one hand, early adopters are pioneers, willing to take on an incomplete product so that they can play an active role in its finishing. But early adopters are also notoriously squirrelly, sometimes working without the knowledge or approval of their company. So, we have a rule of thumb: We won’t launch a startup unless/until it has three referenceable customers — people who will take calls from press and analysts and say glowing things about their experience with the product, both in its current state and long-term. There are exceptions, such as the secretive cyber-security market, where getting companies to deliver a public “testimonial” is problematic. (Press, in particular, won’t write about a product without a customer as reference; they’ve been burned too often by company claims about their product that simply aren’t true.) The reason for requiring three is that there’s at least a 50 percent mortality rate of referenceable customers due either to product malfunction or company policy about talking to the press.

Content: In today’s arena of immediately available online information, the adage that “you can never have enough content” is true. It’s true for your website, simply as a means to make it richer (keeping viewers on-site longer, building brand loyalty), but it’s even more true for your sales efforts. These days, unless you’re selling an impulse-buy product, you need to nurture your prospects. It’s estimated that the normal enterprise sale requires 5-7 interactions (or touches) with your prospect. That means, unless you want to approach them empty-handed, with nothing new to justify the contact, you better have 5-7 pieces of content (it could be a white paper, data sheet, a demo video, a copy of your CEO’s latest article, a new blog on topic, etc.) available at launch and beyond. So don’t let your launch be delayed — or incomplete — because of a lack of content.

Demand programs: In the run up to launch, we recommend that your launch team develop at least three months of demand generation programs so that you have some “canned” programs available subsequent to launch that can help turn the increased awareness and interest generated by launch into sales leads. Otherwise, you run the risk of allowing all of the visibility, brand awareness, and site traffic from early adopters that respond at launch to go unleveraged.

Measurement: On the quantitative front, look at the conversions that were planned into the website and whether you are actually seeing the signups, downloads, and registrations you were aiming for. On the qualitative front, it’s about what the sales and customer support/success team are reporting. What are they actually hearing in conversation with customers and prospects, live and on social media? And does it validate or contradict what the data from your website is telling you.

Posted On November 29th, 2016 by Crowded Ocean

Why would a startup hire an inside sales rep a year before product availability?

We’ve seen two successful enterprise startup teams hire inside sales reps during their stealth phase, early in the life of the company. moneySo early, in fact, that the hire preceded the general availability of product by more than a year. And the ISR was not even related to a board member or cofounder! So, why hire so early?

Two reasons.

Early traction

First, the ISR helped extend the reach and productivity of the startup team by cold-calling potential early-adopters while using the name and bona fides of the founders and investors. The ISR worked off of a list of friends-and-family targets and helped hunt critical early customers. As the mantra of company building goes, rapidly building the MVP product with fast iteration of core features that are based upon customer testing and feedback is the shortest path to establishing product/market fit. In this model, the ISR served as an indispensible wingman of the founders whose credentials are part of why the lone-survivorstartup was funded in the first place and why an early-adopter customer would take a chance on an unproven product and company.

In reality, the ISR runs an early focus group

Second, because the ISR is on the front lines of pitching the company every day by phone and email to would-be customers, they serve as a test bed or focus group of value propositions, terminology and product names. One of our past startup clients, for example, formed a three-person ISR team who A/B tested email subject lines that they used to set meetings in the year prior to the official beta release of their cloud service. The ISR team tabulated their findings which became useful data for us to consider when we worked to nail down product positioning.

So, consider the value of adding a strong Inside Sales Rep before launch to help extend the influence of the founders, accelerate sales and help test your positioning and messaging.

Posted On October 18th, 2016 by Crowded Ocean

Is “momentum” part of the secret sauce of startup success?

When a startup team is heading into launch, ‘momentum’ can be that intangible ingredient that helps fill in gaps in execution, blurs missteps and invigorates a team that is flagging from staff shortages, high expectations and competitive pressures.

moneySuccess, according to the “Yoda of Silicon Valley”, Sam Altman, CEO of startup accelerator Y Combinator is:

something like idea times product times execution times team times luck, where luck is a random number between zero and ten thousand.”

In other words, who the hell knows. Or, if someone did know the secret to a winning startup, there’d be an algorithm for that.

This recent article in the New York Times contrasts the rising “mojo” of social media favorite Snap (the channel formerly known as Snapchat) to the tumbling fame (and valuation) of Twitter. Not too long ago (before we moved to a new slugfest) it was Google vs. Yahoo or Slack vs. Hipchat. The point that matters is that momentum can be a powerful force that helps accelerate success in startup teams.

So how do you foster momentum across your team? From our vantage point as CMO guns-for-hire, teams with momentum share a few basic attributes that are always modeled by the founders. These may not be all of the steps to momentum, but they are our top favorites:

  • Goal setting: Everyone on the team knows what the company goals are and how their own job goals support those goals.
  • Accountability: Maybe it’s an individual or maybe it’s a team but there’s an owner for every deliverable and it’s understood across the organization, from top to bottom.
  • No excuses: When mistakes are made, they are acknowledged and the team pulls together to fix them and move on. No finger pointing. No blame.
  • No assholes: When there’s a new-hire who’s a bad fit, culturally, or who brings a toxic style to the office, they never last long. Mistakes in hiring happen, unfortunately. But life is too short to tolerate them.