Who's qualified to close the sale?
As a seed investor, I meet with pre-product, pre-revenue startups every day. One of the more important questions I ask of them is about their go to market strategy. Who’s going to sell this thing, and how?
Recently, I’ve been surprised by how many times I get answers that involve partnerships, channels, resellers and other indirect means. The answers surprise me, because almost all of my portfolio companies have tried an approach like this over the years. And the success rate...rounds to zero.
There’s some important caveats to note with any observation as categorical as I’m making. First, I’m a seed investor, and I spend my time with companies that have yet to achieve product-market fit. Second, I specialize in high cost, deeply technical software products. It’s entirely possible that channel strategies work for startups with different characteristics. But in my market? Nada, zilch, nothing. At least I haven’t seen it.
What does work when it comes to selling software into a brand new market? Some of my portfolio companies build a high volume, carefully measured outbound program around SDRs. Some rely on the founders’ deep industry relationships to open doors at the first dozen accounts. Others build content marketing and thought leadership from the start to drive inbound. Approaches vary by industry, competitive intensity, and annual contract value.
In all successful cases I’ve seen, agency and accountability remain internal. Your partner’s sales reps are not going to lose their job if they fail to sell your product, nor are they going to get a promotion if they somehow accidentally sell a ton of your product. But your team, who have nothing to sell except your product, do have that level of agency and accountability. You as founders, and your early sales team, are also the only true keepers of the secret about how magical your product is. Only you are qualified to tell the world about this secret. Only you can convince someone to buy some weird new kind of software from a startup no one’s ever heard of that can’t even afford a dotcom domain name.
Closing the first few sales is hard, and it’s only gotten harder as each software category fills with competitors and each acquisition channel gets more saturated. If there were an easier way, if there were some magical shortcut to get your product into the hands of prospective customers, it would indeed be wonderful. But I haven’t seen it. The hard way remains the only way.