To Grow Fast, You Need Outbound. Here’s Why:

Proactive Growth Leads to Growth Velocity
© Control Alt Deceit: A Game of Lies, Betrayal and Questionable Business Strategies

Imagine this: Your team decides to focus on a segment in the farming industry. Maybe your company goes through a complete rebrand, uses some of the value propositions learned through discussions with prospects, but nothing really changes in terms of marketing strategy and acquisition channels.

How long do you think it takes to get 10% of the market?




If you’ve truly nailed a niche, you’ll eventually get there through referrals and a bit of luck, but it will probably take a lot longer than you initially anticipated.

If the market is real (Read: What a Market Is and Isn’t), customers will reference each other when making a buying decision, and word of mouth will amplify your growth efforts.

But there first needs to be something to amplify.

To capture your beachhead market, you need to focus on growth velocity; this means speeding up (product) discovery by prospects within your target segment (farming!).

If you keep on relying on customers finding you and organic growth, you’ll have a hard time reaching the necessary velocity for market dominance.

That’s why you want to switch to a proactive growth strategy.

Proactive Growth & Growth Velocity

When you seek out and target the exact customers you exist to serve, you can focus your resources on leads that convert. You also don’t have to build the wrong thing to accommodate the wrong customers.

Now, the good thing is that almost all markets self-organize into groups. LinkedIn groups, meetups, trade groups, conferences, ad hoc communities on blogs or forums. Or maybe, they have common suppliers, or they advertise in the same magazines.

If you understand where your market’s attention is, you can make real headways.

Figure out where they hang, what they read, where they go.

Analyze their networks. Reverse past sales and acquisitions. How did your best customers find you? Can you repeat that?

You have to find the reliable and predictable parts of your model and double-down on those.

Now, the issue is that not all channels and strategies can work for this.

In a great talk, Growbots founder Greg Pietruszyński explains the different options for founders early on. He says:

  • Marketing – like content marketing and brand – takes years. It’s not the easiest thing to start with.
  • Paid advertisement can work, but it’s expensive.
  • Organic growth – like search engine optimization – can also work, but it’s hard to get effective results early on.
  • Outbound like outbound sales or cold emailing is typically the fastest way to get in front of targeted prospects and customers.

You have to think of marketing, sales or acquisition channels in two ways:

  1. Can this channel allow us to directly reach prospects from our market?
  2. If it works, can we scale it?

Scalable Sales & Acquisition Channels for B2B Startups

Realistically, you could start by doing things that don’t scale, capturing visibility on communities, blogs, forums and speaking at targeted events while slowly transitioning to more scalable sales and acquisition strategies like:

Seach Engine Marketing – promoting your product on search engines like Google, Bing or DuckDuckGo. This is how Lightspeed POS and Vidyard got their starts.

Social and Display Ads – advertising on Facebook, Twitter, Instagram or LinkedIn. That’s how LANDR acquired a lot of its users. It’s also how got started.

Outbound Sales – proactively reaching out to ideal customers via phone or email. That’s how Zenefits and gained momentum in the market.

Existing Platforms/Distribution – Sometimes partnerships can work. And sometimes you can also leverage an existing platform used by your target market. That’s how Evernote and Airbnb got their start.

Growth specialist Brian Balfour says: “We always build our businesses off the back off someone else’s platform.”

That’s not false.

One last option may be what people in SaaS call “Engineering as Marketing” – building free tools or products solving the needs of target customers to gain traction and visibility. It’s a good way to position your brand as being ‘helpful’. It’s how HubSpot and RJMetrics found initial traction.

You need to experiment, find a system that works for your unique product/market combination and repeat it ad nauseum.

If you get it right, word of mouth will amplify your efforts creating a flywheel as you reach the right growth velocity.

A fragmented market – or many small markets – don’t make a big market. You might need to reinforce your beachhead market or create the channels for them to communicate if they’re not readily available, but that’s a risk. You have to make sure your beachhead is a real market first and commit.

In all scenarios, proactive growth leads to growth velocity. But proactivity is not enough on its own.

In an upcoming post, we’ll look at how founders can create company focus around growth. Sign up to our newsletter and get notified.

How to Find Your First Customers When Your Startup is Ready to Sell

The place you should start any Complex Sale is the place where you have the greatest degree of credibility. – Robert Miller and Stephen Heiman, Strategic Selling Authors

You met with a lot of stakeholders in the business. At what level do you start selling? Do you sell high to executives? Or low to the management staff? How many people in the organization need to say yes in order to make a sale? In what order do you need to contact these people?

To analyze which prospects are more likely to buy, you must understand their company’s situation. There are four situations an organization can be in:

  1. The company is in growth mode. They seek optimization looking for more, better, faster, nicer, etc.
  2. The company is in trouble. They wish to bridge the gap between reality and their business objectives.
  3. The company is satisfied with their current solution. They — wrongfully or not — perceive that their current solution meets their objectives.
  4. The company is over-confident. They over-estimate the situation they’re in, misreading the trouble they’re in.

People buy when, and only when, they perceive a discrepancy between reality and their desired results. – Robert Miller and Stephen Heiman

Although it is possible to sell to a company satisfied with its current situation, your first customers are more likely to come from companies seeking growth or a way out of trouble.

You must understand the roles of your prospects to avoid barking up the wrong tree. Would they be the ones buying the solution or help influence others to buy?

Why Your Early Pricing is Wrong (And Why It Doesn’t Really Matter)

“Pricing is all about setting the right perception.”Neil Davidson, Don’t Just Roll the Dice Author

A pricing model is one of the business assumptions that changes the most.

The price you choose initially will certainly be wrong, but it won’t be final. You can mark this loss of profitability as a tax on learning.

Early on, your real goal with pricing is to make sure that money changes hands in sufficient quantity to validate that a business is worth building. Once you have that, you’ll work your way to a more just value-based price, based on the perceived or estimated benefit to the customer rather than the cost of the product.

Your pricing sets the value (or the perception of value) of your product. In the same way that luxury products use price to brand themselves above the market, B2B pricing determines who your economic buyer will be and sets the expectations for the Return on Investment (ROI).

Taleo, for example, used pricing to position its product as a high-end recruitment solution, pricing their products at a level that almost only large companies could afford.

But, pricing above market adds complexity to your Product-Market validation. In general, you should target budgets that your company feels comfortable pitching for.

If you were able to collect information about the purchase authority during the Problem interviews, you can already tell if your pricing will be within range or if you need to go higher up in the company.

Understanding Signing Authority

In general, the lowest level of signing authority — the amount that can be purchased without asking for special approval — in a company is $500 to $1,000. If you’re priced just $1 too high, sometimes it requires the next level of management to sign off.

EXAMPLE OF SIGNING AUTHORITY IN A LARGE COMPANYExample of Signing Authority in a Large Company

Companies have formal structures with many stakeholders controlling budget to avoid fraud.

Based on their roles, levels and responsibilities, the people you’ll interact with may have very different signing authorities ranging from $500 to $25,000 and above. Selling above the signing authority of your prospects typically complicates and prolongs sales cycles.

Beware, start with one product, one benefit and one pricing model before you start thinking about how it should evolve. Early on, it’s usually best to keep things simple.

More on Early Pricing