876 karma · joined February 2, 2009
find me here: @paulsingh email me here: paul [at] resultsjunkies.com
Disclaimer: I run the accelerator program at 500 Startups (and we've invested in a handful of Startmate companies) and this is the same advice I give our portfolio.
(I'm from DC and am on the investment team at 500 Startups.)
Feel free to email me directly if you need anything -- should be in my profile.
tl;dr - if you're selling B2B, you're not going to get anywhere unless you can reasonably convince someone that you'll save them time, money or (ideally) both.
In general, I spent a lot of time cold calling the first users and gave away the product. There was a lot of back-and-forth about what sucked, what I had recently fixed, etc.
In both cases, the first users helped me understand quite a bit about how I was going to have to scale the sales operations... for example:
With MailFinch, one of my original assumptions was that real estate agents would want to use it to send out all the weekly flyers that they usually send out. So, I first asked all of my friends in the DC area to send me their local newspapers -- I spent a weekend circling all of the real estate ads that were larger than 1/2" (if they're advertising in the newspaper, you can reasonably assume they have money and have some understanding of marketing). I then cold-called the hell out of these people and learned two things:
1. I was right -- they send an average of ~100 flyers each week. 2. They would usually hand me off to their assistant (!!!)
That second item was important -- I didn't need to sell to the agent directly, I needed to call their office and talk to the assistant or office manager instead. I talk about this in detail in my Mixergy interview last year (which is now behind a paywall): http://mixergy.com/mailfinch-paul-singh-interview/
With NotaryCRM, I actually convinced one notary (my mom) to start using it for her side work. Then got my wife to use it. Then one local notary that I cold called. From there, I learned pretty quick that notaries talk... a lot. If I had a bug, everyone started bitching simultaneously. As the product got better/prettier/more useful, everyone started loving it simultaneously.
The big breakthrough was realizing that there are two good channels to reach this market:
1. Cold call the notaries (there are huge directories for this now) and convince them to signup for a free account -- this is generally hard, but I did a lot of it early on. 1a. Make sure you ask for referrals on each call, email, meeting, whatever -- "do you know any other notaries that might find this useful?" Notaries are regular people. And regular people want to seem "in the know" with their friends. If they loved NotaryCRM and referred it to their friends, they generally looked good. Totally serious about this. :) 2. SEO works... especially in niches like this. Checkout notarycrm.com and click on the "Find a Notary" link. I could probably write a huge blogpost about this but the gist is that notaries are searching for their own name -- all the damn time. It also helps that they usually suck at SEO... so it didn't take long for me to put together a directory that came up at the top of the SERPs for their own name. Once they click through, there is a big call to action that says "claim this account" if they haven't already. Again, lots more I can say about this but it might be offtopic from your original question.
So... I hope that helps. :)
Near-term plan is to spend this week building out the reporting interface and spreading the word.
For #1 & #2, I'm hoping that using Dave's AARRR methodology will allow me to apply a somewhat consistent framework across a variety of startups.
For #3, you're absolutely right -- it's a big problem (and I haven't even thought about it yet).
So, any chance I can get you to try this on geckoboard itself? :)
Someday, I imagine that I'll have a set of public pages where you can actually see "baselines" of what basic conversion rates look like for saas/hosting/consumer/whatever companies.
Fundamentally, I just want to see a bit more transparency. Startups shouldn't have to operate in the dark.
I'd like to fix that with this.
seriously, thanks!
Beyond that, we've got a couple of ideas that we'll be testing out -- maybe selling a brandable widget-based version to businesses, affiliate links, etc.
Not sure what will end up working but I can assure you that we'll be iterating pretty quickly. :)
Polish coming soon, promise! :)
The article implies that Hammerbacher left Facebook before starting Cloudera... is that actually true? I imagine that Facebook might have said, "Whoa, hang on now -- you wouldn't have gained that experience anywhere else. We want a piece of Cloudera!"
I'll post a note term sheet that I raised money on last year once I find it but notice the prepayment clause here: http://startuplawyer.com/convertible-notes/convertible-note-...
When you're raising on a convertible note, you're essentially taking a loan from the angel. You're promising to "pay them back" at the next financing by converting their money into stock equal to the principal + interest they've accrued on that note. If you really wanted to (and the term sheet doesn't preclude a payback), you could pay them back for only their principal & interest instead of converting them to stock.
However, most angels may not be too happy if that was your plan all along. They're putting money in on the hopes that your success will somehow multiply their money. If you're just planning to pay them back their interest, they might as well have put that same money into a bank.
Again, it really depends on your angel -- my strong advice to you is to be forthcoming about your goals. It's better to have everyone on the same page up front... especially if you plan on having a long term relationship.
I'd love to talk to your friend. :)
It's profitable and, on most days, pretty fun. :)
Consider taking this gig. As an internship, I suspect that it's going to last 3-6 months. Yes, the commute sucks but I suspect you'll learn something far more important:
1. How users react to systems that geeks/engineers put in place.
2. How to talk to non-technical users (who, I assume, are the likely callers)
I did a short stint at a helpdesk many years ago and it certainly helped me learn how to talk to non-technical people. (I also did two summers selling cars at CarMax which, IMHO, was a fantastic way to learn how to sell yourself to anyone.)