Pilots, pilots, pilots
Pilots and trials are the lifeblood of B2B startups in the early innings. The process of earning and executing a pilot (or series of pilots) can lay the ground work for a successful product and sales process. Speaking to one of our accelerator partners, it became evident that many founders lack awareness of the process and what to expect. I hope the below discussion can provide some guidance to founders looking to land a large corporate client.
The beauty of pilots is that the process encapsulates customer discovery and sales, all-in-one. Early-on, large startup-friendly corporations tend to make available resources to help founders better understand their problems. This is a great way to “prime” the sell and make them feel a part of the ideation and implementation of a cutting edge solution. Once requirements are met or there is understanding of your roadmap (never build solely for one customer), pilot discussions can begin.
What to Expect
Depending on the size of the organization, it’s not unusual that a startup would need to run several pilots across various geographies and business units — this can take +/- 12 months. The reason for this is to not only make sure that the solution adds value, but also to make sure it can scale across a large installed base.
- Customer/problem discovery
- Pilot #1 1
- Pilot #2
- Pilot #3
- Broad business unit or division
- Organization-wide negotiation of MOU/Contract
As a result of this dynamic, founders should view large corporations as a battlefield. Teams need to land and expand. It should be expected that the initial pilots will be the most challenging — test to see if the product can handle the most complex needs — the latter opportunities, less challenging. The best founders religiously execute on the opportunity at hand.
Given the lengthy nature and scope of investment required in a pilot program, founders should make sure they have explicit permission to mention a brand in their BD activities. It’s not a necessity to have a large, signed client for them to serve as a reference customer. Leverage the reputation, support, and network of early customers to build your sales. Given the relatively low margin nature of pilots, this a form of payment that can yield more-immediate rewards.
I expect I’ll be writing more on this topic as the months pass given we optimize around pilots in our Accelerator program. Pilots are a giant step towards building a business with strong fundamentals (which starts with quality top-line growth).
- On the fringe, an extremely successful pilot (crushing the KPIs) could allow a founder to justify a faster roll out