Enterprise customers taking risks on startup products

In April I noted a few odd questions prospect customers asked me after sales pitches. A TC post written several days ago confirms my dataset isn’t the only dataset.

Enterprises are becoming more aware of startup behavior and formed new due diligence questions and processes to combat the risk. Selling a new product is no longer about the product anymore, it’s also about the confidence in the startup’s business.

Now, the biggie: If large enterprises continue to ask these new diligence questions, how is the new age entrepreneur to survive?

In short, there’s no way around answering these tough questions for startups; enterprises have every right to ask them and SHOULD. A startup’s only tool is the relationship that’s built with the customer. The customer needs to trust the startup and there’s no worse way to build that trust than lying and puffing your chest from the start.

I think the real issue startups now face is around growth. If the startup needs to spend more time building trust (so they can make the sale) incremental sales are harder to come by.

In order for the startup industry to thrive, all its constituents need to understand the new behavior. Investors need to understand growth metrics are different and customers need to understand in order for the business to be secure they can’t suck up all the startup’s time. Enterprises should evaluate the product and business as quickly as possible and make a decision.