Photo by Matt Botsford on Unsplash

Why Selling is the #1 priority for your startup

And a little on how to get there faster

As Steve Blank likes to say, “Get out of the building.”, I like to say, “Sell your shit.” Or as Reid Hoffman likes to say, “You’ve launched too late.”, I like to say, “You’ve sold too late.”

The hard thing to do is sell your shit. Sell it early. Sell it always. Sell. Sell. Sell. Because in the very beginning, anything other than selling is leaving your business in the “default dead” category.

While there are plenty of aphorisms on building product like, “Love your customers”, “Make sure the user experience is great.”, “Build a product people love.”, most businesses are not going to become unicorns, so you can’t afford to play the unicorn game of ignoring sales.

But you might say, “I’m not good at sales, or I don’t know what I’m doing?”, and I will ask, “So you don’t care if your startup lives or dies?”

Regardless, the notion of most founders not being good salespeople is not new. However the absolute magnitude of selling your product in the very beginning cannot be overstated.

Big List of Reasons

This is a semi-exhaustive list of reasons why having “selling your product” as anything other than the #1 priority is dooming yourself to failure.

Before you read the rest of the reasons, understand this: If there is no skin in the game, there is no motivation or incentive to succeed. This is for both you AND your customers. Without skin in the game you have a very hard battle to overcome and does not happen often. Do not delude yourself. When you sell your product you create “Skin in the game” for both yourself and your customer. This is where you want and need to be.

Now for the reasons:

Product

1. Prioritization: This is a no brainer. Customers that are paying for the product will typically have much different expectations for your product than customers that aren’t paying. A user that’s just using the free tier will want different things than the person paying $20 / mo. (What’s funny is how this can be the same person before and after paying for you product.)
2. Usage: Who uses the product? Is the person who paid for the product and the daily user a different person? This is information you need to have in order to build the right product.

Engineering

1. Prioritization: Same as Product, but for allocating resources to building. Do you build a new feature? Or make an old feature even better?
2. Usage: Are your free users all on Chrome, but your paying users all on Internet Explorer? Are your free users on iPhone but your paid users are on Android? These are examples of very serious engineering design considerations that can help you reduce technical debt for the future.

Sales

1. Price Sensitivity: You don’t know what your customers are willing to pay until you tell them the price and then ask for a credit card. They will either laugh at you or pull out their credit card.
2. Pricing Strategy: When you ask for $10 / seat and the customer says, “How about $100 / month for unlimited seats”, AND THEN TAKE THEIR CREDIT CARD, you figure out how your customers want to buy.
3. Decision makers: Who pulls out their credit when this type of decision needs to be made? If you don’t ask for a credit card, you never find out.
4. Sales Cycles: How fast are deals being made? Where you able to close the deal in one phone call or did it take 2 months and 15 phone calls? This information is invaluable to understand the viability of your startup.

Finances

1. Unit Economics: Do your unit economics work out? Do your Sales Cycles balance out with LTV, Cost to Service, and CAC?
2. Raising Money: When you raise money, you’re going to need a good story. What’s the better story? “In 2 months we have 50 paying customers at $50 / month and expect to 3x that by next month because we both just quit our jobs and are working on this full time now.” or “In 6 months we’ve got 1000 users, but no one is paying us, and most have disengaged.” This is drastic, but a story with money is much better than a story without money.
3. Retention: Ironically, customers that pay for a product are more willing to stick with a product because they have skin in the game. Just think about any time you said, “Well I paid for it, so I’ll go (or eat it, or stick with it, or not delete it, whatever).”

Support / Customer Success

1. Service costs: Do paying users need hand holding and personal onboarding or are they savvy enough to figure it out themselves?
2. Retention: When are customers cancelling? Why are they cancelling? Customers that paid for a product will give you semi-honest feedback on why they’re cancelling. Having personally worked in a call center to save customers that were cancelling, most customers will lie to you, so you NEED to probe further. Then do everything you can to try to keep them. This will help you understand what they needed to stay, and help you learn what’s truly important to the customer to keep them.
3. Retention part 2: Free users can’t “cancel”, so they just stop using it. If a paying customer stops using your product, but doesn’t stop paying, you’ve got a life line. You still have an engagement issue, but you’re still getting paid! Gym memberships make a lot of their money this way. It’s not the worst model. Because the worst model is dying.

Marketing

1. Target Customers: You will spend a lot of time and energy on people that don’t have skin in the game if you don’t make them pay for it. This does nothing to help you survive.
2. Target Personas: Develop personas of individuals and how you can target those individuals.
3. Target Channels: Where did you found those paying customers? Go back there and find more.

Team

1. Hiring: People want to work on the winning team. The winning team is one that is growing, and the most efficient way to grow is to get money in the door from your customers.
2. Hiring: People are expensive. If you have no money, you can’t afford them. The ability to pay your employees with money you made from customers is a phenomenal accomplishment. Selling early gets you closer to that.
3. Motivation: The sound of the cash register dinging is an amazing motivator and validator that what you’re doing is important to someone.
4. Retention: Good people are hard to keep. Winning helps keep them. The more money in the door, the easier it is to keep the good people.

Personal

1. Motivation: I personally pounded my head against the wall for almost 2 years deluding myself that I didn’t need paying customers day 1. I was wrong. Dead wrong. I would make up excuses, but had I just sold the product, the excuses would disappear.
2. Motivation part-2: The tighter your feedback loop from energy expended to even a modicum of success the easier it is to keep working, keep building, and serve customers. For a founder, this is invaluable, because building a company isn’t easy. It’s hard. And the more motivation you have to wake up in the morning the easier it becomes.

If the above isn’t enough reasons to put selling your product as the #1 priority, I would strongly recommend reconsidering working on your startup.

Selling 101

I am not a salesperson, and I don’t consider myself a salesperson, but I have had to learn how to sell. So here’s how to do it:

1. Stop being a little bitch
2. Pick up the phone, call your users, tell them a price, ask for a credit card, and charge it on the spot.
3. Repeat steps 1 & 2

After about the 10th “Go F**k yourself” it becomes a lot easier.

Comment below if I missed anything.