Ready, set, sell!
What are the five essential questions B2B startups should ask themselves about sales?
We sell all the time: parents sell when they encourage their children to behave, you sell when you influence them to adopt your view of how they should act, and a colleague at work sells when he or she persuades you to try this new app.
Why do founders of startups have such a hard time selling, and why is B2B sales such a challenge? Our experience has shown us that founders are often not ready to be in the position to sell. The truth is, YOUR PRODUCT WILL NOT SELL ITSELF, regardless of how awesome it is. You must be prepared.
That’s why we at APX (early-stage investor, supporting top founding teams with disruptive digital ideas and accelerating their growth) work with founders to help them shape their message. We teach founders to focus on answering some core questions before sending the first cold inquiry on Linkedin. Making a sale is, in fact, the result of a successful process involving a variety of components and actors. How do you design this process? The starting point to a good design is to ask yourself the right questions regarding your offering.
- Am I solving a problem that exists?
- Who am I solving this problem for?
- What is my target segment?
- How am I going to win this segment?
- How do I solve the problem better than anyone else?
We help founders get to the bottom of these questions and internally refer to this process as ‘APX Sales Readiness Process.’ This process will enable the company to optimize its sales strategy, improve its conversion rates, and boost its revenue. It also positively affects the number of business development opportunities and warm introductions for the company. The Sales Readiness Process includes the following steps:
- Information gathering:
The selected B2B startups are asked to provide detailed information about their sales strategy, which is then analyzed by the APX team and our B2B expert Patrick Brienen, the founder of Orderbird AG. - Sales Readiness Review:
Members of the selected B2B startups meet with our team and the B2B expert for a mock-up call with a customer, followed by a Q&A session to ensure the founders’ readiness to acquire customers and grow their business. - Follow-up & introductions:
The Sales Readiness Review gives us at APX valuable insight into the company’s readiness for sales, paving the way for relevant business connections and opportunities.
What does being “sales-ready” mean?
Being ‘sales-ready’ means being able to execute and control all the components of the sales process. To make this assessment, we asked startups and experts for feedback and collected six indicators that play a big part in a company’s ‘sales readiness’:
- Having a clear understanding of segmentation, targeting, and positioning:
These are vital aspects of achieving a successful market entry. Establishing a clear understanding of your initial target market and focusing on one segment first avoids overlaps and wasteful sales and marketing resources. It also shows a foothold in the market. - A coherent and focused sales pitch:
The sales pitch is your opportunity to build relationships with relevant stakeholders within the company, propose your solution, and move a potential client through the sales funnel. Is your pitch focused and to the point? Does it leave room to learn more? Does it allow you to connect with the relevant stakeholders and to get to the next steps? - Understanding the problem, you are solving:
Your ability to clearly define the problem allows you to establish a connection and helps your prospects see how you can solve the problems they face. You need a grasp of the most significant pain point, who the critical stakeholders are, and what “solving the problem” actually means (How is success defined?). Often, the result is an understanding of the exact value proposition you’re providing to the customer, which would allow you to build a much stronger case. - Understanding how the buying process works:
To avoid wasting your efforts by pursuing the wrong path, you must clearly understand the buying process. How long is the sales cycle? Who are you selling to? Who is making the buying decision? What are the terms and conditions? Who signs the contract and who wires the money? Understanding your target customers’ buying reflexes, the industry standards, and the steps needed to make a sale will help you assess competitors and partners more accurately. - Sales productivity:
Defining clear team responsibilities within the selling process is crucial to reduce costs and increase sales volume. This also applies to relevant feedback and information produced during the sales process. What is the feedback from the clients? Where do you get feedback from? What are the KPIs, and how do you track them? - Measuring the success of a product (and proving it):
Even risk-free adoption of a new technology necessarily entails a business commitment in both time and resources (it, therefore, creates costs). You have to be able to prove how much value you provide. You can build upon your hypotheses and provide assumptions on the pilot/product and the customer’s return on investment.
Why do we at APX care about it?
Our role as an early-stage VC is to give founders the space they need to thrive, raise follow-on funding, and ultimately have a global impact. But this has to go hand in hand with its ability to implement a successful sales and marketing strategy and scale globally. At APX, we believe in a customer-centric approach and in teams that can listen to customer feedback to offer solutions that these customers need. We invest in great teams with a customer-centric mindset that’s deeply rooted in creating value and building relationships with their customers and see their feedback as a way to foster continual improvement and growth.
About the authors:
Mor Eini, Strategic Partnership & Growth and Elena Alfonsi, Venture Development, APX.
We support APX portfolio companies with Business Development and their sales strategy.
