M is For Mandate

This is a companion piece to Early Stage Enterprise Deal Qualification and Management.

The word “mandate” comes from the Latin root words manus dare, which directly translate to “hand give.” The modern-day definition of a Mandate is “an official order or commission to do something.” This definition works well for B2B sales.

Mandate is critical in early stage venture backed startup deals. Without a Mandate, you run the risk of spending precious time and energy on a deal that has no alignment between the Need you are pursuing and the goals/aspirations of the Budget Holder and Signing Authority. The worst deals are those with strong Needs and weak Mandates. They can last for years, yet fall apart two days before the long-expected close (or they can push on indefinitely).

Whose Mandate Do You Want?
Connecting Mandate to Access can help ensure the Need you are addressing will be approved and funded. Always make certain your Need is in line with the Mandate(s) of the Budget Holder and Signing Authority.

Should We Disqualify If There Is No Mandate?
No; opportunities rarely start with a Mandate. However, you need to know whether someone is operating in rogue mode or in line with the direction of their organization. Almost all organizations have Mandates. In poorly run businesses, people operate under both official and/or unofficial Mandates. Mandates can also shift and change over the lifetime of the deal, especially if you have long sales cycles.

If a Mandate is not surfacing, determine whether it’s truly necessary. (Hint: it almost always is if you are not talking to the Budget Holder and Signing Authority.) If a Mandate is necessary but you have not yet found it, you may encounter two sales cycles: (1) closing the champion, and (2) closing the person(s) who signs and funds the deal. If a Mandate is necessary and your Need does not align with the Mandates of the Budget Holder and/or Signing Authority, you will likely have some combination of a lower probability of close, longer sales cycle, and smaller deal size.

Mandates Are Not Needs
The following analogies demonstrate the differences and interconnections between Mandates and Needs:

Goals are to Objectives as
Mandates are to Needs

Strategy is to Tactics as
Mandates are to Needs

What we are going to achieve is to How we are going to achieve it as
Mandates are to Needs

Top line revenue targets are to Obtaining competitive intelligence as
Mandates are to Needs

Should All Deal Types Use Mandates?
Mandates are for more sophisticated deals. In B2B ARR deals, Mandate becomes relevant around $20,000/year, >30 day cycle, and >1 stakeholder. Keep in mind that even if you have a low price point, if the adoption cost is perceived as high, a strong Need and Mandate will be required.

How Do You Obtain Mandate?
There is a right and wrong way to obtain Mandate; it takes some finesse. January is an easy time to ask for Mandate — you can say, “What is important for {organization} to accomplish in 20##?”

When interacting with a contact who just entered a new position, you can ask, “What is the mission of your new role?”

When having a one-on-one with a CEO over dinner, you can ask, “Where do you want {organization} to be in 36 months?”

In all scenarios, it is important to be genuinely curious about the answer. You Need to know what the organization is running after so you can determine if they should buy from you given their current priorities.

Mandates Give You Authority
Having an authentic desire to help a prospect achieve their Mandate gives you a moral authority that can be used to get things done in support of your deal. If you have the best Solution that addresses a Critical Business Need in line with a Mandate, the prospect should buy. Under these circumstances, you can hold your ground and assert yourself more than normal.

When Do You Ask For a Mandate?
It can depend on the seniority of your contact. If they are the CEO, earlier. If they are a technical contact at the director level, you will likely want to develop Need first. In any case, it helps to have established some rapport.

In some scenarios, Mandate should be one of your first questions. If possible, try to have Mandate conversations in person or at least live on the phone/web. Mandate should not be obtained via email. If there is an unofficial mandate the prospect won’t put it in writing. Also, gathering a Mandate can be a relationship building activity when done properly and live.

Mandates = Leverage and Momentum
Well-run organizations kill unmandated projects fast, but they are also quick to focus human capital and Budget on Mandated projects. People jump when there is work to be done on a Mandated project. Properly aligning to a Mandate is like hitching your deal to a freight train that is running through your prospect’s organization. Money will flow, calendars will clear, and resources will magically appear when you have properly aligned your Need to a strong and related Mandate.