What Enterprise Unicorns Do Differently
Despite the current upheaval caused by the pandemic, there’s never been a better — or more interesting — time for B2B technology, especially in enterprise SaaS. There’s robust talent, plenty of capital and urgency for digital transformation in all forms.
Today’s volatility is not without its challenges. The market is especially crowded, valuations are crazy and too many companies speak more about how much they’ve raised than how much revenue they’ve generated. Those of us who’ve been around these cycles in ’99, ’08 and today know that the inevitable fall to come is healthy for the tech market as a whole — clearing away the weeds for the stronger companies to thrive.
The billion-dollar question is, who thrives while others fail? And why? In my experience working with more than two dozen promising startups, category leaders, unicorns, and “failure to thrive” companies, the break-outs do four key things differently than the rest of the pack:
1. They’re innate thought leaders
2. They sell higher
3. They build customer champions
4. They cultivate influencer relationships
While these may seem like obvious success factors, sustainable execution is the challenge. Done right, though, they work together to launch startups into “unicorns” and help them scale to true category leaders.
Breakout companies commit to thought leadership. They are innate educators, with passion for the problem they solve and opportunities they create, understanding both cause and impact. They’re persistent — obsessively so — in finding and honing the solution. They have a clear vision for their customers’ better future state and their own role in the technology ecosystem.
Thought leaders can see how trends converge to position a solution. (For SAP it was about process reengineering and globalization. For Qlik, it was about democratization of analytics and in-memory processing, enabling business intelligence for “everyone.”) It’s a leapfrog opportunity to catch innovators and early adopters, who want to catch the wave before others do.
This is more than content marketing (although that’s a solid by-product). Thought leadership is about evangelism and a commitment to engage in the market ecosystem in a broader and public way. It’s about a particular point of view — often a provocative one. (Consider Marc Benioff’s famous “end of software” statement.) Take a stand.
Breakout companies sell higher. Thought leaders are already having a strategic conversation. They understand the challenges of their buyers and translate their solution fit not only to specific needs but also to the broader business objectives of the organization. They speak business language, not product features.
This “lost in translation” is one of the biggest challenges for technically-oriented teams. International startups are especially prone to struggling here in the U.S., where buyers are often more sophisticated in their expectations for proof of value and sellers may be new to enterprise-scale environments.
Think of it as the difference between selling a Croque Madame to buyers who want an Egg McMuffin. The Croque Madame is made in a special pan, using organic (bien sur) eggs that come from the best local farm and a specific type of bread. On the other hand (literally), an Egg McMuffin is tasty, can be had for a dollar and eaten while driving. Arguably, both are satisfying hunger, but the former appeals to process, while the latter focuses on the result.
And this doesn’t necessarily mean you have to — or should — target the CEO or C-suite. Just be sure to understand and communicate the ultimate value of what you sell (which should be aligned with who’s actually paying for it).
Breakout companies have a culture of customer success. The “land and expand” model depends on growth through customer experience. This means paying attention to value and cultivating customer partnerships throughout the entire journey, from selling and signing to deployment to the new everyday living with your solution. Breakout companies engage with customer teams to capture the intent and experience, the soft and hard ROI and the lessons learned. Celonis is a best-in-class example of this and it’s clearly paying off! (Disclosure: That was an initiative we led for them.)
If you’re only focused on winning new/next deals, you miss the opportunity to grow within the account, to understand new use cases and to spot potential issues before they become problems. For startups, especially, positive customer references are existential.
Sustainable growth comes from customer advocacy — and it’s personal. Often, executive sponsorship can make — or reinvigorate — a customer’s career. Early adopters balance innovation and risk of failure when they buy from you. They expect to gain competitive advantage (sometimes at the expense of a seamless ride). This was an early lesson at SAP, when we surrounded and celebrated “lighthouse” customers, capturing every aspect of their experience and promoting them as individual champions inside their companies and across the ecosystem. (In fact, some are still “Facebook friends” today!)
Breakout companies leverage broader market and customer influencers. They study and engage with the advisors who surround the customer — the management consultants, systems integrators, platform vendors and others who tend to drive the solution agenda. They follow and reach out to the industry analysts who report on the space. Here, it’s not only the “usual suspects” who dominate; it’s also the independent and boutique experts who are watching, advising and blogging.
It doesn’t mean you have to instantly sign up for expensive subscription contracts or formalize alliance partnerships. Keeping track of their interests and providing information of use in their context is a way to start relationships. Social engagement opens the door. (This “circles back” to the currency of thought leadership and the value of customer references.)
Do you have what it takes to be a breakout company? Often, it’s in the DNA of leadership and the culture they create. It takes self-awareness, commitment to go beyond the basics and ultimately, persistent execution. It takes objectivity to connect dots, study the market and competitors and find your unique strengths. Most importantly, it takes integrity to be sure you can deliver on the promise you envision.
Bonnie Ravina is an operating partner at Ring Capital and the founder of Full Circle Communications, a B2B tech marketing firm dedicated to go-to-market strategies and programs that help companies position, grow, sell and scale. She is based in Philadelphia (USA).
