4 Tips For Early Stage B2B Startups That I Wish Someone Told Me

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One of the most common problems facing early stage B2B startups is a tendency to focus on questions that “you think investors care about” rather than concentrating on customers. A theory for why this happens is that many people believe you need a lot of money to develop a robust enough “enterprise” product and sales/marketing team to build and scale a successful B2B business. That may be true over the long haul, but it can produce a lot of misplaced focus in the early stages. Here are 4 Key Considerations to keep in mind to help you stay focused on your customers and truly validate your business.

1) Charge money. Once you are past very early beta testing and feedback gathering, you should begin charging money customers for your product. There is a HUGE difference between someone using your product under the guise of “feedback” and being a paying customer. Asking customers to pay is the most reliable way to get honest feedback on if they value your product. It will also give you insight into business model viability. If people won’t pay, it’s probably better to know why before you invest a lot more time and money into what you are building. A common excuse is “well its not ready yet…or we haven’t built all the key features”. In my opinion, this excuse isn’t valid. Most people use a very small subset of product features and make their buying decision before even using the product. Not to say you should sell a bundle of lies, but all your bells and whistles matter a lot less than you think.

2) Stable and simple. This is related to #1. Most of your users will care about a few very straightforward use cases. Make sure those work consistently and that the codebase is stable. Building features for every edge case is more about your ego than your users.

3) Don’t give the product away for free just to add a brand name logo to your marketing deck. This one is very common. A common misconception is that by having a brand name on your marketing and pitch decks you will have more credibility with investors or other prospective users. Any smart investor will immediately ask if the brand is a paying customer and any prospective user will be far more concerned with how easily the product solves their own problems. If you want to give the product to a well known brand, in the absence of financial payment, you should explicitly negotiate some type of marketing collaboration or commitment to facilitate events, webinars, etc. Something with a clear tangible benefit for you. Otherwise it will be a lot effort for a minimal gain.

4) Don’t shy away from services because “they aren’t scalable”. Guess what? Accenture, Deloitte and BCG are scaling just fine. The explosion of complex B2B software on the market has led to a rapidly growing demand for “digital transformation” (aka “help me figure out how to use all of this shit”). Services can be extremely profitable and high value to your customers. They can also reduce your reliance on external funding sources. I’d think twice before adhering to the conventional wisdom that they aren’t scalable.

Good luck and make sure not to forget about who your real customer is!

The Startup

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Charlie Lambropoulos

Written by

All things startup and technology. Founder of https://www.codecatalyst.co — A product development studio for high growth startups and leading brands.

The Startup

Medium's largest active publication, followed by +732K people. Follow to join our community.

Charlie Lambropoulos

Written by

All things startup and technology. Founder of https://www.codecatalyst.co — A product development studio for high growth startups and leading brands.

The Startup

Medium's largest active publication, followed by +732K people. Follow to join our community.

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