Thursday, March 25, 2010

Unambiguous Customer Communication Post-Acquisition

This has to be the best post-acquisition customer communication I have ever seen - very blunt, direct and unambiguous.  History will show whether they delivered, but Oracle is off to a good start (and I love the stab at IBM at the end):

Saturday, March 20, 2010

Your business card is CRAP!

I've always noticed that 95%+ of all business cards I get are terrible - they don't stand out or tell me anything useful about the company or the individual.  The best source of information is from a website, so all a business cards needs is:

  • Name
  • Title
  • Company & Web site
  • email
  • Cell phone (if necessary)

I use Moo mini cards with text on one side, and a color photo on the other side - I have various versions of the image, from pics of myself to company logos, but I always get positive feedback - people remember me from the business cards.

Here is someone with an even more impressive business card - not sure if I'd go to this extent, but it's an interesting view.

Tuesday, March 16, 2010

Startup Advice - so you have a great idea?

The following question was recently posted on an entrepreneur forum:

At the moment I have an idea in mind that I believe could be really big. I have discussed it with a few close friends because I wish to take first-mover advantage. The problem is that I lack the programming ability to make it a reality on my own. My programming friends are quite busy with work and they don't believe that they have the level of programming ability I require.

I have developed a workable operational and growth strategy with a revenue stream that will not commence until after 1-2 years. What should I do to seek trustworthy web programming expertise that I require?

Where can I go from here? 

I was extremely impressed with the response from Brad Down, printed below:

The reality is if you have no money, no friends that can help and no business partner, all you have is your idea.

The first thing you need to do is pretend like you already have the product and go out and sell it. Develop a sales presentation some collateral even a basic display website. Then ring up some potential customers say you have a product in development and get some meetings.

Remember it's all in the sizzle not in the sausage. If you can't even get a meeting based on your idea alone then you know you are in serious trouble already. Take my advice, forget development, focus on your first sale. If you get a potential customer then you at least you have something to work towards.
If you can't make a sale then you are wasting your money and human capital with dev.

I spent over $100K of investor money on our first startup before we made our first sales call. Fatal...we could have saved the $100K if we had have done some research and actually asked some people if they wanted what we were selling. No matter how good your idea, commercial realities exist, so many external factors and perceptions can affect your business model.

So much can be done without a cent spent on dev.

Brad's comment is a very concise statement of the SDBS methodology:
  1. Sell 
  2. Design 
  3. Build 
  4. Sell 

As Brad says, if you can't get a single customer to commit to your product before development starts, then you are likely wasting your time. Enough said.

Thursday, March 11, 2010

Startup Advice - running short of funds for initial product release

Last week I received an email from an entrepreneur here in the SF Bay area with a really good question:

I needed some advice on our product - our current funding will allow us to complete the initial release, but with limited content and with a few features missing - and since its a product where content drives the experience and value - it is critical. We need some more funding to get the product out in all its glory and don't want to be rushed and want to deliver good presentation quality.

Should we trust that it will all work out fine and go ahead and try to find outside money before launch through publishers/investors?

The whole team believes in this product and if we were to do a smaller release first, the energy would be lost. The truth is the team really believes in this - and we wouldn't be able to execute if we tried to just deliver something un-innovative.

What is your opinion on this?

This is a great question, and here was my response:

Obviously I have very little understanding of exactly what your team is building, so my response is going to be somewhat generic.

Each time you accept outside capital you will dilute the shareholding and need to focus on fundraising instead of working on the initial release. This can also result in a loss of energy and focus and is why it's best to get more money that you need each time to keep a "buffer" in the bank.  Experienced investors will know that software development is an art as well as a science, and there are always unforeseen risks.

Of course you could initially try to raise more from existing investors - this should be much easier, and if they believe in the team, should be willing to increase their investment.

Great to hear that your team all really believes in the product, but how have you validated this with potential customers?  Your risk profile has to be based on how much potential customer validation you have - this is the best measure of potential success.  Remember that with advertising supported businesses, your paying customer is the advertising agency that sends you a check (e.g. Google).  They are the ones who get the value from the customer traffic driven.

Is there is any way you can do a limited release of some functionality to a small number of users? I've participated in many traditional product and web services betas and they can be extremely tightly restricted to a smaller audience until you have the right product - this can also build up demand for the final product.

Sometimes it's good to step back and re-validate that you absolutely need all the features in release one - the key is to get the minimal viable product (MVP) in the market as quickly as possible, and then build momentum. A good example here is the Apple iPhone - the first version couldn't even do 3G, but it didn't stop their success.

Friday, March 5, 2010

Effective Trade Shows

Recently I attended two seperate trade show - the Consumer Electronics Show (CES) in Las Vegas and the RSA Conference in San Francisco.  While wandering around the shows I made some observations that would make a great blog post.

Like any marketing activity, you need to know the objective in going to a trade show and how you are going to measure success.  In the pre-Internet era Tradeshows were an incredibly important part of the eco-system for many industries - this was where you found new products, resellers, distributors, and of course, customers. But in the Internet age information is instantly available anywhere in the world.  There may not be any need to physically be at a show, when you can watch a simultaneous podcast and get the same information, or meet needed contacts through other methods such as Linkedin.

Of course this depends on your organizational goals - you may have strategic reasons for being at a show, such as getting noticed, speaking with customers, partners, press and analysts etc.  Sit down and rationalize how best to meet your objectives, and don't just go for the traditional booth because "we've always done it that way". Measure success to help decide the ROI and value of each event and activity.

Many groups measure success by numbers of raw leads and will scan anyone walking by to meet their goals.  Unless you have a group of people who go out and re-validate each lead, it's better to gather just leads from people who have shown some interest.  If marketing people love to tell you how many trade show leads they gathered, make sure the leads are real, and not just "raw" - I've seen people scan the line at the food court to make up a more impressive lead count.  On the other side of the coin, I've gone up to a booth and talked for sometime, and they let me wander away without bothering to scan my details - not sure how they intend to follow up.

The most concerning aspect at almost any trade show there is a large number of booths staffed with employees who don't want to talk to potential customers.  They'll be checking their email, having a private conversation, meeting old friends, sitting down and looking bored, or doing anything else except talking to booth visitors.  Many of them likely partied too hard the night before, and viewed the show as a free trip to the trade show city. Then you have the numerous booths that are sitting empty with nobody in sight - who knows where these people are?

At the RSA show this week there was one company I wanted to talk with, and spent 15 minutes "hovering" at their booth, but could find nobody to help.  Out of about 15 employees, many were playing the video games installed for the customers, others were having their own private conversation, checking Blackberrys, or using the demo machines to do email.  This was in a booth that cost the company well over $100K, and this was repeated numerous times at both conferences - so as well as not giving me information, these companies have created a negative impression. In all honesty, out of about 15 people manning the booth, nobody was helping a customer, and I wasn't the only one trying to get attention. I shouldn't need to mention this, but the employee enjoying the burger at his pod - eating at your booth is a definite no-no.

If you're going to have a booth, make it effective, and have someone in charge who can plan, train, manage and follow up.  Have a booth meeting before the event, and hand out written booth schedules, background material and collateral.  Explain the objectives and make sure everyone understands.  Show everyone how to ask customers if they can help and how to direct them to the right part of the booth.  And make sure everyone understands that email, Blackberry, cell phone calls, eating, nose-picking, butt-scratching etc are not allowed in the booth - do them on your break. And don't sit down - standing up is much more welcoming to customers.  Yes, manning a booth is tiring and difficult, but you need to suck it up and do a great job.

I prefer a "clean" uncluttered layout with a small number of demo pods, contact desk, a small theater, and 5-10 minute presentations for a seated audience to get a t-shirt or another giveaway.  You're swapping the attendees time to listen to your pitch for a give-away, instead of just launching it into the crowd.  The audience is showing that they are interested enough to sit and listen to you for a few minutes. Take a look at the PGP booth from RSA - notice the 20 or so chairs to the left where they have their theatre - this was a nicely laid out, and very well managed booth.  I was impressed with how the booth staff worked the passing crowd to get them to sit down prior to a presentation, and ended up filling every seat. Notice also that they're not bombarding you with ridiculous amounts of text and product information while walking past - just enough to draw you in for a further discussion.

For a startup, I would forget trying to get in your own booth, but being in a larger company's partner pavilion can be very inexpensive and extremely rewarding.  For a few thousand dollars you get a pedestal, signage, listing in the show guide, and even a monitor.  Everyone that walks in the partner's pavilion is a prospect for you, and you also get exposure to the partner's employees, executives, press and analysts. Make sure you bring 2-3 people to have the booth manned at all times, and let people have regular breaks.  Don't forget that this is a great time to meet other partners, especially during lunch and after the conference - find out what they are doing that is leading to success.

Lastly, I'm a big fan of Oscar Wilde's quote that "the only thing worse than being talked about, is not being talked about".  Marketing is all about getting attention, and trade shows are full of sound, noise, and attendees become overloaded.  If you're going to make the effort to attend, try to be different. At Netoria we dressed our booth staff in outrageous Mambo loud shirts, and got huge amounts of attention at every event. Note that getting attention doesn't mean "booth babes" in skimpy clothing - you're going to turn off many of the audience (even if you personally like that type of thing).

Don't waste time and money giving t-shirts or some piece of junk to everyone who walks by - if you want a cheap giveaway then provide something useful like a pen.  Netoria didn't giveway a t-shirt to everyone, but took 5-10 $70 leatherman tools engraved with "Netoria - tools for NDS", plus a few of the loud shirts, and handed them out to hot prospects.  Even now, 10 years later, I get people who tell me that they still have that leatherman tool or Mambo shirt (note the photo is not from Netoria, but we did wear these exact shirts to one show).

At every tradeshow you have a chance to make a great initial impression with a new customer, partner, investor, press, analyst etc - like every marketing activity, make sure you know the goals and how you will measure success, and then put your best into creating the right impression.