MV #009: The bird is freed, making sales demos suck less & why product-market-fit ain't enough!
Why is it that companies fail after the achieve product market fit? And how can you turn this around? Let's dive into how to start building a go-to-market ready organisation and nail your sales demo!
Read time: 6 min
👋 Hi there, happy Sunday!
Too many startups fail. Often even after they get to product-market-fit.
Why is that?
Many think if you build something that someone is willing to pay for you’re done. You’re not. You haven’t even gotten started really.
Despite product-market fit startup failure rates are sky high. What do startups need to succeeed after they reach product-market-fit?
Spoiler alert: go-to-market-fit.
In the second section we’ll dive into the cornerstone of every sales process, the product demo. Most demos suck. And very often the way to fix it is simple. We’ll dive into one of my favourite ones.
Happy reading!
🥞 Why product-market-fit ain't enough! It’s all about GTM & Sales.
Startups don’t have it easy. At most stages, the odds are stacked against you.
Even at later stages when you have achieved Product-Market-Fit (PMF) life is incredibly tough.
To illustrate this, I’ve pulled an article from Medium by Sebastian Quintero (here). He dissected data showing how hard it is to go from Seed to Series A. Almost 80% fail to raise, and 97% fail to exit.
Once you achieve product-market-fit it gets easier. But only a little bit.
The chances of failing to raise funds remains between 50% and 80%. It’s nice that it gets kind of easier, but shouldn’t it get much easier?
Creating a repeatable sales motion
Many founders, especially technical ones, love their products but don’t know how to get them to market in a repeatable and scalable way.
That’s what breaks their neck when they start scaling. You move forward in an unscalable way. You don’t think about a repeatable sales motion. You don’t just scale the good stuff, you exponentially scale the bad stuff.
The inefficient, unscalable sales you’ve done to date by convincing a few customers to try your product are great, and they validated you. But it all gets much harder once you think about a repeatable sales motion.
Making sales scalable and achieving Go-To-Market fit is the much-understated challenge after you get to Product-Market-Fit. Below is a B2B buyer journey outlined by Gartner (here).
It’s complicated. There are so many things to consider in today’s B2B buyer journey. At every point you can fail. It’s a real process. The good thing about this is, a process can be measured, optimised and made more efficient.
Three tips to help unlock go-to-market fit
#1 Create a GTM strategy
Don’t overthink it but do think about it. Your GTM strategy should be a defined plan for going to market with your product. It explains what field you are playing on and how you will win on that field.
Some basic questions you have to ask:
What’s the value proposition?
Who are you selling to?
Who is your buyer?
How will you reach them?
How do you measure success?
Who is your competitor?
🧰 Resources
#2 Create a rigid sales process
Every sales process is a bit different. But typically, you will have a few stages for each sales opportunity. It often starts at stage 0 with an introductory meeting and completes with a final stage called closed-won or closed-lost.
Each step has to have clear stage entry and exit criteria.
For example, moving from stage 1 to stage 2 means moving from Qualification to Proving Value.
To exit stage 1, you want to have identified a few basics like budget, authority needs, and timing. That model is referred to as BANT.
There are a lot more methodologies in sales. BANT is just a basic one for qualification. (see MEDDPICC)
Only once stage 1 exit criteria are identified do you want to move on to the next stage. This is not always an exact science but it will help you create rigid process and start tracking where you win and where you lose opportunities.
🧰 Resources
#3 Establish a fast, data-driven feedback loop for GTM
You can’t manage what you don’t measure.
Make sure you have a tight feedback loop. Get a CRM, track deals, track conversions, track onboarding and make sure your customer realise value. If there are gaps, fix it.
🧰 Resources
That’s it. I hope founders and business builders see the value in this. As soon as you get some traction, it becomes about how you’ll go to market.
The journey is still very hard. But with a good plan in place, a defined process and the systems to track it, you’ll make sure you’re not flying blind.
TL;DR
After you achieve product-market fit, the race continues.
Set out a GTM plan and strategy for your business.
Design a clear, rigorous sales process.
Track key metrics to understand progress and what works and what doesn’t.
Don’t give up! Building startups is hard.
🔑 Why most sales demos suck and how to fix it
Sales engineers, sales reps and pretty much everyone who demos a product makes this fundamental mistake when they start out.
They forget to sell the value.
It certainly took me plenty of practice to change my approach. It’s also easy to fall into this trap. After all, to you, it’s clear how amazing your product is and how it will change the life of users.
As an expert in your product, your sales demos end up like harbour cruises of amazing features in your software. You really want to make sure you show them EVERYTHING. Because there’s so much goodness.
But, guess what?!
Prospects do not care about features. Every software demo today looks great and can do a lot.
What really makes the sale is selling value. So, here's how to change that. After every single statement, add the SO WHAT.
The "So what?" is your VALUE STATEMENT.
Here's an example.
⏪ BEFORE
"Here we can automatically show all activity from your reps in one view."
⏩ AFTER
Here we can automatically show all activity from your reps in one view so you won't have to chase them, they won't have to log it manually, and most importantly, you can focus on coaching them to increase your chances of winning a deal.
Try it out.
After EVERY sentence, ask yourself: What's the "So what"? I mean it, do it after every single sentence. It’ll be silly at first. But once you practice, it’ll be second nature and resonate much better.
Making a VALUE STATEMENT after each point will make your sales demo so much BETTER.
🗞️ In other news
Elon Musk buys Twitter. Some of the reactions are hilarious. Seems like the SaaS-OG Marc Benioff isn’t a fan.
At least he’ll probably get more time to spend with his Co-CEO, Bret Taylor, who quite possibly could be fired from the board soon.
Ever wonder what CEOs and board members talk about?
Will Robbins from Contrary, a VC, posted Evan Spiegel’s leaked email discussion with a board member. It’s an incredible read. Check it out here.
“Regardless, my advice is to be the bigger person and call Zuck and apologize for the leak (even though it wasn't your fault) and deny any culpability. I know you have no interest in selling to him, but you want to keep on good terms with the enemy. :)”
🙏 That’s it. Have a great Sunday!
🤓 Don’t know me? Here’s the about section.
My name is Semir Jahic.
More Value is my newsletter with lessons, stories, observations and analyses from my experience building a VC-backed B2B software startup and leading a high-performing sales engineering team.
More value is made for startup builders & sales engineering leaders.
But if you enjoy learning, want to work in startups and become an effective go-to-market leader, you’ll enjoy reading More Value too.