Category Archives: Sales

Why Lawyers Don’t Run Startups

Why Lawyers Don’t Run Startups

This article by Steve Blank is excellent.  The business decision-makers should negotiate the strategic issues and then engage the lawyers to draw a contract that reflects those agreements.

“Startups need to have a great lawyer, accountant, patent attorney, etc. But founders need to know how to ask for their advice and when to ignore it…

Strategy Questions Not Legal Questions

The issues our lawyer had raised about the contract, while correct, were strategy questions the founders needed to answer, not legal questions. Negotiating deal points before we thought through our strategy at best would have cost us a ton of money with little progress.

Looking at the Visio contract the question we were faced with was; how bad would the short term consequences be in signing the deal? The answer to that was easy – none. We’d have money in the bank and a reference customer.

The next question was, how bad would the deal points Visio was asking for screw us in the long term? This was more complex. Some of them would have limited our ability to sell to other software companies. Those were clearly unacceptable. Some of their other requests were just “comfort” issues like putting the software in escrow to protect Visio in case our startup went out of business.

Finally, there was a class of what I call “business development contract terms.” This happens in every company when a contract is passed around for review and everyone feels they have to mark it up with extraneous demands to feel like they had their say. Most of these points might have sounded great in law school but were impossible for a startup to deliver….”

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Selling Tools or Solutions to the Enterprise?

Are you Selling Solutions or Tools to the Enterprise?

I regularly encounter SaaS application vendors who are having difficulty getting traction in Enterprise customer acquisition.  The founders think they have an Enterprise Solution because it has the potential to change the way work is done in the Enterprise.  Because they a)  have limited functionality in the initial version and b) have not done the hard work to understand and quantify the value to the customer, they price it low ($25K ARR or less).  The result is that prospects see the application as a tool or point product.  Enterprise executives, who have the authority and political capital to authorize changes in the way work is done are looking for solutions to their top priority problems.  They do not spend cycles on low-priced tools.  They delegate the evaluation to those who don’t have the authority or political power to change the way work is done.   Often, prospects see the app as a “nice-to-have” rather than a “must have”.   The result is low close rates and long sales cycles.  Sales reps try to solve this by forcing demos on every candidate they can find.  They focus on features rather than value for the customer because they have not been trained how to sell value.   The founders may see the traction problem as poor sales execution when it may well be product positioning, low price and the lack of a clear value proposition.

See a related post on Selling Value to Executives.

If you need help, contact Growth Process Group.

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Generational Differences Impact Sales

I really liked this post from Carew International on the generational differences and the impact on sales. It provides some interesting insight for sales leaders. The detailed Generational Differences Chart, provided at the Workflow Management Coalition website, is worth a look.

I also recommend “Not Everyone Gets a Trophy”, a book on the topic by Bruce Tulgan.

Increased generational diversity in the workforce means that getting into the “Odds Are” of customers is more complicated and challenging than ever before. Currently there is a big generational shift underway with the rapid exit of Boomers, due to retirement, the increasing proportion of Gen Xers among decision makers, and the arrival of Millennials into management positions.

While we must be careful not to cast blanket stereotypes, we can all benefit from increased awareness and attention to generational influences if we leverage these specific values and expectations for superior sales and customer service effectiveness. In general, “Baby Boomers” tend to be more structured and formal, “Gen Xers” more casual, and “Millennials” (also known as Gen Ys) still more relaxed. This distinction impacts every aspect of the sales process and customer relationship.

Generational influences may be most obvious in the area of customer communications, including format, frequency and style. For example, Boomers appreciate in-person interaction and personal relationships as part of business. In written communications, they expect proper grammar and punctuation. Boomers appreciate recognition of stature/authority. They are more likely to invoke regularly scheduled meetings, updates or phone calls.

In contrast, Gen Xers respond to more direct/blunt communications. They are less interested in “regular” meetings, but they expect more timely and frequent communication. Gen Xers are not as concerned with authority and rank, but expect their sales rep to learn their language and meet them in their world.

Millennials are far less interested in in-person meetings. They greatly prefer the efficiency of electronic communication, and expect immediate response to questions and requests. Their collaborative tendencies mean Millennials want to be included as you develop solutions for their organization. Millennials are more likely to buy in groups, versus Baby Boomers who tend to assume and assign single decision makers, and will be more definitive about who is in charge. It is important to understand who the decision maker is, and if it is indeed a committee making the purchase decision.

The key is to be aware of generational influences, and then be flexible in the style, rhythm and format you apply to different customers. Mentoring with different aged sales professionals on your own sales team is a great avenue for ongoing insight and feedback. With every new challenge comes new opportunity. Leverage your generational insight and awareness effectively and you will create a differentiating sales advantage.

Of course, these insights are just the tip of the iceberg! Want to take a deeper look at generational influences? The detailed Generational Differences Chart, provided at the Workflow Management Coalition website, is an excellent reference resource.

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Improve Forecast Accuracy for Complex Transactions


At Growth Process Group, we focus on complex sales scenarios involving large transactions with medium to large companies.

A common definition for forecast accuracy is the percentage of the bookings dollars that were closed in the quarter as compared to the forecast at the start of the quarter. Some companies use a monthly metric.

To improve forecast accuracy, you need to adopt a consistent sales process. We advocate the development of Sales Process Models that include the desired prospect/customer commitment action at each stage. When you measure pipeline position by customer action, rather than sales optimism; you have a much clearer view of the pipeline quality and you are able to start improving your forecast process and accuracy. Here is an example of a portion of sales process model with customer commitment added at each stage:


We suggest the use of specific “Exit Criteria” to help sales leaders determine if a sales cycle is eligible to proceed to the next stage. This is an example showing specific exit criteria:


The next step is to assign probabilities to the stages in the model. Probabilities should be based on past date, if it exists. If not, experienced sales leaders can assign reasonable probabilities as a starting place. These should be modified as soon as sufficient transaction data is available. With this approach, weighted forecasts move more toward data-based than opinion based.

It is important to recognize that not every sales process follows a serial path. The definition of acceptable alternative paths for deals helps sales leaders coach their reps on how and whether or not to proceed on a deal. This shows an example of alternate paths:


Notice the “STOP” element. Many sales organizations do not have rules on when to stop selling. If your sales team is effective at terminating sales cycles early for deals that are unlikely to close, they can focus on the high quality prospects and sales productivity improves. Doing this well means you have to develop good criteria for deals that are good fit vs. those that are not. Implementation of Rules for Stopping sales cycles is a key element in improving your forecast accuracy.

To improve your Forecast Accuracy, develop and apply Perfect Prospect Profiles, Qualified Lead Criteria, Sales Cycle stage exit criteria, Forecast Rule Sets and win probabilities that are data-based. If you adopt a continuous improvement method for each of these elements, the result will be improved forecast accuracy.

Contact Growth Process Group to improve your Forecasting Process and Forecast Accuracy.

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