David Cummings on Startups

Blog

  • Startup CEOs Should Sell Deals

    Continuing the sales rep theme from yesterday, one of the topics we debated earlier this week at the EO Accelerator group was that of the startup CEO selling to prospects. Startup CEOs wear many hats, and sales should be one of the top priorities. This is particularly applicable in consulting companies where it is more of a partner-type sale requiring extensive domain expertise in addition to building trust and rapport.

    One of the sentiments at the meeting was how difficult it is to both sell new deals and continue to manage the day-to-day operations. When the topic of hiring sales people came up, everyone lamented about how they’ve never had success bringing on a business development person. My advice to entrepreneurs in this position is simple: hire an appointment setter and relationship coordinator to enable greater economies of scale with the partner-level selling. Expecting someone to come in and be as effective as the CEO at selling isn’t a reasonable expectation, but setting up processes and people to make the CEO more successful at selling until the business reaches a point where the CEO is no longer needed for that role is a strategy I recommend.

  • Sales Reps, Sales Reps, Sales Reps

    I’ve been hearing a good bit of discussion lately from entrepreneurs that are looking to find talented sales people to help take their businesses to the next level. Finding good sales reps is hard. Finding good sales reps is even harder in this economy. Why? The best sales reps are confident in their ability to sell, love nurturing relationships with people, and are almost never out of work.

    Entrepreneurs, myself included, have a tendency to think that just hiring more sales reps is the easiest lever to pull to accelerate growth or profitability. My gut says there are many more short term, readily identifiable ways to grow sales or profitability, and these should be exercised before hiring sales reps. Here are some quick ones:

    • Increase prices
    • Fire unprofitable clients
    • Collect payments faster
    • Ask suppliers for a discount
    • Ask vendors for longer payment terms

    Look for ways to grow sales and margins in current processes, and then expand sales and marketing.

  • Goal Setting

    Towards the end of today’s meeting with the EO Accelerator accountability group that I mentor on a monthly basis, we got into a discussion about goals. We went around the table in my office and I quickly realized that almost none of the entrepreneurs there (five not counting me) set goals for the month, quarter, or year — I was very surprised.

    As a group, we decided to set three objective, numeric goals in our businesses for this quarter and next. At our December meeting, and meetings going forward, everyone will share their progress report towards the goals. In my company, we set our goals on a quarterly, annual, and three year basis as part of our one page strategic plan. My advice is to do a one page strategic plan, update it quarterly at an off-site, and make it part of the company routine.

    Note: For companies with fewer than 10 employees, I’d still set quarterly and annual goals, but not worry as much about all the details in the one page strategic plan.

  • Roadmap Buy-in Process

    We’re in the midst of our product roadmap planning process right now in order to line up our desired releases for 2010. At first, we thought about bringing in the managers of different departments together to lobby for changes they’d like to see. After evaluating that strategy, we decided to do a hybrid of some managers and some key stakeholders that were passionate about specific areas of the application.

    The fun begins when everyone holes up in a room for several hours hashing everything out. My advice for product managers is as follows:

    • Solicit input from as many different people and types of constituents possible
    • Acknowledge that you can’t do all things for all people but will strive for improvements that 80% of users can benefit from
    • Attempt to incorporate at least one request from each group of users, even if it is a small one, so that you can show them their input matters
    • Always over communicate everything in a variety of mediums (email, phone, in-person, blogs, newsletters, etc)

    Product roadmaps are challenging, and have a short shelf-life, but are an important part of technology companies.

  • SEO Tips

    I had the chance to talk about search engine optimization (SEO) with an expert in town this afternoon. Of course, I had to brag that we have a PageRank of 8 on one site and a PageRank of 7 on another — no small feat for a small technology company. Here are his SEO tips:

    • Do the basics like use the keywords in the title, main heading (h1), URL, and page content
    • Arrange the site hierarchy with the most relevant pages at the top and less important pages in sub-folders
    • Be selective about what gets linked to from the homepage as that’s the most important page on the site
    • Work hard at earning inbound links from other sites to your site
    • Write for humans and not search engines

    These tips are pretty straightforward, but it is amazing how many sites don’t do the basics. With these tips in mind, the most important thing is to publish high quality, fresh content on a regular basis.

  • Web App Mockups / Wireframes

    For product managers and entrepreneurs, one of the more challenging tasks is to efficiently get the product interface and user experience ideas into the hands of a web designer or software engineer. Thankfully, there’s been a nice group of competing products recently that address this issue with web-based, easy-to-use applications just for doing mockups / wireframes. Here are some of the more prominent ones:

    I’d recommend anyone who’s involved in developing software and web applications take a look at this new genre of tools.

  • User Feedback

    One of the most profound changes the Internet has brought to the world of software companies, besides software-as-a-service, is that of user feedback. When I say user feedback, I don’t mean just getting emails with feedback on the product, rather I mean all the different ways people talk about the product with you, with others, and on their own. Think about some of the common ways people provide feedback now:

    • Email
    • Phone
    • Twitter
    • Facebook
    • Message boards
    • Idea exchanges
    • Blogs

    The list goes on and on. Generally, the key isn’t to try and be all things to all people. My favorite strategy is to keep track of feedback in a structured fashion (e.g. inside a CRM or Google Spreadsheet) and then once a change has been made that addresses one of those ideas, reach out to the person or all the people that submitted it, and tell them we listened to their request and made the change in the product. You’ve just won a customer for life.

  • Commercial vs Open Source

    I like to think of my company as being scrappy and resourceful. We love open source, looking to use it everywhere that makes sense. Up until 18 months ago we still had OpenOffice as the standard in the office, that was until the up-roar about incompatibility with MS Office documents became so loud that I caved and bought a license of MS Office for everyone. I wouldn’t say I’m an open source zealot, but I am a big proponent.

    My strategy has always been to start with open source and they look to commercial software once the open source doesn’t work out. As an example, we’ve used open source firewall software in our office for several years now, but it’s no longer meeting our needs. We evaluated bringing in a consultant and paying him several thousand dollars to make the changes we desired vs buying an off-the-shelf firewall appliance. The commercial firewall is being installed next week.

    My advice to entrepreneurs is to be scrappy with resources and to always evaluate open source solutions in addition to commercial systems (this from a guy who’s company makes and sells commercial software).

  • Generational Product User Experiences

    Have you ever used a web application and immediately thought that the interface was from a previous generation of software? Maybe I’m a technology snob, but I immediately notice it and start questioning the rest of the application. The front-end really sets the tone for the entire app.

    Of course, one of the big challenges for a successful product is to migrate to a new user experience, potentially alienating existing customers. Therein lies the challenge: people don’t like change. How do you manage that transition?

    I don’t have a solution here but I recommend entrepreneurs and product managers be cognizant of out-dated product user experiences.

  • Giving Back

    As an entrepreneur, the more successful you become, the more people outside of your company ask for your time. The challenge becomes balancing the desire to give back and help others with the demands of continuing to grow your business. There’s no silver bullet here but at the end of the day it comes down to having great people that you can trust so that you have time to give back and help others.

    My advice for entrepreneurs is to set aside 5-10% of their time from the beginning for giving back and helping others. You won’t regret it.