Many startups begin life selling to small business (SMB). SMB is a very appealing market. For one, it’s big (30 million businesses in the US alone). Also, they make quick buying decisions. Sounds great!
The challenge with SMB as a customer segment is that each customer is small. It might be easy to get your first few customers. But over time you become a victim of your own success. The bigger you get, the higher your customer acquisition costs go. Hubspot’s CEO Brian Halligan illustrates this challenge beautifully in his recent post ‘why aren’t there more Intuits”.
Building the next Intuit…
If you sell more to the ‘M’ (i.e. mid-sized businesses), then you can build a large inside sales team. This is what Hubspot does. This is also why they raised boat loads of capital. Once they got their fundamental unit of growth working, they never stopped hiring sales reps. Continue reading Creative ways to scale SMB customer acquisition
There is so much emphasis on user experience and design these days, it’s no surprise that this emphasis would make it’s way into how companies get funded.
I owe Mike McDerment, co-founder and CEO of FreshBooks for this insight. Together, we raised FreshBooks’ 1st and only institutional funding round last year. Mike has some very particular views on the importance of “experience”. In fact, the company’s manta is “execute extraordinary experiences everyday”. This saying impacts everything, big and small, throughout the company.
Back to fundraising: Investors see more opportunities than ever before. How do you stand out? First and foremost, have traction. This more than anything else gets investor attention. But assuming you have the three Ps (Product, People and Progress – aka traction), then I believe that the experience of raising makes all the difference. Continue reading The fundraising experience
How often have you sat in front of VCs or advisors and been asked ‘Can this be a billion $ business?’. I have. I find it to be an incredibly frustrating question. When you’re at the start of your business, if you’re spending time thinking about how to be a billion $ business, you’re wasting time.
Here are some stats: There are 100s of venture firms investing in many 1,000s of startups. Out of all of that activity there are 80 privately held technology companies worth $1B (source: CBinsights) in the US. In Canada, there are two (Shopify and Hootsuite).
Continue reading Can this be a $B Startup???
Who are these handsome people you ask? A small part of FreshBooks’ award-winning support team receiving Stevie Awards for outstanding customers support.
Once upon a time customer support was relegated to outsourced call centres, where the focus was on cost minimization and maximizing efficiency, with little consideration of actual customer experience. You still see this today inside old school, sleepy giants in the banking and telco sectors.
Continue reading The new customer support