Connect with us
https://tpc.googlesyndication.com/pagead/imgad?id=CICAgKDriYHe3QEQARgBMgh47LykQhqW-w

Business

Why This Company Didn't Invest in an Overpaid Sales Team or a Fancy HQ

Entrepreneur

Published

on

Having cut my teeth in Silicon Valley during the first dot-com gold rush, I saw firsthand how so many VC-backed startups grew fast — and fizzled out quickly. Instead of investing heavily in building an outstanding product and limiting the spend on sales, many VCs convinced the founders to recruit the best relationship builders money could buy, overspend on fancy headquarters and quickly layer in several management tiers. This overspending would then compensate for their lackluster products.

Related: 4 Tips to Growing a Multimillion-Dollar Business With Zero Debt and No Investors

We’ve built PowerInbox with a completely different approach, fueled by the passionate belief that great products sell themselves. Rather than spending big bucks on hired guns, we’ve tapped into our founders’ expertise to take on the sales role, and it’s made all the difference for our customers. Instead of adding CROs, CSOs, SVPs and a huge marketing team to our roster, we’ve added outstanding features and functionality to our product that deliver on our customers’ needs.

And while others have built glass towers in the trendiest locations to house their elite team, we’ve taken a decidedly more grounded approach. No glitzy HQ. No opulent conference facilities. No in-house café or relaxation rooms. Just a nimble, globally dispersed, highly responsive team that’s ready to serve our customers anywhere, anytime, at a moment’s notice. Sure, we’ve had some strange looks when we tell customers we don’t have a corporate HQ. But, no one makes a buying decision based on the view from your office suite — they just want an outstanding product that serves their needs.

Thanks to today’s technological environment, the barriers to delivering and scaling a minimum viable product (MVP) have come down significantly. And, rather than invest heavily in building a company, we’ve found that the smarter strategy is to invest in building a product that satisfies our customers’ needs. By spending strategically on R&D to deliver a solution that brings value for the customer, it’s entirely possible to build a company without a headquarters, without relinquishing control to venture investors, and without a huge and expensive sales team. Here’s how:

1. Focus on building the product your customers need.

Creating a proof of concept or MVP should take only two or three people if they’re focused on the customers’ needs. Rather than building out a ton of features right away, start simple to deliver faster and gather customer feedback, then iterate and build out what and when it adds value for the customer. This can significantly reduce the upfront development costs and get your product in front of the customer sooner, where it can start earning revenue.

Related: Eric Ries on 4 Common Misconceptions About Lean Startup

2. Turn your product team into a go-to-market team and sell by referrals.

Too often in big capital raises, I see companies invest a little in their product and a lot on go-to-market (GTM) teams. This results in a mediocre product with development needs that get obfuscated by a big sales team. Instead, leverage the team who built it to sell it. In our case at PowerInbox, that GTM team was a shared responsibility between myself, our head of product and one other individual. We delivered value to the customer, which resulted in references and referrals that connected us to the next sale.

3. Scale staff only when the need is clear.

A lot of companies looking to grow will base their staffing needs on a revenue target model: If a single sales rep can bring in X amount of revenue, and they need to generate 5X more revenue, then they’ll hire five more reps with the corresponding support staff. That’s conjecture, and forecasting based on assumptions. Instead, only add new staff when you can clearly demonstrate how it will directly expand your ability to bring on new business. Make sure your existing staff is working as efficiently as possible and challenge them to deliver at their fullest potential. At PowerInbox, this approach has allowed us to operate at a much higher revenue run rate with a much smaller staff compared to our peers.

Related: 4 Things Your Company Can Do Without When Starting Up

4. Don’t waste money on an HQ.

The conventional argument for an operations HQ is primarily collaboration: Managers need to see their employees daily to discuss goals, provide coaching and oversee their progress. But, the reality is that technology makes this cost unnecessary. There are plenty of tools that enable our entire team to work remotely, check-in frequently with managers and collaborate from their own homes. We use cloud-based tools that make it easy to basically plug in a laptop anywhere and be productive.

And, because we deal with so many people across multiple time zones, meeting time is at a premium. That means we avoid the typical recurring “status meetings” that mostly just waste time anyway. When we do get together, it’s for a valid reason, extremely productive and to the point. We’re incredibly more efficient this way and the less time and money we waste, the more we can invest in growing our bottom line.

Related: How I Stopped Hustling and Started Succeeding

5. Encourage team-building outside of the office.

When you don’t see each other in person every day, there is a risk that you might lose a bit of the connection and rapport that are so critical for successful teammates. But, rather than force them into work-related meetings, instead we encourage our team to get together for dinner or group activities outside the office. This does more to build relationships, encourage communication and foster accountability than a weekly huddle around a conference table in an over-priced office space.

6. Hire smart.

This kind of flexible environment isn’t for everyone. Working remotely requires discipline and drive, and even the most skilled employee may not be suitable for the commitment it requires. In our company, I don’t know when someone comes to work or how many hours they log. But, I do know how they perform, and that’s what matters most. Here, our staff leans a bit older than is probably typical for high-tech startups in our space. But, our seasoned staff doesn’t need us to waste time managing their time. They hold each other accountable on their outcomes, which is what really matters for growth.

Related: How I Built an $18 Million Company With No VC Funding – and How You Can Too

7. Go after small capital investment.

For some entrepreneurs, nailing down a huge venture round is in itself an indication of success. The problem is that large investments come with larger expectations. Bigger raises have bigger exits and typically less control for the founder. Instead, raise smaller amounts early to gain traction and manage expectations. In order to stay lean and nimble, take as little outside funding as possible — just enough that fits with your model. You’ll maintain more control and your sanity.

You’re probably thinking, “But, how will we gain traction in the market with a small sales and marketing budget and no corporate machine behind us?” While it’s true that news about big investments, new hires and company expansions garners headlines and earns the big spenders name recognition, the question becomes just how sustainable is that strategy? As a buyer of technology, I’d sooner bet on a lean company with a winning product than a bigger company that’s burning through money, reliant on VCs and has minimal control over its future.

For leaner, nimble startups, the goal must be to set yourself apart with a superior product at an attractive price point so that customers recognize you for what your product can deliver for them, not because you’re good at chest-beating. The quicker you can get to profitability, the more control you have over your future and the more likely that growth will continue.

Related Video: What You Can Learn From This Serial CEO

A daily source of inspiration and information, Entrepreneur.com fuels the spectrum of game-changers that define what it means to be an entrepreneur today. That includes business leaders who launched something from nothing, content creators in the social influencer space, athletes pushing the boundaries of performance, and internal thought leaders innovating inside major corporations. Entrepreneur.com offers strategic insights and how-to guidance for the people that make things happen.

Advertisement

Business

Unilever Turns Up the Heat on Facebook & Google Over Tech’s ‘Unintended Consequences’

Social Media Week

Published

on

Business

photo

Unilever has issued a stern warning to digital platforms including Facebook, Google, and YouTube: do more to improve transparency and clean up the “swamp” of fake news, exploitative, and socially divisive content, or be cut off from its multi-billion dollar digital advertising budget.

CMO Keith Weed recently spoke at the Interactive Advertising Bureau’s annual leadership meeting held in Palm Desert, Calif. CNBC quotes him as saying, “We need to redefine what is responsible business in the digital age because for all of the good the tech companies are doing, there’s some unintended consequences that now need addressing.”

Two of the most important consequences being referred to include the threatening of safety of users, especially young children, and loss of trust by consumers and companies at large.

While it’s unlikely that Unilever will turn its back on the two largest digital platforms, Weed’s words matter because of the sheer amount of ad budget Unilever holds across its portfolio brands. MediaPost reports that in 2017, the company spent approximately $9.8 billion on marketing and advertising, a quarter of which went to digital.

Beyond the public denouncements, Unilever is also working with IBM to develop a blockchain with which the company can more effectively reduce ad fraud via a record of what media is purchased and how it is delivered.

A separate MediaPost article shares YouTube CEO Susan Wojcicki’s response to Weeds comments on Monday. In her own statement at Recode’s Code Media conference, she assured,
“We want to do the right set of things to build [Unilever’s] trust. They are building brands on YouTube, and we want to be sure that our brand is the right place to build their brand.”

Recent efforts we’ve seen in support of this include significant updates to its Creator Program policy. Further, in light of the recent Logan Paul controversy involving a video in which a suicide victim was filmed inside a Japanese forest, the company has suspended running ads on his channel, per Ad Age.

While brand safety is a concern on the minds of many marketers, Unilever’s public comments this week indicate that brands are viewing the issue with a much broader lens, and seriously questioning the role these platforms play in people’s everyday lives, beyond the world of advertising. In this important cultural moment, people are looking to brands and platforms to assume responsibility and be proactive to keep their spaces safe, trustworthy, and suitable for communities.

To further explore the overarching question of how technology, including digital platform giants, can be used to bring us closer together versus further apart, join us at SMWNYC April 24-27. Register today and save 20%.

Continue Reading

Business

Facebook’s Next Step in Building Community: $10M in Grants

Social Media Week

Published

on

Business

photo

Facebook has made several important announcements as of late the support its mission to create more “meaningful communities.” The latest? Investment in a newly announced Community Leadership program designed to support its community-building leaders through a variety of residency and fellowship opportunities that offer training, support, and funding.

Here’s how it will work: Facebook will name five “community leaders in residence” and provide up to $1 million each to fund their proposals, in addition to providing them with the opportunity to attend a customized leadership development training session.

Moreover, Facebook will select 100 individuals to join its fellowship program and receive up to $50,000 each for a “specific community initiative.” They’ll also participate in four in-person gatherings during which they will have the chance to meet and collaborate with other fellows.

Another key initiative in the works? Expanding Facebook’s “engineering team for community safety,” which is headquartered in London. In particular, the company hopes to double the number of employees focused on such efforts including detecting and stopping fake accounts, protecting people from harm (e.g harassment and scams), and making it easier to report content, by the end of 2018.

Further, Facebook outlined new tools for group admins, including page personalization options (e.g. color and the ability to pin announcements to the top of the page), the ability to create and share group rules; and more features to monitor Group Insights.

Outside of its Communities Summit, but along the theme of ensuring time on the platform is time well spent, the company also confirmed last week it was testing a downvote button that would allow users to provide feedback on comments in particular. The downvote button is being tested within a limited group of U.S. users for the time being.

This is not to be confused with a “dislike” button, but rather a more “lightweight way for people to provide a signal to Facebook that a comment is inappropriate, uncivil, or misleading”—this according to a Facebook spokesperson quoted in TechCrunch.

Here is what the button looks like in action:

Image via TechCrunch.

As the screenshot depicts, the user will have the ability to select whether the post was found to be “offensive,” “misleading,” or “off topic,” the choices aimed to help guide Facebook’s course of action with respect to the particular piece of feedback.

Forbes adds that, the downvote option in its test mode only applies to public posts as opposed to Group posts or the Pages of public figures. It also doesn’t affect the ranking of the post and the number of downvotes a post gets won’t be publicly shared.

These initiatives by Facebook to reverse some of the negative perceptions of its role in society come at a critical time as brands and citizens alike are putting more and more pressure on the world’s leading tech platforms to course-correct their products for the safety of their users. Just this week, Unilever threatened to yank ad dollars from Facebook and Google due to the company’s growing dissatisfaction with their overall impact on society.

“We cannot have an environment where our consumers don’t trust what they see online,” stated Unilever CMO, Keith Weed, to the BBC.

Learn about Facebook’s increasingly complex role in society by joining SMWNYC April 24-27. The conference will offer multiple sessions designed to explore where brands and platforms fit into tech’s future in our world. Register today to secure your pass.

Continue Reading

Business

5 Ways Cryptocurrency Can Help Entrepreneurs in 2018

Entrepreneur

Published

on

Cryptocurrency has revolutionized the way we transact value, invest our savings and raise capital with its decentralised digital cash system. Blockchain technology is a once-in-a-lifetime invention; never before in history have we been presented with such a breakthrough in financial technology. In 2018, entrepreneurs are well positioned to become early adopters of blockchain technology.

1. Raising capital

Cryptocurrency has disrupted the way early stage companies raise capital. With initial coin offerings, startups around the world can raise money quickly and cheaply from a wide pool of global investors. The valuation of a company is almost immediately reflected by the market, a process that has traditionally been challenging for early stage businesses. Shares are issued as tokens and tradable almost immediately, bringing large amounts of liquidity to the company.

Related: IPOs Are Boring But You Must Keep an Eye on These 9 Initial Coin Offerings

This new approach to raising capital has changed the world and enabled the best technical talent to build their companies at high speed. In 2014, a teenager from Canada called Vitalik Buterin raised money for his startup, Ethereum, through an initial coin offering. He wanted to improve on Bitcoin’s blockchain and create a platform for people to build unstoppable applications. With just a whitepaper and a vision, he was able to successfully raise $18 million for his new blockchain, which was valued at over $100 billion as of January 2018.

2. Transacting value

Cryptocurrency enables us to transact value between peers without a centralized authority. It provides a cheaper, faster and more efficient alternative to traditional payment networks. As a company, accepting cryptocurrency payments is becoming increasingly efficient, saving on fees and bringing faster settlement. Soon, startups will no longer need to go through the long process of setting up a business bank account to receive and distribute funds. In 2014, Overstock.com became the first retailer to accept bitcoin, receiving over 800 orders worth $126,000 in bitcoin in the first 22 hours. It has since amassed a $403,000 portfolio of cryptocurrency.

Related: 5 Essential Podcasts for Entrepreneurs Serious About Cryptocurrency

3. Investing for the future

For entrepreneurs, cryptocurrency may be the investment opportunity of a lifetime. Never before in history have retail investors had investment access to high growth early stage companies. Traditionally, venture capital funds and private angel investors have held monopolies on access to investment in the world’s best technical talent. Cryptocurrency provides a gateway for anyone in the world to invest in the world’s most exciting technology, allowing retail investors to own a basket of high growth companies. For example, through the decentralized method of blockchain investment, teenager Erik Finnman was able to invest in Bitcoin in 2011, becoming a Bitcoin millionaire at age 18. These types of investment stories would not be possible with traditional private venture capital fundraising.

Related: Why You Can’t Afford to Ignore Cryptocurrencies and Blockchain Anymore

4. Developing on the blockchain

The blockchain offers powerful infrastructure for companies to run their technology and create entirely new business models in a trusted way without a centralized authority. Blockchain technology is already revolutionizing the way startups create value. The Ethereum platform allows companies to build unstoppable blockchain applications quickly and for free. One example of a company leveraging the Ethereum blockchain is OmiseGO, a payments company that is using blockchain to provide banking services for the world’s 2 billion unbanked population. Blockchain technology is a cost-efficient way of building decentralized applications that can scale to a global population.

Related: 6 Cryptocurrencies You Should Know About (and None of Them Are Bitcoin)

5. Joining the blockchain community

The blockchain community offers access to some of the world’s best entrepreneurs, who are actively investing, advising and building upon the blockchain. Telegram, Facebook, WeChat, Slack and WhatsApp groups have proved popular in building communities of decentralized blockchain investors who can communicate with each other on a daily basis. Many large investments in early stage technology companies can be coordinated within minutes, a process that would traditionally take months in traditional venture capital. For example, in 2017, Brave’s Basic Attention Token sale sold out of its $35 million offering within 30 seconds. The blockchain community offers a strong sense of purpose with all members committed to a common goal of advancing blockchain technology to global adoption.

Related: How Digital Wallets and Mobile Payments Are Evolving and What It Means for You

Cryptocurrency provides a platform for entrepreneurs to raise capital quickly, cheaply and efficiently. Entrepreneurs can transact value through the blockchain at high speed with limited setup costs and invest in high growth technology companies at an early stage. Platforms like Ethereum allow entrepreneurs to build decentralized applications to a global audience for free. The blockchain community offers access to some of the top entrepreneurs, engineers and investors in the world and in 2018, cryptocurrency will continue to provide a viable means for entrepreneurs to create value in the world.

Continue Reading

Business

7 Ways to Get Recruiters and Job Offers to Come to You

Entrepreneur

Published

on

“You are your own brand, and you need to build that brand and promote it as much as possible. It is important that you start building your brand online, because this is where employers are going to be looking for potential employees,” suggests Dima Midon, an expert from TrafficBox. Use all of the online tools at your disposal, particularly LinkedIn, which is a professional network that allows you to really promote yourself as a professional, and someone who is an expert in your field. This is a great tool for job seekers. Make sure that you keep your profile up to date, especially when it comes to contact information, so when an employer searches you, they will be able to contact you if they are interested in learning more.

Continue Reading

Tags

Trending