A Product Market Fit Show | Startup Podcast for Founders
00:39:15 · Rafael Broshi, Pablo Srugo
So it's always a blend between KPIs and story, and the more competitive the market is, the more fine tuned your story needs to be on how you're going to win at something. That's what everyone wants to bet on. [00:39:28] S2: Yeah, you need to find that kind of sweet spot between, because obviously if you narrow it too much, then you're like, oh, but then that's too small of a market. It's too niche. So you've got to find that sweet spot where the opportunity is still big. You could still create a five to ten billion dollar company. But you're clearly going all in in a certain direction, in a certain position that nobody else is really going all in on. That doesn't mean they don't compete. They compete there, but it's like, hey, they're actually spending seventy percent of their time doing this stuff and I'm spending a hundred percent of my time doing this thing. So we'll cross over, but frankly, we'll probably beat them most of the time in this place. Because we're all in on this place, you know, something like that.
00:40:03 · Rafael Broshi
[00:40:03] S0: And I also think about it a bit differently in the sense of, I do think that every time I go on a call with the VC. That VC probably wants me to be the best founder that they've ever met. I mean, that's their job. They want to invest. When I interview people, if I interview six people a day. I don't go in saying, oh, this guy, I'm sure he's not going to be good, right? The guy goes into my interview, all I want right now is for this person to blow me away. That's all I want. So that's what VCs want as well, right? They meet startups. They want to say, oh my God, this guy's the best founder with the best story I've ever met. This is the craziest company, is going to be worth trillions of dollars, right? You just have to give them a reason why this is the case and if you cannot give them a reason why this is the case, then you should not be surprised why they don't want to invest in you. That's all. Now, if you're a good enough grade, then you're not going to get money from Sequoia. You're going to get money from others. Maybe you are that good, but maybe right now you had a bad round. Maybe you were scaling the business, right? Maybe you did a lot of other things while other people grabbed the market. No one knows what's gonna happen in two years, right? Some companies struggle in their A, some companies struggle in their B, some companies struggle in their C. Most companies struggle somewhere, most companies, right? So it shouldn't bother you, right? You have to raise, otherwise you're gonna die. But if you're raising, you need to do, I would say, the minimum amount between perfecting the raise versus perfecting what you believe is the right strategy for the company. Hopefully those two align, but sometimes they don't completely.
00:41:48 · Pablo Srugo
[00:41:48] S2: So let's spend the last few minutes just going very tactical. You've been selling to Enterprise for a few years now and I mean, nothing is easy. But I think especially when it's a small startup selling to a large enterprise, there's always something about that that is especially hard. Tell me a little bit, maybe some lessons learned, some tactics that founders can really use when they're selling enterprise. Maybe let's start at the top. The first part being you've got to get in the room. I mean, you've got to actually get somebody to listen to you, to hear you. Which you can't do through Google AdWords or Facebook ads or the sort of things that might work in SMB or mid market. How do you get the right people in the room to begin with?
00:42:24 · Rafael Broshi
[00:42:24] S0: First of all, there is no formula for that. At the end of the day, it's all about connection and relationship. And the higher up you manage to build a relationship with, the better this is going to be. Now, you cannot just work the CEO. The CEO of a larger company, he might be the decision maker. He might weigh things your way, but he's not gonna get you to the POC if you don't do a good job with innovation. OK, so you have to work both ways, bottom up and up down. And up down, that's using all of your relations. Just hustle, hustle, hustle, hustle. That's all it is. Use all of your investors, use all of your employees, use your father, use your mother, use your brothers, use your sisters, use everyone you know. Everyone wants to help you. Everyone wants to help. If you're gonna ask help, everyone's gonna say yes. I really, I've never had anyone say no to me. I had people say, well, I don't know this guy. I'm not sure, maybe you can speak to this guy. Just ask, if you don't know him, who do you know, is there anyone else that can help me? A lot of people think that they need to come in a superior place asking for help and not really saying, hey, I really need your help, right? I need to close a sale there and I'm really looking for some from the company. Can you help me? It's much more sincere and people wanna see this kind of vulnerability. Everyone has it, I think, and again, I'm trying to be there. But I think the best founders that I see out there are those ones that, they don't care to put themselves out there. So that's one, in terms of coming from below. If you start talking to someone in the working level or talks with you in the first calls and you throw out too much that you came in through the CEO. This will not end well for you. You have to respect every person you talk to and you have to give them what they want and not what you have. It is fine to say, I don't have this, but listen to them and it's extremely hard, right? You want to sell what you have, but it is not how people buy. OK, and usually you might say, and I see this a lot where you say, well, but I'm talking to a company. An enterprise, and they don't have a pain point. I said, OK, great. If they don't have a pain point, you have nothing to sell. It doesn't matter what you're going to give them. It's fine, so just use the conversation to ask questions.
00:44:45 · Rafael Broshi
What do they care about? They care about something. If you go on a call and a person say, well, yeah, I don't care about anything, right? I'm just here to pass the time. By the way, it does happen. It does happen, rarely, but it does happen that. Well, it's fine, you know, talk to him about life. But I think that's the key thing. Second, something that we didn't do as well when we started is thinking that in order to get an enterprise contract, you must slowly move up the ladder. I think there is zero connection between getting an enterprise deal and going from $10K to $50K to $100K to $200K, OK. It's just the fact that it's a rule of numbers, out of a hundred enterprises you're going to talk to, only probably five to ten of them will even consider working with a startup. So that's one. OK, ninety put aside, not relevant. Out of the five to ten, five might say, well, you know, I want more logos. They wouldn't care what and some might say, you know, that's fine. You know, one, you just need one. So I'm not saying don't try. Obviously, it's much easier when you have twenty logos. But it also happened to me where I had a lot of logos and the person said, well, you know, you don't have a company that does exactly this at that size, so it's not relevant. I'm like, so you want me to find the same company in a parallel universe? And then you figure out the real problems. Usually when you hear no, it's not just that you don't have specific clients. It's that something didn't add up. It's like when people tell you, hey, when an investor, when a VC says, no, I don't want to invest, right? Just take the no. Sometimes the response is not that accurate. Because why would they tell you, hey, I would never invest in you. I didn't like you, right? Never, it's either too early and it makes total sense when you think about it. So the same thing here, right? When people, when enterprise tells you, hey, you need more logos, the reason is probably different. OK, now the more logos you have, the easier it is because you have credibility. So they'll start by thinking that you probably have something to offer them. But if you don't, it's just about really pinpointing the pain point, OK. If someone can solve the exact thing you're looking for, usually you wouldn't care. At least not in meeting number one, meeting number two. Maybe you're going to fail security, right?
00:47:07 · Rafael Broshi, Pablo Srugo
That's fine, but you're going to get through those meetings. So I would say try to be extremely skeptic in what you sell and try to be very sharp in how you debrief what happened on the call in terms of, did I hit their pain point? And if not, why? Person didn't want to tell me, the pitch was off, my positioning sucks. It's usually that people always escape to my product's not good, the company doesn't care, they want us to have more logos. But it's not that most of the time. So I think all of the tips revolve around those points. [00:47:39] S2: The no's are kind of easy in the sense that someone's like, I'm not interested. No pain point, OK, move on, right? And then the yes's are great. But there's these middle ones where it's like, yeah, we've been talking to them. They're interested. Maybe we even did either a proof of concept or an actual pilot. You did something, you signed some sort of initial MOU, like something, right? And it's just, but it's not getting you there. You're not getting to that final contract. Sometimes it's just, that's what it is. It takes six months, it takes twelve months and sometimes you're just wasting your time. How can you tease those two apart?