Sales are a craft with exactly defined key activities and statistics. What’s important for start-ups that address B2B customers is that they do sales personally and try to reach decision makers. The final goal of every start-up is getting to a systematized and optimized sales process, start getting income as soon as possible, thereby also proving that the product has achieved its product/market fit. The participants of the 7th educational module of the accelerator Start:up Geek House listened to all this advice, given by the experienced start-up mentor, entrepreneur and manager Darko Butina, who is currently building his new start-up company SASH reporting.
The interview with Darko Butina was made following a conversation led by Urban Lapajne, which was part of the 7th educational module of the accelerator Start:up Geek House and had guaranteed priceless first-hand advice to the participants.
What advice do you today give to start-ups starting to build their business model?
I frequently warn start-ups that it’s great that they want to be innovative and invent something new, but that people find it very hard to adapt, that we change and accept new things slowly. This is why I often tell start-ups that they don’t have to aim at disruptive high-impact innovations right from the very start, but rather try for improvements of already existing solutions, for the so-called incremental, smaller innovations, since they can succeed much faster on the market with those. Of course there is always the possibility of a start-up succeeding with a radical new solution, but that is much more difficult and takes longer, and practically 99 % of such attempts fail. That’s why it’s good to ask yourself whether it’s worth it to invest all this money and time, or whether you would be better off implementing an idea for which you can start to create income and cover costs sooner. Once you have a healthy core and a product that works, you can always start tackling new markets with an innovative upgrade or a more radical innovation.
… so start-ups should think about generating income and covering the costs of business as soon as possible?
Ever since the rise in popularity of various social media start-up stories, such as Twitter and Instagram, the number of users and their growth have been a very hot topic. But those are also companies that that have been doing business for years and still work at a loss. In my opinion, start-up companies should be focused on making profit as soon as possible and re-invest the income into growth. The question is whether a company will be profitable in the long term, as only that is the indicator that it has achieved the product/market fit. If I go back to social media start-ups – it isn’t necessary for them to start charging right away. They should get a critical mass of users and only then include profit, but it’s crucial that they know how they will get to this income.
How important is a good list of potential clients, does it pay off to pay for it?
Since a start-up always has to have its sales funnel in full view, a good list of contacts with the right phone numbers or e-mail addresses is so very important. It’s worth it to invest some effort, time and money into it. You can buy leads and contacts, you can address people on the street, ask friends, co-workers, colleagues, family, acquaintances… Use different business records. Today, you can’t do anything without LinkedIn or a business database such as Datafy.si, developed by your colleague from the accelerator. More general databases, such as Bizi or Gvin, are also good for a start. You can also generate contacts by yourself, by offering users useful content in exchange for their e-mail address – articles, newsletters, blogs, and of course the content you generate and share on social media.
The full interview is available in Slovenian at: http://startup.si/sl-si/novica/102/startupi-prodaja-je-obrt-vas-crm-je-lahko-excel-vas-koncni-cilj-pa-je-dobicek-