How important is previous experience while building an enterprise venture?
Building a startup is hard work. Building an enterprise venture even harder, perhaps? What is an enterprise venture? A simple definition would be: any company that builds technology which is sold to other enterprises (of varied scales). Now, conventional wisdom would tell us that building such a venture would necessitate previous experience as you need to make inroads into bigger companies where you can pitch, and the need to understand the psyche of big corporations. We decided to test this hypothesis.
Girish Matrubootham is the CEO of FreshDesk, a growth stage startup in the online customer support space. Speaking from his experience, Girish says, “There are many things you need to understand in a B2B context that go beyond the product. For example, you need to understand organization structures, job responsibilities, buying process, key people who own the budget etc.” In such cases, the previous experience comes in handy. Krish, founder of ChargeBee, reinforces this and gives a couple of more reasons in support of having previous experience while building a B2B venture:
- You understand sales cycles and the relevance of influencer network better to close a sale while dealing with larger customers. You learn to be patient with larger deal closures and not lose focus on small customers who are likely to give you business now.
- With experience, you learn to dig deeper and understand real customer ‘needs’ than building features as requested.
Domain expertise and depth of understanding of a problem is another essential while building a B2B venture and this is best learnt on the job. But what if you’re fresh out of college or don’t really have experience of working with enterprises? Well, there are many who’ve showed that it can be done. Pallav Nadhani was only 17 when he started out with FusionCharts. InerviewStreet is another glowing example and so is Wingify.
Within B2B ventures as well, there are two kinds of channels: the smaller businesses and the large MNCs. Starting out by selling to startups and SMEs, building a reputation and then approaching bigger companies is surely one way of doing things by anyone with a good product and the knack to sell.
Folks with experience can go out for the big clients first up for their pilot, test out and then expand and branch out. Soumitra Sharma who was previously a VC with IDG Ventures is in support of the other side. “The rise of new-age enterprise tech themes such as analytics, digital security, enterprise mobility, Internet-of-Things etc. is creating white spaces that are ripe for younger entrepreneurs to exploit. Frankly, old-school experience – for example offshore services, ERP, CRM etc., is of little consequence in these rapidly-evolving areas,” says Soumitra.
He goes on to add that younger founders bring with them fresh design thinking, understanding user interface, behaviour and experience, and knowledge of the digital space. They are creating disruptive products, and supported by the Cloud, deploying them the world over. They are also acquiring customer leads on Twitter, via blogs and through their digital footprints. This is not to undermine the value of some grey hair in the leadership team; but the pace at which technology trends are evolving and business models changing, too much past experience and baggage might just become a hindrance to creating truly innovative companies. “To exploit the new emerging B2B white spaces, I would any day prefer fresh thinking and problem solving approach, over a decade of IT services experience and networks,” he adds.
This certainly opens it up for anyone who is building an enterprise venture. There are pros and cons but if you have the will and are open to learning from yours as well as others experiences it is possible to build an enterprise venture from any quarter.
Mark Suster laid out a great basic structure for anyone in the field to get into the mind of an enterprise buyer. If you crack the following, you’re pretty much sorted:
- Why buy anything? You need to go to a customer and be able to identify a problem and then persuade them why your technology will solve it.
- Why buy mine? Next, you need to persuade them why they should not be using other existing large companies and/or other startups that are selling the same thing. This comes down to having a USP (Unique Selling Proposition).
- Why buy now? You need to be able to identify enough pain and perceived benefit in your solution to get enough people to buy.
Here are some articles for further reading and do share your thoughts on the topic: