by Yann Girard — Get free updates of new posts hereTweet
The worst part about starting a B2B company are the extremely long sales cycles. Depending on the size of your potential customer it can take up to several months. Most of the time you won't even be able to close a deal. Instead you'll only be able to land a trial.
A trial that might (or might not) lead to future and predictable revenues. Who knows?
The thing is that most of us don't have that much time (and/or money) to wait for revenues trickling into our businesses in a few months or maybe even years from now on.
And that's what makes B2B businesses so pretty damn hard. That's what kills a lot of B2B startups out there. Underestimating the ultra long sales cycles and overestimating the potential short term payoffs.
It's also the basis of a question a lot of people asked me many times.
“How can we cut down B2B sales cycles”?
And my answer goes back to a post I wrote a few months ago. It was called “What your girlfriend, investors and customers have in common”.
The thing they all (including B2B customers) have in common is the fact that everyone is afraid to take any risk. Everyone out there is risk averse. Full of fear.
So the one thing we should try to do is to make them feel more comfortable about interacting with us. We need to decrease our opponent's risk of interacting with us (e.g. going out with us, buying our products, investing in our company).
And one way we can apply this logic in a B2B environment is to do something completely counter-intuitive. We temporarily drop the idea of building a B2B business in favor of a B2C model.
Here's why this makes sense:
We offer the product to end customers who will in almost all cases also be the people using the product at a corporation.
If we get a lot of end customers using the product this is a first proof of concept that people (the same people working in a corporation) like our product.
This reduces the risk of a corporation tremendously, as the people using the final B2B product within the corporation will also be individuals.
Decreasing a company's risk to implement your product (which was already successfully validated on the market) will ultimately lead to shorter sales cycles. It takes away the fear.
Generating faster revenues with the help of a B2C model can ultimately extend your company's survival while waiting for larger B2B deals at the same time.
I know that this doesn't necessarily apply to all B2B businesses out there, but I'd say it's definitely something worth considering if long B2B sales cycles are a concern.
I guess there are numerous examples of companies out there that started off (consciously or unconsciously) that way. Dropbox is a company that comes to mind. There might be more but I can't think of any at the moment.
Also note that I have never launched any B2B business yet. So this might be complete BS. Maybe. Who knows? Food for thought.
But as a matter of fact I was able to observe some interesting things happening to me lately, that sort of prove some of my thoughts.
Ever since I started offering my products, services or whatever you want to call it what I'm currently doing, I've received a few requests from company's that wanted to hire me full time.
By going the B2C route and more or less successfully offering my stuff directly to end customers the company's risk of hiring me was reduced. Less risk, higher probability to make business or hire me.
Honestly speaking, I guess I would probably never have been able to get into any of these companies if I approached them directly. I would have been a way too risky investment for them.
Now the fact that I refused all offers is a whole other story...