Help us help you get that business partnership you want!

During my door to door salesman days, I could go through a wall if that meant I would get a referral to a potential sale. My team and I created, and memorized closes to secure referrals. My managers and I tracked how many transactions took place from referrals, and we pulled up salespeople that had low referral closes. It is clear to any salesperson that a referral is worth its weight in gold – it is a job half done.

Continuing in the same vein, now more than ever, founders are on the lookout for business partnerships to increase business avenues, and you must know that your investor has access to a vast network of people. Your investors’ immediate network has access to an even more extensive network, i.e., your investors know some people that know some people who are very important people.

So why is it that most founders fail at utilizing our reach?

A majority of the investors have every intention of helping you, but here is another critical question.

Have you made it easy for us to help you?

Despite best intentions (and regardless of the size of the fund or team), we have a limited amount of time and resources to address the needs of founders. A little bit of help from you would make it easy for us to help you. Your help would help us get more done in a shorter time and make you and us happy.

Therefore I came up with a list of steps, distilled from my efforts in securing referrals, whether it be for investors into our fund or for business development. Besides, I analyzed the efforts of founders who got the best out of their investors and those that failed at leveraging them, and the result was more straightforward than I would have envisioned when I began writing this list.

  1. Self-research on your target connect.

Venture capitalists have thousands, if not tens of thousands of contacts, and we are very adept at networking and finding people. However, you need to do your research on the people you want us to connect you with.

Usually, your reason to connect with the target is very different from why (or how) we connected with them. Our personal experiences could bias our opinion with your target, i.e., we could have approached them to invest in our fund, and they refused?

Therefore you should do your research on the target, utilize our knowledge about them to sharpen your understanding and find out whether an association with your target would be fruitful.

  1. Be as specific as you can in what you seek

It is a known fact that the most sought after people have the least amount of time. It is likelier that those people have an even shorter attention span. Therefore you must grab their attention, deliver your request before a notification takes your target onto another window.

Therefore avoid long-winded emails and big paragraphs, write in point format, be specific and get to the point quickly. When you show respect for your target’s time (and attention), it speaks volumes about how well you understand their position.

PS: Do not forget to be courteous & spell check!

  1. Know ‘why’ would your target want to work with you

If you or your company is the ultimate beneficiary of your proposal, expect a long period of silences to your requests. You must find a win-win situation and communicate how your association with the target would benefit the benefits them directly or their company.

If you cannot find or demonstrate the benefits of the association for the target – why would they get out of their chair to help you?

PS: If your strategy is to appeal to your target’s charitable side – please find a better reason.

  1. Create a short presentation (or note) on your proposal

After analyzing 40 million emails, Hubspot reported that emails with less than 200 words had the highest response rates. It is sage advice.

It is an excellent chance that your target receives hundreds if not thousands of emails in a week. Your warm introduction through us would encourage the target to etch out time to respond. However, long emails get flagged for reading when we have more time. Which (in most cases) I don’t.

There is a hack, though:

  • Create a short presentation (5-8 slides max) that outlines your research on your target, defines what you do, what you can do for your target, and how your proposal creates a win for the target.
  • Your presentation should excite them to get in touch with you (or get the relevant person from their team to get in touch with you)
  • Write an interesting note that generates enough excitement for the target to open your presentation.

  1. Get your investors’ buy-in.

Once you have found a win-win, written an action invoking short note to go with a presentation that will get you a callback, next, get your investor’s buy-in.

Some founders treat their investors as gofers who should do the founder’s bidding regardless of the investor buying into the proposed plan. You must understand that it takes much effort to create and cultivate relationships. Just one poorly-thought-out request could ruin that relationship for the foreseeable future.

If we get bought into your well thought out plan, and you can convey how we could enrich our relationship (with the target) through your proposal. You would’ve created a win-win-win that will get us to go those extra miles for you.

  1. Write a short, courteous but direct introduction email to your investor asking for your specific help from the target

With your investor bought in, write a quick introductory email asking for a specific connection to your target utilizing the steps outlined above. Your email must convey that you were specifically looking for an introduction to the target (and why).

Emails that convey a spray & pray approach get treated as spam.

  1. Draft the email for your investor

For extra credit (and to ensure that your message isn’t lost), go ahead and write the email that your investor could copy, paste, as their own words, and forward the email you sent in step 6.

It is unlikely that your words will get copy-pasted in the form that you’ve sent it in. However, your words will load our words when we write our email, thereby ensuring a near-total control to you on the messaging.

PS: It won’t take but an extra few minutes, but knowing how busy and dynamic an investor’s day could be, you leaving anything to chance is foolhardy.

  1. Give them a way out

Your target must have a courteous way of saying ‘no’ to your investor. I have explained before that each relationship takes much effort; therefore, the target’s failure to help you through your investor should not lead to a loss of the connection itself.

We want to help you, but if that means it puts our relationships on the line – it isn’t the sort of song that you wish to play in the back of our head.

PS: Give your investor a way out too. You can utilize this forgiven favor soon! 🙂

How to sell anything to anybody

I did several part-time jobs while in college but the only part-time job that I held for all the four years of my degree was as a salesman in a jewelry store. The managing partner of the store and still like an elder brother to me, Haresh, gave me this book, How to sell anything to anybody by Joe Girard. Haresh considered this book to be his bible on sales, and once I read it, it was my sales bible too. However, this book is not about sales.

This book is about creating a systematic approach to

  • Recruiting new customers without burning a hole in your pocket
  • Getting your customers to like you
  • Getting your customers emotionally attached to the product
  • Attaining (and maintaining) a high closing percentage
  • Engaging with your customers even if they don’t buy right away
  • Engaging with your customers after you have made the sale 
  • Getting referrals from customers, friends, family and service providers (including your barber!) to grow your business
  • Creating a team around you to ensure you get the highest return for your own time

Joe Girard sold 13,001 cars in his sales career. That is a staggering number because his sales career ended in 1978 i.e. way before the internet; WhatsApp or Facebook made it easy to reach out to a customer.

Joe was profiling his customers, listening to their needs, adjusting his approach to sell his customer. He also made several sales by reaching out to his customer just at the time that their car was ready to be replaced!

How did he know when to call? He kept all this valuable information on his customer in a physical CRM i.e., way before Salesforce, Dynamics, PipeDrive, etc. made record-keeping infinitesimally easier. 

It is for these reasons that this book is a must-read for all founders whether they handle the sales function or not because as I had mentioned before this is a book about creating systems. Therefore I recommend that every founder know how to support the sales function whether they sit in tech, operations, HR, or fundraising.

I have re-read this book several times in my career. Most recently, I re-read this book to create a system to approach, engage, and recruit LPs for my fund. The system ensured that only 13% of the 115 crores we have in commitments came from distribution relationships. Therefore, in the remaining 87% of the cases, I utilized Joe’s system to recruit, involve, and close LPs. My team used a CRM to manage follow-ups and we created new content to reach out to our LPs.

This approach saved us almost one crore a year in paying out fees to distributors, which is a massive cost saving for a MicroVC fund like ours. What is the investment?

Rs. 280 and 8 hours of reading time.

You don’t require a finance degree to explain that these are fantastic returns on your investment and time.

Now it’s up to you…

My atrocious car buying experience is a lesson in after sales treatment for all founders!

I am re-reading How to Sell Anything to Anybody by Joe Girard (book review coming soon).
Earlier today, I finished his chapter on Winning After the Close wherein Joe talks about the importance of ensuring customer satisfaction AFTER completing a sale. He gives examples of how he goes out of his way to ensure that his customers sing his praises to their friends and family. He links the importance of satisfying his customer to the Girard’s Law of 250, i.e., each person has a direct connect to 250 people; therefore, an unhappy customer can directly influence 250 people. Consequently a salesperson or a business that disappoints two customers a week will have 26,000 negative influence every year!
Why is it important to follow what Joe Girard says? For starters, the man still holds the Guinness Book of World Records for being the most successful car salesman in history. This man was selling six cars a day (on average) while the average salesman struggled to sell one. He was out making $500,000 a year selling cars in the 1970s, i.e., eight times the per capita income in the US of A – TODAY!
So yes, when that man says something – it is worth our time and attention.
I am coming back to my point for the post today.
I just bought my first car in India. It was an important moment for my team and me. We were ecstatic on getting the car delivered on Tuesday evening. However, instead of reveling that moment and remembering it for the years to come, all we cannot forget is how the salespeople delivered the car with just enough fuel to get the vehicle to the closest petrol pump!
The saleswoman blamed the empty fuel tank on some dealership policy of ensuring that customers get a bone dry fuel tank. I could not disagree more with her firm, her firm’s strategy, and finally with the saleswoman herself. If she was so embarrassed about her firm’s stingy policy, she could have ensured a happy customer by filling up the tank herself – she would make more than the Rs. 2200 it cost me to fill the tank.
Buying a car is one of the most important purchases in one’s life. I can still remember, like yesterday, the first car I bought with the money I earned by working during the first summer semester in college – a 1996 Mercury Sable with a v6 engine. I was so proud of the car even though it was six years old at the time of purchase. The moment gives me goosebumps even today.
Then 17 years later I buy my first car in India, a Honda Civic, and it is an expensive car (for my standards), but it was delivered as though the dealership was running out of money. It left a sour taste and you won’t have to think hard whether this dealership (Arya Honda) will be recommended by me to anyone. The answer is no.
I must re-emphasize that a happy customer is the best salesperson. He/she will boast about his/her positive experiences to their closest network. On the other hand, an unhappy customer will tell anyone that would like to hear him/her of their negative experiences and feeling cheated by a car dealership. Unfortunately, these car dealerships operate under old maxims therefore continue to misread their customers. Any start-up founder that is reading this post should not.
Your customer whether they are B2C, B2B, B2B2C or B2B2B or B2B2B2C (and so on) must be happy with their purchase of your goods or services. To hide behind the veil of corporate policies is the old way of doing business, and you must ensure that your salespeople are sufficiently empowered to ensure post-sales customer satisfaction, at all costs! It is just as important that those negative experiences are corrected by changing policies and processes.
The process in which the company acquires a customer, gives them lousy experience, and allows the salespeople to blame an insane corporate policy is a sure indication of a deeper rot settled in that organisation.
A rot that every entrepreneur should guard their companies against the cost of all their corporate policies.

The Udupi Approach

In many cases, food-tech founders extend their line of products to capture as many customers as possible, if they aren’t convinced about the size of their target market. There is a business case for extending into multiple product lines to provide complementary options to a loyal target market, but the decision to go wide right at the start is like opening a new udupi restaurant in Mumbai  that serves all cuisines to cater to  every guest but loses its core of serving the udupicuisine. Therefore, I jokingly call a ‘go wide’ approach of an early stage founding team as the ‘udupi restaurant approach’ as this approach is harmful whether you are in food-tech or not.

Let’s be honest, sales matter. But when you have limited resources in an increasingly noisy world, the quality of sales matter even more. Therefore, it is important to build a niche and own that space in your target segment. That will make your customers your best salespeople i.e. they will recommend you to their network which will bring in tons of new customers. For example, when I randomly asked people in my network for the best place for South Indian food in South Mumbai the answer was Muthuswamy, for people in Central Mumbai it was Madras Café, in Bangalore it was MTR and in Hyderabad it was Chutneys. These people were willing to advocate why their recommendation was the best.

However, when I asked the same audience for the ‘best food place’s in their vicinity, – they were stumped. They almost immediately questioned me about what my preferred cuisine is, whether I was looking for a family restaurant or a date place, what my budget was etc. They did not know how to answer the question until they had some clearer direction. Can you imagine (now) what happens when your start-up does everything? Even your best and loyal customers will not know what to recommend you for!

What is dangerous is that they could be recommending you for something that isn’t even the path you planned.  More dangerously, the customer who is promoting your product may not even be in your target segment. And most dangerously, they may not be promoting you to people who fall under your target segment. Such a sale is more toxic than beneficial!

I understand that it is scary to be focussed but there is a lot of value in doing so. Customer feedback focussed on a concentrated product line will indicate whether you should pivot or accelerate your build-out. However, when there are multiple product lines catering to several audiences it pollutes the feedback, creating a lot of noise, making it hard for you to tune out the disturbance and assess what’s important in order to drive decisions – much like choosing what to eat at a Udupi restaurant at mealtime!

36/2019

The Matrix (for your sales program)

The way a company pays its sales people can make or kill the company’s sales program. Very rarely do I encounter a start-up that provides the right balance in base pay, incentives and minimum targets that motivate its sales force.
Base pay is the minimum amount a sales person will make whether they perform or not. I have always looked at the base pay as a draw against the minimum target that the salesperson is supposed to achieve in order to keep the base.
Matix of Paying Salespeople
Getting the sales program right is a delicate balance; It isn’t rocket science, just a simple understanding of human psychology. When a tech, operations or finance program creates the sales program it invariably ends up being lopsided. Therefore, in my opinion, the sales program should only be designed by a salesperson that is part of the core team and preferably the best sales person in the company. A bad sales program can destroy the best of companies.
How does your sales program fare on this matrix?
38/2018

Dont Quit

Looking out at the inclement weather from my car window I reminisced my days as a door-to-door sales agent. Door to Door sales could be an excruciatingly painful job on occasions when the inclement weather coincided with a day with no or low sales. It was at those times that this poem, “Don’t Quit”, shared with me by my boss, helped tremendously to tide over the tough days. My boss got this poem from his boss.
Later, when I became a manager, a founder and an investor. This poem helped me get over the tough days when the perfect storm brewed right above my head. At times like these that I recite this poem to myself – quietly.
 

Don’t Quit

When things go wrong, as they sometimes will,

When the road you’re trudging seems all uphill,

When the funds are low and the debts are high,

And you want to smile, but you have to sigh,

When care is pressing you down a bit,

Rest, if you must, but don’t you quit.

Life is queer with its twists and turns,

As every one of us sometimes learns,

And many a failure turns about,

When he might have won had he stuck it out;

Don’t give up though the pace seems slow–

You may succeed with another blow.

 

Often the goal is nearer than,

It seems to a faint and faltering man,

Often the struggler has given up,

When he might have captured the victor’s cup,

And he learned too late when the night slipped down,

How close he was to the golden crown.

 

Success is failure turned inside out–

The silver tint of the clouds of doubt,

And you never can tell how close you are,

It may be near when it seems so far,

So stick to the fight when you’re hardest hit–

It’s when things seem worst that you must not quit.

 
The poet remains anonymous. If you know who he/she is, please share it in the comments section.