Lunch with Mark LaRosa and Kickstarter

I was having lunch other day with my friend and
sales/busines s development professsional Mark LaRosa of Quotacrush, in
NYC.  We both specialize in working
as the defacto sales VP’s for early stage VC’ funded companies or post start up companies looking to use our cost effective services before they ramp up their sales teams.
Mark is the consumate pro with a much higher patience level than I and
has the ability to completely turn around failing sales efforts.  I on the other hand prefer to target specific
market verticals and build sales pipelines based more on my instinct for
businesses that have a need for my client’s products or services in the short
to near term and build credible sales pipelines in which to hand off to management ( or Mark and then let him build out the team)
with a good head start in terms of revenue realized.
Mark could easily do what I do, but with my lack of patience, and strange DNA that enjoys making cold calls to C-suite executives (the more you make they fast become warm calls) and laser
focus and ability to pick up the phone on behalf of my clients suits my
personality.

Which brings me to my latest experience (trust me there is a sales theme here) regarding my becoming involved with a Documentary Film project
(oneillprod.com) and with an excellent site called Kickstarter.  My aim is to raise the necessary seed funding
for a well known published Author Terrence Real who’s book I will be using as a platform on
the major theme of (male depression) and as a subject matter expert.  Suffice it to say my proposal (which included
the rights to the book by a major publisher..i.e. ready audience) was
rejected on grounds that the subject matter did not fit the criteria.
Kickstarter takes a 5% fee on all projects that reach their funding
targets and that’s it’s cash flow model. It’s very effective, (assuming the
project meets their revenue goals) but if the project fails which I project at
least being 50% that do, maybe higher because many are not much more than quirky vanity
projects and scrolling thru the site you can actually see the end date with revenues raised(or not) to date, then Kickstarter gets zilch.  It’s all (revenue must be 100% ) or nothing for if you raise 45,000 and your goal was 46,000, you get nothing
and they are out the costs of setting up and hosting the video project and whatever else their costs are.

As a seasoned business developer and (IF for argument’s sake
Kickstarter is a pure business enterprise..not sure, but don’t tell that to thier VC backer) wouldn’t it be wise if
Kickstarter was able to look more seriously at projects like mine, large
budget (50K) which come with a high likelihood for early stage funding success
(my published, Oprah appearing Author).
Mark and I work for companies like this all the time who’s focus is more
business to business, (unlike Kickstarter, although there is a huge appeal factor
to Fortune 500 companies, another blog post perhaps) but whose need in the
short run is to maximize their startup capital and find the clients (like me in
this example) is what separates all those Y  startups (http://http://ycombinator.com/ from becoming irrelevant or
perhaps not making it to the next stage for future funding.

Kickstarter will do just fine in my opinion because they can
afford (I’m pretty sure) to fail 50% of the time or more with projects that never meet their funding objectives. However, most startups can’t
stand that kind of failure rate and with the VC cash burning brightly, and if they don’t have ready-made
corporate clients furnished from the VC partners and the board, then they had
better call Mark LaRosa fast! I may be still too busy battering down the Kickstarter door !!

A Fortune Cookie in a Japanese Restaurant…very
strange!”

Inspector Closeau, the Return of the Pink Panther

A critical component of success for companies Venture
Capital Firms fund is the need for the management of these companies be able to
execute the sales and business development strategies of the market sector
(ongoing) and to further develop new potential sources of revenue.  Preferably based NOT on fantasy or worse, on
an Outlier account that will never be duplicated but thus has launched a
thousand ships of wasted scarce capital of revenue projections that will never
materialize!

Actual revenue for post start-ups and even up to series A
funded companies may still be an allowable work in progress.  Having market intelligence provided by a
business development person who can actually discern if a strategy is working
and new market verticals are viable is crucial.

Case in point.

What happens when the Venture Backed VC company fails to
execute or worse (in my opinion) over promises to deliver revenue based on projections
that aren’t realizable or credible?  That
was the situation I found myself in recently on a post series A funded company
in the health care services vertical.

First I want to digress to a recent lunch, a good book and
China… (It’s relevant but not in the way you might think!).

I have been reading Jeffrey Bussgang’s excellent book,
Mastering the VC Game and I was having lunch with a very smart colleague who
besides being a great purveyor of wisdom in many things VC and beyond, also
happens to be Chinese American.  Our conversation
started with a quote from said book, from Chinese Venture Capitalist, Quan
Zhou, from IDG-Accel China where he notes that” People are always sending
him business plans but fail to contact him directly.  He wonders how well they will do at finding
customers and creating partnerships if they don’t have the chops to contact him
directly.” Many VC’s like Quan Zhou function like sales managers or
business development executives in the way the exploit their rolodex’s to reach
CEO’s directly, (this is what I do for my clients as well) on behalf of their
portfolio companies to help generate revenue and validate potential markets.

I began to share my recent experience of contacting key
decision makers in a new market vertical.
Their response for this company’s services was tepid at best.  My wise friend began to immediately nod her
head all too knowingly having seen this movie opening one too many times. She
likened the experience to going down the mine shaft full-bore instead of
probing…you were brought on after they had gone down the hole..and Cut the
Rope!  She was laughing, while I was
still wincing as I continued the rattle off my failed attempts to connect with management
and to communicate my lack of traction.

I was called in while the expedition canaries we had were
about to go on life support.  I thought I
was given a more vetted market and actually relished a bit of lighter lifting
than my usual task of starting to the drill and enlarge the mine shaft.  I was actually looking forward to some (I
have to admit) easier fare.  I assumed
that they had done their due diligence (I asked during my initial meeting) and
after my queries were all satisfied proceeded to start.

The time spent was frustrating (outside of learning this new
Health Care market place which is interesting and quite complex) for actively
developing a market sector that was previously un-touched by the company save
for one “Outlier.” The initial market and customer base (what got
them the VC funding in the first place).
Some VC’s will only fund revenue generators was an entirely different
market than what I was tasked to generate revenue in.  At the risk of inducing a coma on folks
outside the healthcare sector, the original market was a TPA (Third Party Administrator
vs. a Commercial Health Plan) which while seemingly inconsequential or
seemingly dis-similar to laypeople is kind of like saying that most of my ads
appearing in the Yellow Pages (hard copy) are of a similar platform to that of
a Commercial advertisement broadcast on CBS during Primetime.

I repeatedly told the Sales Manager (who reports the Board
where the VC has a seat…several) that this is going to be extremely
challenging for we were up against (huge in-house resources, staff expertise and
general inertia given the relative importance of this service to impact the bottom
line etc.).  A male decision maker at one
of the health plans told me that having his company go out and get us the data
we needed for a trial demo was about as palatable as his going out and getting
another colonoscopy…at least he knew how long that would take and what the
results would be!  Based on many such
conversations it was becoming clear that there were huge challenges ahead. I
asked the manager if he was concerned or if he concurred with my diagnosis.

Cut To: Blank stares..to outright hostility.  OK. Have you called on these guys yet? A
shrug and some veiled allusion to the outlier account.

I suggest to him that he go back to the board and VC and get
some high level leads.  His look told me
that he would rather visit the proctologist.

“You have uncovered more high level contacts than
anyone else thus far”!!  Yikes I
thought to myself.  More front line
troops were added since my deployment to buttress sales to go after this
“outlier” market.

I knew how this was going to play out in next board meeting
or two!  It can get really ugly when
mis-aligned projections come to light.
There will be layoffs.   I have
been in this position before..back in 2001 right at the U.S Tech bubble
bursting while working for a NJ based Medical Startup (I was so young…talk
about pain!!!) as THE Sales Manager.  I
was so flattered to have the position yet soooo naive when the lack of a
credible market (hence my sensitivity) came down on my head.  Why I am so focused on credible markets for
my clients.

However… This same sales manager when I told him that I
had frequented a local Chinese restaurant for lunch one day early in my tenure
asked…”How’s the sushi there…I heard it was good.”..I thought at
the time he must be joking or at least gave him the benefit of the doubt.

…I should have known!!!!!

You started the Company but you shouldn’t be selling or developing it.

A company Founder calls me up the other day and was looking to outsource the sales and business development function to an expert and he finds me at (www.oneillprod.com). So far so good!  However, before I can get my name out he starts to talk, and talk, and talk about himself some more and talk.  I have to FINALLY after seven minutes interrupt him to ask him about what exactly his company does or is exactly, (Right There a Very Bad Sign) and how I might be of service.

In my experience The Founder, President, Business Owners, Entrepreneurs of companies unless they started in sales should never be anywhere near the sales cycle unless they went to school with the decision maker!  And then they really don’t need me.

Good to Great business developers have to be good listeners and they have to be humble in the rigorous and gut busting task of getting to the Key Decision Maker.  All traits that in my experience Founders, Presidents and most C-Suite Executives lack.  It’s a shame for this guy has a good idea, some backers, requisite cash and maybe a reason for being with this business service… but if thinks he’s going to be able to help me in my work which he insists on doing.  No Way.  I can see the problem, My EAR is STILL ringing from the problem and the problem is HIM.  If this guy ever gets on the phone and participates in an on-line demo with a potential prospect were toast. 

If I spend hours making the calls, wooing the admins, getting the buy in from other departments, building my case internally and getting the requisite stakeholders involved and can  fully demonstrate the value add and have a time booked with a key Decision Maker, am I going to allow this person anywhere near that call?  No way and this is where were all heading.

Forget it!  Know when to say I don’t do listening and humility well. In this day  and age of full frontal assault in all things business, and the pace of executive life in general, getting to the decision maker is hard than ever, (please read my absolute favorite book on this subject how to sell to the C-Suite http://www.sellingtothec-suite.com/) and this opportunity is too valuable to waste.

All I ask is that you give me the tools and resources I need, show me all the ways this service or product is going to change the way you do things and make life easier at ABC Company and, make sure the web demo is perfect and works etc. And then please let me close the deal and if I need some internal resources for technical or product assistance then I’ll choose that person but it had better not be you.

I never returned his call for I knew this would be a lesson in futility and the better part of valor was to know when to say no. I’ve worked with these kind “leaders” and I’ve seen them run themselves and their companies into the ground.  I’m not going along for that ride!

Life is too short.

Why New Business startups need to budget for sales and business development

I just go off the phone with a very promising marketing/advertising company that has developed a great process for explaining new products and services to consumers, educate externally and internally for both profit and non-profit and the list goes on..

However,

They have not been able or willing to hire a full time business developer and are counting on current word of mouth, referrals on limited advertising to keep up with top line revenue growth.

Sorry…big mistake.  Just like you hire a project manager, an accountant/bookkeeper, technical/software developer, finance officer and operations personal….you need to hire a TOP Sales and Business Developer ASAP.

Or many of those first hires will be summarily given pink slips as soon as the leads, referrals and bigger deals fail to materialize in sufficient numbers. And they WILL DIMINISH without development!

 Trust me for I’ve been there and have been called in to save a few sinking ships…it’s rough to pull off…the competition has the edge, you’ve lost ground and now you need to deliver with some key staffers gone.

Don’t let this happen.  Hire a business developer and If I’m busy I will find one for you!  www.oneillprod.com

Sean O’Neill

Why outsourcing sales in the new new makes sense!

A notice to companies and stakeholders of all business regardless of size.  If you want to increase sales and build relationships during this difficult economic climate you should think about Outsourcing your sales function.

Why this makes so much financial and philosophical sense!

1- It’ costs less to hire an experienced proven sales and business developer like myself who is adept at the sales process and who loves to pick up the phone and talk to new decision makers on your behalf.  You’ll save up to 25% on all payroll, health care and 401-K (assuming that hasnt’ been cut) and lots of HR costs as well.

2- I can reach your decision makers much more quickly (why..because I sound like a grown up and have been doing it for 15 years and I sound good and ask good questions and then…I listen!) and some cases by asking questions quickly and smartly I can reach other Stakeholders and VIP’s who might have an interest in your product or service.

3- I can pass along lots of my experience, contacts and slew of product and market information on each and every call.  I can also grasp the key value add of my clients product and service more quickly and spend more time actually developing business instead of asking for you or other company members to explain to me what it is that we are selling!

PLUS..if it doesn’t work out or if you are not satisfied with my effort, (which is usually quite rare for I really take my time in making sure this will work for both parties) then your 25% savings make you look that much smarter by having used my services at www.oneillprod.com

Sean O’Neill