What do you do when the ship is going in the wrong direction? That's what I'm facing in the startup I'm running.
My partner and I set a course we thought was right and true. Our board and investors, a group of very intelligent people, thought our plan and logic were sound.
A year into our venture, we have little revenue to show for vast amounts of work. Day after day, we learn new things that cause us to reconsider our original strategy. Last month, I said I was tired of treading water, and I could see the team was getting frustrated. One of our top people even told me he would be looking for a new job at the end of the year if we didn't start making serious progress.
I have been down this path before, which is full of thorns and pain. This situation requires a serious reevaluation of the business model and success factors. We will cloister in a board room to evaluate the following:
We need to look at our value proposition.
- Strengths of our service
- Weaknesses of our service
- Adjectives that prospects have used to describe what they like about our service
We will look at the competition and evaluate the following:
- Price: Can we beat theirs?
- Service: We will honestly look at ourselves and determine if we truly offer a better service and, if not, where do we fall short? There may be things the competition is doing that we need to emulate.
The question for us is if we are selling to the right market, so we have to ask the following:
- What's the size of the companies having the greatest pain that our service can alleviate?
- Which industries would most likely use our service?
- Which geographic area should we target?
- Which companies will make the quickest decisions? The worst part of selling is being in limbo, where people tell you they like what you offer but don't make a decision.
We need to take a hard look at our sales process, which means taking it apart and flow-charting exactly what we do. We hired a 25-year-plus sales professional a couple of months ago and he asked us the following:
- Do you send the prospects a packet of information that they can touch so they can see what they are getting? The answer was "no." We told them verbally and in a PowerPoint presentation.
- Do you send them agreements, which you review when you sense an interest? We were sending the agreements by e-mail after they expressed an interest during an in-person meeting. We should have had the agreements with us so we could have gone over them.
We need to assess our team's core capabilities and look at the following:
- Do we have the right people in the right positions?
- Where do I add the greatest value? As the founder, I like to think I'm the top salesman, but I'm not a professional salesman. My strength is coming up with and selling ideas. It isn't on closing sales.
No one likes to admit the path they took is wrong, but you have to be honest with yourself and your team. You have to have the courage to put on the brakes, get out of the car, pull out the map and plot a new direction. We need to find customers who say they must have our service and stay away from companies where the competition offers a better value.
Marc Kramer, a serial entrepreneur, is the author of five books and is an instructor at the University of Pennsylvania's Wharton's Global Consulting Practicum, where he serves as Country Manager for Chile.