A 4-Phase Plan to Market an Early Stage Startup

Author:

Aurelien Mottier
Reading Time: 3 minutes

Episode

64

A 4-Phase Plan to Market an Early Stage Startup

Aurelien Mottier

CEO at Operatix

Martina Lauchengco

Operating Partner at Costanoa Ventures

Marketing at early-stage startups can be tricky.

On one hand, startups are looking to set organizational policies and practices that will establish a foundation for long term growth. On the other hand, there’s pressure from VCs and founders to grow at a dizzying pace.

 Martina Lauchengco has some wonderful insights on the subject.

She’s an operating partner at Costanoa Ventures, where they’re investing in B2B Saas, data, cybersecurity, infrastructure, vertical SaaS applications, and aquafarming. She offered some frank advice to early-stage startups on our B2B Revenue Acceleration Podcast.

Here are some of the highlights from that interview:

4 phases of early-stage startups:

Martina said there are 4 phases of early-stage startups, and successful startups must progress through all of them, and understand all of them if they are to find continual successful growth.

Phase 1: Founder selling

In phase 1, the key issues you are trying to understand and identify are:

  • What does this market need?
  • What problems can I solve?
  • What are the right ways to go to this market?

The answers to these questions will guide how the product is built.

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The most important thing is to have an intersection between thoughtful ways of disrupting an industry – then to go to market in a differentiated way.

Martina Lauchengco – Operating Partner at Costanoa Ventures

Phase 2: Product-market fit validation

In this phase, you will have one or many “MVP” ideas out in the market (based on your understanding and research from phase 1). You are receiving some validation on whether those ideas are going to be adopted by the market.

Something to remember: The goal isn’t just to have people say, “Yeah, that product would be useful.” Frankly, people are nice. So, hearing, “That would be useful,” doesn’t signal a product that would be rapidly adopted by the market in general.

It’s imperative that the bar is higher, because, in today’s rapidly evolving marketplace, 20 other people with 20 other ideas are targeting the same segment you are.

The attitude you want to hear from a market is: “I need to buy that right now — my life would be changed if I had that product.”

Phase 3: Go-to-market fit validation

This could also be called “determining the who.”

Phase 2 and phase 3 are not necessarily sequential — because, often, who you are talking to determines whether and how a product will actually be adopted.

Once you can determine the who, you can design your messaging, content, and marketing around your buyers.

Phase 4: Scaling (gas to the fire)

This is the fun part you’ve been waiting for.

But Martina has some cautionary advice for startups excited to get to phase 4. (Read on below!)

Be wary of rushing to phase 4 too quickly

If there’s a mistake a newer company is likely to make, it’s rushing to phase 4 too quickly.

Often, a company will have some success by getting to $1MM rather quickly, perhaps from some very excited early adopters, who are maybe even colleagues from your field. Startups will often take this as the signal they’ve done everything correctly. But Martina says that, often, it’s not hard to get to $1MM. It’s the next $1MM  to $2MM that’s difficult to reach.

So don’t misread a few early adopters as a signal you’ve completed phases 2 and 3.

Scale when you have demand + a repeatable sales process

The 2 things that could make or break phase 4:

  1. You need to determine true market-wide demand, making sure not to base demand on a few excited early adopters
  2. Have a repeatable sales process

Pro tip: The real litmus test of whether you can scale:

Do you have a sales process you can hand over to an average sales rep — not just a rockstar rep — that will consistently deliver conversion from one stage to the next?

The most successful company isn’t always the most disruptive

It would be easy to assume that the most successful companies are the most disruptive. But Martina said that’s not always the case

“I would say the single most important thing right now is to have an intersection between thoughtful ways of disrupting an industry — which is not necessarily the most disruptive technology — then to really go to market in a differentiated way.”

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It’s not about being the most disruptive, it’s about understanding an industry, what its needs are, and then finding clever ways to apply technology.

Martina Lauchengco – Operating Partner at Costanoa Ventures

For example, one tech company in Costanoa’s portfolio was looking to break into the construction industry. To do so, they actually “downgraded” a piece of technology from drones to a simple snap-on GPS tech, which was applied to vehicles for tracking purposes.

This product (and company) was very successful because they considered their particular market — construction. Construction has traditionally lagged in technology evolution, so the important thing wasn’t massive disruption, it was ease of adoption and implementation. 

On the flip side, a company in aqua farming has totally disrupted the normal way fisheries track data. Traditionally, a sample of 10 from a pen of up to 2,000 fish is caught in a net and surveyed, and the data extrapolated from the 10-fish sample.

But with the new aquafarming technology, data from all 2,000 fish can be captured using high-tech cameras. This is a completely disruptive product, but it’s finding tremendous success because it aligns with the goals of its market base.

This is an interview with Martina Lauchengco, an operating partner at Costanoa Ventures.

To hear this interview, and many more like it, you can subscribe to The B2B Revenue Acceleration Podcast on Apple Podcasts, on Spotify, or on our website.

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About Operatix

Operatix is a Sales Acceleration company specialized in supporting B2B Software vendors to identify new revenue streams, increase qualified sales pipeline, and accelerate channel development across Europe and North America. Operatix has a wealth of experience in working with the biggest tech players worldwide as well as a multitude of emerging software vendors.

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At Operatix we will support your 1:1, 1:few or 1:many approach to get your team in front of decision makers in the accounts that matter the most to you. 

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Generating Pipeline for our clients is our key-objective. And we do that by using a multi-touch, multi-channel approach to generate qualified sales engagements for our customers’ sales teams.   

Account Intelligence / Deep Dive

Understanding buying centres, hierarchies and relevant personas in strategic accounts is a fundamental step to increase conversion rates. By leveraging account intelligence in a sales conversation your team can tailor their message and provide value to their prospective customer. But sales & marketing teams often struggle to dedicate time and resources to do the deep research and this is where Operatix can help.

DMID – Decision Maker Identification

Finding quality data is an on-going challenge for B2B Tech vendors. The accuracy of data platforms is questionable and that is why Operatix developed a manual process to identify & verify contact details for decision makers within strategic target accounts.

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Operatix can develop Sales Playbooks that enable teams to sell more effectively. Your Playbook will be fundamental to implementing the correct messaging, accurately position your solution against competitors, and adapting the communication of your value proposition to different buyer personas.

Lead Qualification

If your leads aren’t converting, it might be a lead qualification issue. Operatix can help filter through leads that need further qualification, ensuring that they’re ready for an AE or sales team member to engage with and progress through the funnel. 

Partner Portal / Marketing Concierge Service

Vendors often spend thousands of dollars building multifunctional Partner Portals to help channel partners educate their teams, manage opportunities, and create marketing programs. Still, these portals are often underutilized due to lack of bandwidth and capacity from vendors to offer support in enabling their partner community. Operatix, through their Partner Development team, can support your partners to make the best use out of your partner portal, managing the relationship with your partners and helping them set up co-marketing campaigns to drive more revenue for both businesses. 

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Optimization of MDF

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Solution Selling Training

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Predictable Pipeline Generation

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Revenue Acceleration

Operatix helps your business get to revenue quicker. By providing qualified sales engagements for your direct sales team (to kick-off new sales cycles), or by accelerating the growth of your channel partners, our focus remains on delivering tangible results for your business. 

Persona-based Selling

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