It is far from easy to start tech company. Survival of tech companies in business involves and demands much in this highly competitive world of business. In order for you to attract the appropriate clientele, there is a very acute need of ensuring that the services that you offer are quality. There very many marketing strategies that have been used over the years by tech entrepreneurs to attract customers to their investment. Radio, newspapers, television, and among others are some of the strategies used by such tech entrepreneurs.
Starting tech companies takes longer than anticipated. It also costs more to start tech companies than expected. Panning out for venture capital investments is scarcely achieved by 80% of all venture capital investments. The Sales Learning Curve is required by tech entrepreneurs to make it in the industry.
The role of the Sales Learning Curve it to effectively track margin contributions per Sales Yield gauged against the all customer transactions. The curve shape is different for different tech companies. To enter the market, tech companies need to go slow. Many people are aware of this strategy in their different industries. The Sales Learning Curve operates under this confine.
There is an organizational learning that takes place when sales reps meet face to face with customers and close initial sales.This is a very crucial requirement for the success of the organization.Going to the market as a requires hiring a VP of sales after completion of the beta product after which hiring many reps to “drive revenue and get to breakeven” is done. This strategy fails most of the time. This failure is guaranteed by lack of investing time in understanding the SLC shape for its product in the market.
Everyone will see a consistent pattern of highly inflated B round valuations in the tech startup entrepreneurship industry. A worthwhile note is that the down rounds for C percentage and later rounds is greater than B rounds. Entrepreneurs and VC’s lightly consider the cost and time needed for moving up the SLC after completing the Beta product as evidenced by this fact. They fail to understand that company is now ready to commence the SLC learning process but not likely to immediately gain market traction forthwith. The time that this process will take is not consistent and easily determined. This process may take longer for some tech companies than for others.
Important to note is the fact that as you move from beta release to first release, few technically savvy sales reps need to be hired. This will be conduits between initial customers and the tech team compensated on the organizational learnings.