Great! You Raised Money. Now what?
Shorten your time-to-revenue and reduce your cash burn by thinking about your prospect data sooner.
Congratulations! You’ve just raised a round of funding be it Angel, Series A, Series B or other method. It’s time to pat yourself on the back. Your hard work and vision are starting to yield results. Someone out there believes in your company and vision enough to risk money investing in your venture!
Now you have the funds, what’s next? Here’s a quick list of steps that you need to do to get your baby off the ground:
Finalize your Minimum Sellable Product (MSP) and prepare to go to market
Staff up a team for your launch including:
Customer Success & Support
Finance & Operations
Hold it! - You may be about to make your first critical error!
We hate to say it, but you may be about to make your first big error. After hiring your business development and sales team, you need to ask yourself do they have the data they need to succeed?
Consider this: As you ramp up operations using the recently raised funds, the cash burn clock is now started. Investors will be expecting regular reports of progress in terms of:
Most startups and early stage growth companies follow a well-trodden playbook for gearing up for sales and business development.
They may try to run sales through the founders using their informal networks
They may hire a marketing person and use social and email selling to build top of funnel pipeline
They may hire a sales leader, probably someone they know, to establish the sales function
The sales leader will start to build a sales team from his/her network
This is all good but closing the gap between raising money and bringing in early revenue are the terms the founders should be thinking in. Think about the sales leader’s to-do list for the first few quarters:
They need to get up to speed on the product or service
They need to identify and understand the Total Addressable Market (TAM)
They need to identify the Ideal Client Personas (ICP) to target
They need to identify the most viable sales channels (Direct, Reseller, OEM)
They need to start building a sales team
They need to get the sales team needs up to speed on the product or service
They need demoware, sales collateral, sales tools
They need marketing support for demand gen, social media content, email nurturing etc.
They need to build a prospect list based on your target personas
They need to start prospecting that list using a variety of methods
Regardless of what combination of techniques you choose for prospecting, it is item #9 that could derail the whole plan.
The sales leader will probably adopt one of more of the following techniques:
Email blast/nurture campaigns
Telephone prospecting with SDR’s and AE’s
Use demand generation vendors for cost per lead (CPL) campaigns
Social media outreach
Adwords and paid search
But before all of this happens, sales leaders need to be aware of the one thing that could derail the effectiveness of any one of these approaches: the quality of the prospect and contact data. whether that means data fed into the start of the prospecting process or data that is gathered at the end of the process in the form of lead & prospect data.
If the data at either end of the prospecting process is incomplete or poor quality, then it’s going to cost you time and productivity and time is no friend of cash burn.
How can you fix this? You have to shorten the time between target identification, demand marketing and field sales prospecting. One way of doing this is to invest in good prospecting data early on. Time saved building accurate and fresh prospect data is more time available for actual sales and marketing activities that generate opportunities and top-of-funnel pipeline.
Done properly this will shorten the time to revenue generation and every dollar of revenue generated will start to reduce your cash burn. If not, you may end up flushing a lot of money down the toilet and not even realize it until it’s too late.
Take the time to identify your TAM and ICP before you buy data and engage vendors
Don’t take data vendor quality as a given, ask for samples and test them
Don’t commit to long term subscriptions with data service vendors until you are sure they can produce effective and consistent data
If you are using a demand generation (CPL) vendor consider investing in and budgeting for data quality services that can take the CPL lead and enrich that lead with extra valuable data. It’s madness to pay $25-$75 for an incomplete CPL lead but not pay $2 more to make sure the lead or contact is fully validated and complete. Yet hundreds of companies do exactly that leaving millions of lost dollars on the table
If you use a Content Syndication vendor, don’t commit to more than 50 leads per batch and evaluate each batch before signing up for a new one. Content Syndication vendors can be the worst offenders for lead data quality drop-off
Picking tools and data vendors without sufficient due diligence will make the old adage come true: Marry in haste and repent at leisure!
Contact Persona offers 3 services that help to reduce the risk and improve the end product of many of these business development methods:
CustomPERSONA is a bespoke, high quality contact curation service that treats each and every list build as a new project, not as a stale database extract of old contacts like most other vendors
ContactPERSONA is a near real-time lead processing service that takes raw leads from marketing and CRM systems, validates, enriches the lead with more and better-quality data and delivers the enhanced lead back to the source system before the Sales team ends up wasting time trying to clean the lead themselves.
ContactPERSONA ON-Demand takes batches of lists from trade shows, old client lists and field events and scrubs, validates and enhances them in one batch.