Business Development for Startups
You now have the barebones of a business. Everything you need to succeed is in place. But in many ways, the hard work starts here.
Business development and sales is the acid test of your work to date. To generate revenue and ultimately make a profit, all your work must align to guide prospects seamlessly through the sales funnel. Your website might be beautifully designed, but is it visible online? How are sales prospects going to find you? Or are you going to find them? Is your pricing right? What about your brand? All the answers will become clear as you build new business and drive those all-important sales.
More about the sales funnel
The sales funnel is the process of turning leads into prospects, and prospects into customers. Such a simple explanation makes it sound like a walk in the park, but a lot of fine-tuning is required to formalise this process to produce a consistent stream of sales leads.
At the top of the funnel, where it’s widest, you have a mass of unqualified prospects. As these prospects progress through the funnel, the leads become more refined and reduce in number. After an initial discussion for example, the number of prospects might drop by half. When you reach the stage of offering or presenting a solution, the number may have quartered. By the time you reach a sale, only a very small percentage of those initial unqualified prospects will remain.
The art of a successful sales funnel is to refine the sales process to such an extent that you maximise the number of unqualified prospects that become a sale. As such, your sales funnel should underpin your entire business development and sales function. Here’s a great article on sales funnels for further reading.
The difference between the sales and business development function
Generally speaking, a business development specialist is responsible for identifying and creating partnerships that can be used to drive revenue, enhance your brand and improve channels of distribution. The sales function focuses solely on driving revenue. The good news is, as a startup, both of these roles are yours. So, prepare for plenty of early mornings, late nights and lots of hard work!
Traditional business development techniques still hold sway
In this day and age, you might assume that traditional business-building methods are losing ground to sophisticated online marketing techniques like search engine optimisation (SEO) and pay-per-click advertising (PPC). And to a certain extent, you’d be right.
However, particularly in the professional services industries, old-school business development methods such as networking events, professional introductions and referrals are still worth their weight in gold.
Very few startups can rely on online marketing to generate business in the short term. SEO is a long-term process that can take months or years to build up steam. With so many competitors trying to achieve visibility online (i.e. page one on the search engine results pages) the costs of a long term campaign can be high, and even when you do achieve visibility, you probably won’t receive the stream of enquiries and leads you might like.
Combine the old and the new
While the majority of startups would not consider business development methods such as cold calling or telephone marketing, there is a place for email marketing campaigns, as long as the message is carefully crafted and sent selectively.
There is also plenty of value in using social media channels such as LinkedIn for business development. It’s a free resource, which is fantastic for startups, and it also allows you to create a company page, as well as a personal profile, which can be found for relevant searches in your industry.
Then there are the more traditional forms of business development. Sign yourself up for networking events, attend industry conferences and talk to as many business people in your local area as you can. And, perhaps most importantly, concentrate on client retention. The more clients you retain, the less time you’ll have to devote to business development, allowing you to dedicate more of your time to driving your business forward.
Create an investable startup
The more business development success you experience, the more investable your business will become. Venture capitalists will hold a proven business development strategy with high regard, inspiring plenty of confidence that your growing startup has a steady and reliable flow of customers.
What methods of business development have been most successful for your startup? Are there any techniques you would advise against? We’d love to hear from you, so please leave your thoughts in the comments section below.