cyberlaxamana

by Private It is now fashionable to start consumer facing companies that promise to radically change behavior and create new markets. The companies that have done this well have become legends and inspired a generation of entrepreneurs. That is a good thing. Indeed, on an absolute basis that may be where the majority of the profits accrue over the next 10 years. However, those profits are vacuumed up by a small number of very large companies. My belief is that the highest number of profitable tech companies will be those that address waste in the b2b space. That is, if you want to increase the likelihood of launching a successful tech venture, understand where the largest areas of waste are for businesses in a given industry and then build a solution that minimizes or eliminates that. I’ve chosen to focus on serving other businesses (as opposed to consumers) for the familiar reason that they can be sold based on a P&L. That is, if my product saves you $10 without diminishing your...

by Katharine Nevins Using customer development methods for enterprise products seems hard, but Dropbox is making it work Lean startup wisdom says that a startup should get product in front of customers early and often in the process of customer development.  Feedback from real customers voting with their clicks and their dollars is the cheapest and most reliable user data you can get to improve the product, marketing, etc.  Customer development as we’ve been learning it, however, seems like it would be challenging to do when creating an enterprise product. Unlike consumers, who are can be found cheaply through Twitter, Facebook, and Google Adwords, enterprise software buyers are relatively few and tough to access as cheaply.  Assuming that the startups can find enterprise decision-makers through their personal networks, LinkedIn, etc, getting real feedback from them might still be difficult.  My understanding (based on having worked on small business accounting packa...

by Oliver Jay Why can’t they launch as early?  Early vs. Late Adopters.   Eric Ries commented that “early adopters are so small that there is minimal reputation risk” for startups to launch early and learn as soon as a MVP is built.  I’m not sure if this applies to B2B companies.  In many B2B markets, the number of potential customers is generally far fewer and companies are often challenged with customer concentration.  For Rentjuice, launching early targeting a few Boston realtors can be a risky endeavor.  Rentjuice does not have the luxury of consumer-based companies like Triangulate, for example, which can keep pivoting by appealing to different sets of early adopters until it reaches PMF.  A half-baked B2B product shown to a few “early adopter realtors” runs the risk of 1.) losing that potential customer forever as it would be much more difficult to get in the door again, or 2.) irreversible reputational loss in Boston if the customer landsca...

by Paul Lenehan The lean movement is characterized by fast, hypothesis-driven, data-driven iteration, capital efficiency, and proving the concept before building scale. The success stories for this model are typically B2C startups like IMVU and Dropbox. Meanwhile, B2B startups like Rentjuice appearing to make fewer pivots than their B2C peers and in many cases require large amounts of capital. Why is this the case and can they still be considered lean?  Fewer, More Powerful Customers: Dropbox and IMVU built their business with thousands of individual users, while B2B startups like Aquion and Rentjuice launch with a much small number of key customers. For example, if Aquion focuses on the utility market for batteries, they may only have capacity to serve one customer in their first several years of operation. While this is the most dramatic example, B2B startups often have a limited ability to conduct statistically significant A/B tests on the user base. More importantly, fewer cu...

by Amit Jain “What I love about the marketplace is that we do our products, we tell people about them, and if they like them, we get to come to work tomorrow. It’s not like that in enterprise . . . the people who make those decisions are sometimes confused.”  -- Steve Jobs  As usual, Steve’s on to something -- enterprises generally are not as quick to adopt disruptive technologies, largely because it is more complicated for a person to make a decision (and consequently be held responsible) for a change that impacts multiple persons rather than to make a decision that impacts just one.  So how should startups approach the enterprise space? Does it make sense for startups to use lean startup principles that have been successful with many B2C companies?  Lean startup principles that work in enterprise:   Agile Product Development: Gone are the days where the sales team of enterprises dictate the product roadmap.  Lots of enterprise startups are gaining t...