Grow fast or dieSurface Transport & Logistics
Leon was a thirty-something Silicon Valley executive when he started his software company. Sales grew to over five million dollars in the third year as the company showed four quarters of increasing profit.
Investors started contacting Leon and he told them, “Sales and profit are growing nicely without new capital, thank you.” One investor, Richard, noted that his funding would make the business financially secure and having more money in the bank would give Leon greater freedom in managing business. Leon and Richard got along well together and they soon closed a deal. Sales continued to climb organically through word of mouth and everyone was happy for two years. Then, one day Richard called Leon to say, “grow fast or die.” Leon was shaken and he regretted the day he made a deal with Richard.
When Leon’s shock and anger cooled off, he made these points to Richard the investor:
- The days of growth at any cost are behind us in the software industry
- Today, growth must be sustained and balanced with profitability
- The company sales and profit are growing
- Richard, you just want to make a lot of money fast, even if that drives my businesses to fail
- I want to build a sustainable business with balanced growth and profitability
The Richard listened patiently to Leon and responded with these points:
- Scale matters a lot in the software industry
- The largest software services dominate smaller competitors
- Your past performance was fine then, but it’s not good enough now
- Today, faster-growing competitors threat the survival of the company
- Leon, you need to adopt a high growth strategy, to scale-up fast and survive
After some passionate discussion, Leon accepted the fact that Richard was right. The company had to scale up fast and organic word of mouth growth wasn’t enough anymore. Richard made it clear that he wanted to see new plans for accelerated growth before he would invest more money. And the new plans had to be backed up by real signs of faster growth.
Leon couldn’t jump-start sales with his current staff and he didn’t have time or budget to hire new people. So, Leon spoke with Guided Leads.
We worked with Leon to understand his needs and the market opportunity to accelerate sales. We designed a three-month presales plan that had four presales components:
- Generate a stream of qualified leads from the company’s current target clients at memedium-size companies that were not currently using a competing service. Guided Leads identified ten thousand companies similar to Leon’s current customers. We managed a campaign to contact prospects through email, phone calls and LinkedIn.
- Nurture the company’s current client base to encourage more word of mouth referrals. We published a weekly newsletter to keep the client informed about best practices and new developments.
- Inform customers of competing services about the advantages of using the services of Leon’s company. Guided Leads identified over one thousand companies using a competing services and we send them a series of case studies comparing the services.
- Create awareness and interest with buyers at major corporations, that used in-house captive services. Guided Leads made a short “hit list” of large companies that could use Leon’s company services. We contact them one-by-one through email and phone conversations to introduce Leon and his company services.
The results supported Leon’s plans for accelerated growth and helped win new funding from the investor:
- Leon hired a part-time in-house sales rep to handle inquiries from medium-size companies that did not come from current client referrals
- Nurturing current clients had the unexpected result of producing requests for new company services
- It is not clear if nurturing clients created more word of mouth referrals
- Only a few clients converted to Leon’s company service from a competing service
- Leon developed convincing case studies about clients that converted from competing services and we incorporated the case studies into our presales campaigns
- Two major corporations contacted Leon
At first, Leon was angry at his investor for saying “grow fast or die.” Now Leon is always hungry for accelerated growth. “The alternative to fast growth is a slow painful death,” says Leon about his industry.