Archives for: May 2007

05/05/07

04:15:52 pm, Categories: Entrepreneurship, SalesQB Diary  

The Idea

After licking our wounds from the small business CRM battlefield, we decided to position OppCoach as a stand-alone product that could plug-in to any CRM system. The natural ally, with this approach, seemed to be Sales Training companies. So, we started figuring out how to make a dent in the sales training market.

The Funding

Funding at this point was still coming from our consulting operations. The thought process was that if we could get a few customers to sign-up, our valuation would grow exponentially and we would have to give up less of our equity when we did a Series-A round

The Pedal to the Metal

Early in 2005, we developed the second version of our product. A stand-alone sales coaching product that provided opportunity-specific sales coaching and industry / domain knowledge. We retained the name OppCoach and even integrated it with SalesForce.com. We identified a conference hosted by the Professional Society for Sales & Marketing Training and got ourselves a booth there. We headed to the conference in Amelia Island, Florida, and started networking.

We met with numerous, leading sales training companies (Porter & Henry, Forum, Trainque etc). Each of them was thoroughly impressed with what we had to show. The CEO of Porter & Henry went to the extent of saying that OppCoach provides the coaching & mentoring to reps that sales managers ought to but don’t.

Then came the rub. I talked to the CEO of Porter & Henry and asked if he would be interested in partnering with us. He didn’t mince his words. He said that partnering with us wouldn’t make sense for his firm, because we would be going after the same customer dollars, and thus cannibalizing each other’s sales opportunities. I tried to come up with revenue sharing models and synergies, but the ice didn’t break. It didn’t help that the sales training market is incredibly fragmented, moves at a glacial pace and doesn’t really appreciate “software” solutions.

In the second half of 2005, we fine-tuned our positioning a bit, and started directly targeting sales training groups in Fortune 1000 companies. We were having very good conversations with brand name companies (Pfizer, P&G, Canon etc) and making good progress. Most customers we talked to would leave the meeting excited about the prospects and potential opportunities. By the end of 2005, we hadn’t closed any deals. Obviously, sales cycles for new solutions in Fortune 1000 companies weren’t going to be quick. So, we hunkered down and waited with bated breath for 2006.

The Lessons

Selling solutions is very different compared to selling services. Completely different value propositions, sales cycles and capital requirements. Our management team had a good bit of experience selling services, but selling solutions took a good bit of getting used to.
In retrospect, even though we had a good bit of traction with sales training groups in Fortune 1000 companies, I realize now that we weren’t targeting the right decision makers. Sales training groups typically “don’t do software”. The decision-makers we should have been targeting are those who also bought CRM / SFA systems, namely Sales VPs who are in charge of overall sales operations. Goes to show that just zeroing in on a target market isn’t sufficient. You need to go down to the target decision-makers and present compelling value propositions. We were learning hard-earned lessons, albeit at the end of a very sharp stick …

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