we are

wrapping up our workshop season uh

tonight uh with uh michael scott's uh

startup secrets series i can't say that

um he has been a phenomenal contributor

to the ilab so i do need to take a

moment to thank michael for all for all

his hard work and everything he's

contributed to the ilab his workshops um

as you know if you've been to any of

them are incredibly amazing and uh

they're so content rich and it's um

hitting upon all of the important

components of starting a company so

incredible resource that we have so

thank you michael um

and so i'm just going to quickly turn it

over to him so he can get through all of

this amazing content

if uh you are here for the first time

michael scott serial entrepreneur very

successful turned venture capitalist um

has a tremendous uh amount of knowledge

in this space and uh is uh incredibly

wise when it comes to what it takes to

start a company so i will turn it over

to michael scock

i always feel like after jody's

introduced me it's all going to be

downhill from there it's uh it's hard to

live up to that kind of introduction but

hopefully we're going to have a lot of

fun this evening and i do feel like

this is going to be the most fun of the

sessions because we've got such great

guests but also because it's a wrap up

in many ways and a lot of the elements

that we've talked about in the other

pieces of the startup series are going

to come together tonight

now that doesn't mean to say that for

those of you who weren't here for those

other sessions you're going to be left

out and i'm going to explain how you can

get access to all that content too

thanks to the ilab and the great work

that they're providing here

but first of all very importantly i want

to welcome our guests

so one of them is at least planned to be

late but the other three are here so we

are lucky enough to have an alphabetical

order from a period mark laurian

and he was previously

svp over at uh spot fire and and working

as part of the tibco group so mark if

you just want to raise a hand and say hi

so who knows who you are

uh welcome uh we have from demandware uh

james driscoll who's our head of

marketing there and jameis will be uh no

no uh

uh surprise to some of you who've seen

his great work at the eye lab before

and then our guest tonight from

um hubspot our ceo brian halligan brian

if you just want to raise a hand so who

knows who you are too

welcome

so delighted to have you here um a bit

of fun later on my brother actually

hopefully will show up when he gets

through traffic is going to cover one of

his favorite subjects

which is part of the building a sales

and marketing machine so i think you'll

really enjoy that too so between us what

we're going to try to do is to bring to

life a framework around

what the various different elements are

of building a go to market strategy but

it's a huge subject and so

i just want to make sure that you know

all of this content is available in much

more detail on the website

and i've had a lot of questions over the

last few weeks from many of you have

attended the previous workshops about

how do you find what content when's it

updated and all of that so i'm going to

take you through a quick tour of that

and by the way lest i forget it for

those of you want to tweet about our

guests all their twitter handles are

there and the usual ilab stuff's always

up the top so you can get at that stuff

okay so quick tour on the website itself

um and forgive me while we take a moment

on this

you basically if you go to the site

you can find absolutely anything by

going to the top menus and under startup

secrets is every single one of the labs

so for example if you went to the go to

market section you will find a write-up

which i've actually printed out for you

tonight to make it nice and easy

but at the top of that right up is the

url if you want to go to it online and

the idea here is that there's way more

content being built now that we can

actually capture in one session so for

example for those of you who were here

last year

for the series we had a number of other

great guests who covered things such as

brand

channel and distribution we also talked

about some of the key areas such as for

example how this relates to your

business model and so forth all of that

is available as resources on that page

and i'm not going to cover those tonight

we're going to instead get into fresh

material from our current guest stars

and so you'll find that detail here and

i'll refer to it where i can but the

idea is that we'll get more and more

content up there for those of you who

want to keep checking uh we'll put a

sign up form because i've had that

request from people so you can get uh

notified when there is new content

so thanks for all the interest i really

appreciate there's been a lot of

fantastic comments back we'll try to

respond to them all on the site

and keep the content coming and thanks

to our guests for contributing more this

evening

okay let's jump in

so always um as you've probably heard me

say the goal of these startup secret

series is to provide you a framework so

that's not the answers and nor is it the

detail of everything that you might do

to build a go-to-market strategy

in fact as you probably have heard me

say if you've been here before what i

really tried to do with this series was

to think about what would it have been

like if 30 years ago as an entrepreneur

i could have got some mentorship from

somebody who could fast forward me

through all the mistakes i made and

believe me there were plenty of those

there's plenty of scar tissue to prove

that

but instead could actually share with me

some frameworks to think about the

things that might be worth you know

challenging myself to plan ahead of time

to deal with as a startup and so in the

go to market uh space it's a pretty big

framework it turns out this is a pretty

big part of the execution for most

startups

now i'll say ahead of time that this is

a framework that's mostly based around

my own experience of b2b and mostly in

software but as most of you have fed

back to me there are a number of you for

example who want to do not-for-profit uh

and ngo-type things and and have

interest in a broader sense so we've got

case studies on that uh for example

diagnostics for all who was here for one

of the workshops that case study is up

on the site now uh we also had if you

remember one laptop the child for those

of you here that case study is going up

shortly and i'll continue to build the

not-for-profit and other case studies

and i want to thank people like aloe can

encourage others of you who are in the

audience who want to contribute to those

case studies to come share them with me

we'll put them into the framework and

we'll try to bring this to life for

those of you doing this in a

not-for-profit way

but what i will tell you is a very

simple thing in this framework there's

basically a cycle that people go through

of figuring out how to find you from

awareness all the way through how to

purchase you and that's what's on the

left-hand side

and there are basic tools associated

with that the old world used to be all

about um outbound marketing and we're

really excited to have brian halligan

whose firm hubspot was one of the

pioneers in the whole science of inbound

marketing which didn't even exist when i

was you know embarrassed to admit my age

here you know back 31 years ago starting

my companies but that's the point about

this this is a living breathing thing

and there's no answer here it's just

some things to think about so we're

going to talk tonight consistently about

you know what's the way to to optimize

as a startup the inbound versus outbound

uh and again we're lucky enough to have

mark lauren here who's going to actually

post what we actually have posted

already his case study on outbound

because there isn't time to go through

it all tonight but what we said was

there's a bare minimum of things we

wanted you to think about and these are

they

first of all you really need to think

about what your brand is and what you

represent so we're going to cover that

secondly you've got to figure out you

know what channel do you want to take

that through and again that's almost

invariably figuring out where you're

going to focus on target segments of the

marketplace that you can be successful

in and then i'm going to cover a couple

of startup secrets that i learned the

hard way around personas and really

getting very clear about who you're

dealing with at what stage in the cell

cycle

and then the bottom line which is really

quite fun gets a lot of focus this

evening intentionally which is it's all

very well to be executing on your

marketing program but the hardest part

about marketing is often measuring it

it's actually figuring out what's

effective and the many famous quotes

about this

but i'll just get to the bottom line

here there is no substitute for

measuring and iterating on your

marketing program so we'll talk a little

bit about how you do that and how you

might measure it and what are some of

the ways that you can make this

effective for you

so that's our framework for tonight and

uh it breaks down into the following

agenda i'm going to start with some

strategic things like the brand and

positioning

and then we're going to get into some

tactical things like how to run that

marketing and sales cycle and then we're

lucky enough to have as i said a couple

of guests to talk through some of the

execution of this

all right

jumping right in then we talked about

this in the first workshop

your brand is one of the most important

things that you can define very early on

in a startup but the question is why

and for many for many people it's as

obvious as well your brand is obviously

what you want people to recognize you

for well if you're coke that's very easy

but if you're a startup and you're joe

blow enterprises then you know it's not

that easy and in fact presenting a

business card as a startup is the first

challenge you have is that you don't

have credibility until you build that

brand so how can you get effective

and what i'm going to suggest here is

that this is really a science unto

itself

this is in fact something that you

really have to think hard about in the

same way that you think about are you a

diet coke or are you a diet pepsi lover

do you buy apple or you buy dell and

what do you want to represent do you

want to represent yourself as the

premium brand with high margins or do

you want to represent yourself as the

you know high volume low margin brand

and there are many different things that

fall out of that

like i said this is a big subject so

this is one of the pieces of content

that we're not going to go into in depth

tonight this is on the website

we covered it in depth last time so

you'll find a full explanation of this

you also find us talking about some of

the fun brands in the consumer world

like nike uh some of the ones in the

tech world like zipcar so that's all

online and it's uh you can go to it from

that handout i gave you the things i

want to point out tonight uh that are

easy for us to just think about and

we'll tee up our first guest which is

jameis from demandware is that almost

all of us have heard of the idea of a

vision and for those of you who are here

for that company formation session we

talk about it in depth well brand does

start with your vision although the

slightly different thing in the brand

world is it's really about what are you

changing in the world what is it that

you're trying to make an impact with a

little bit different than how you're

building your company although the two

of course are very closely aligned and

then the second key part is the promise

what do we promise to customers at the

most fundamental level so what is if you

think about thinking about this

something that we've covered that that

might add to this

value proposition and we cover the value

proposition in that whole workshop so

the value proposition relates very

closely to promise and then the piece

that gets very interesting and exciting

that jameis is going to bring to life is

the attributes of your brand what

actually makes this a brand that people

can get behind

and ultimately that's expressed in

emotion personality and style

so i've glass glass uh sorry glossed

over that quite quickly intentionally

because we're gonna bring it to life as

i said with um you know what jameis said

but i do want to bring out one key thing

that i hope will help every one of you

as a startup there's a starting point

that's really really simple

it's about you

that is to say you the founders are

going to be the brand whether you like

it or not by the way

so get ready for that i mean people will

identify the startup of you as

what you bring to the the uh the

marketplace especially when you don't

have a product initially and you're

going out effectively to pitch yourself

so think about how you the founders your

team and your culture and some of the

things that we talked about in for the

company formation session can be

embodied in your brand because it's

actually one of the most truly realistic

and authentic parts of what becomes a

startup's brand and so thinking about

that early will help you formulate what

it is that people will take away from

you

and then how you execute

is actually what people will measure you

on you know you can claim all the things

you want in the world but if you don't

deliver on high value for example

nobody's going to attribute that

to your brand likewise if you don't

deliver on great customer service and

you're trying to make that as a promise

that's not going to be consistent and

we'll talk about how that important that

is

so to bring this to life i happen to be

in the boardroom

of a public company of mine demandware

and so i'm going to tell you right now

because it's public we can't disclose

all of this information on the site

and we had a real live case study sure

enough uh we were at the demand web

board meeting and we were talking about

a company that's now you know an eight

year overnight success having gone

public this year could evolve its prime

its brand what could we do to move the

needle now that we've become a

substantive company uh with market

leadership position to really accelerate

the next stage of our brand so with that

i'd like to introduce jameis to uh bring

it to life and tell us how did he do it

thank you michael can everyone hear me

okay

it's a chronic fear as a marketer that

you're not heard so it's the kind of

thing that i like to check whenever i

start talking

so thank you for the intro i'm here to

talk about a living case study so this

is ongoing right now

and what i want to do is take you

through some of the rationale that we

had about our branding and take you

through some of the you know analysis

that we did and then ultimately show you

a couple of instances about how we're

starting to execute it um and the

execution is not yet live so you guys

are getting a sneak peek at a lot of

this

let's bounce this along one more good so

um as michael said earlier early stage

when you're a smaller organization it's

very easy to sort of deal with branding

particularly when you're in a marketing

organization of just a couple of people

because you are the brand and you can

make these brand choices along the way

and you just sort of know instinctively

whether something's what you want to

represent or not

but as you grow as an organization and

as in in our case we got a much larger

platform now with a much larger

microphone it was time for us to look

back and really

institutionalize the brand you know what

are the brand attributes of us that we

wanted to build equity around as we

execute in lots of different markets

and so what we did is we looked back at

and did an analysis with our customers

and the broader market to get a sense

for what are the attributes that we're

known for and also what are the

challenges that we have in the

marketplace and what are the things that

we're trying to get done

and i'd summarize it simply by saying

that we're here to try and change the

criteria in the buying cycle so

demandware in this case as an e-commerce

platform company was selling into a

market where there was already sort of a

software space

but we were doing this in a very

different way which was to deliver this

as an on-demand service so our goal in

our marketing and in our branding is to

help the market change its mind and

change its perspective about how it

evaluates us and thinks about us so this

is overall for us about how do we build

on what we've done and change the change

the criteria

you know for us it was about and i'm not

going to go through each one of these

things but a sense of both moving from

how we had marketed in the past and also

how buyers thought about it

to this new set of things that we wanted

them to consider you know from cost to

advantage

from managing software to growing the

business

for mid-sized companies to really the

sense of high-growth brands

and so our challenge was how do we then

sort of move from the left-hand side all

the way over to the right and get people

to think about things differently

when we did an analysis of the market

what we saw

was that

everybody for the most part was playing

in the blue boxes

where everyone was talking about either

e-commerce or technology and talking

about it as either features or benefits

and occasionally we'd see people that

were moving to the upper right and the

upper the lower right and the upper left

but what there is was this great

opportunity in the green squares where

there was this intersection of what are

the rewards that individual buyers want

you know what are their aspirations what

are their goals and how do those align

with the big objectives of these large

retail organizations which is really

around the brand and their marketing so

what's that intersection between the

reward for the individual

and the broader objectives of the

business and that's where we saw and

think there's a

tremendous opportunity to brand the

company differently

so i'll explain that a little bit more

what this meant for us

was we needed to move around and move

beyond some of the broad claims that we

were making the marketplace and really

substantiate them not just moving the

claims of our software but also talk

about what it was going to do for

individuals personally

we think one of the great opportunities

in enterprise software now is to start

talking about the emotional side of

software right what does software allow

someone to do

to fulfill their own dreams their own

ambitions their own goals

we think about this in consumer

technology all the time apple of course

is the case study for this where we use

iphones because they're cool well

couldn't enterprise software be cool you

know we're spending a lot of times as

buyers here and this is we're making

strategic bets here couldn't we

make enterprise software something that

individual buyers would aspire to and

want

and the ultimate success of that would

be if they were in the cocktail party or

talking to their peers and they were

saying you know

i'm using demandware right and that was

that sign of sort of personal expression

so to get to that level of sort of

emotional connection to buyers we wanted

to position the company around a lot of

their ambitions and goals and dreams to

sort of get to that word of mouth and

sense of pride

that people have when they're really

connected to a product

so one of the things that we looked at

was when it comes to positioning

branding it's not just about you know

how the customer feels about you but

how does the product or how does the

brand make them feel about themselves

and so in the case you see here here's a

you know a kitten looking in a mirror

and seeing a lion

we want the buyers to sort of have that

sense of you know what they think about

themselves is reflected back uh based on

the selections that they make right so

that's what we're trying to get to

and michael talked earlier about the

actors we look at as sort of somewhat

who are the actors that we see in the

buying cycle

from the head of e-commerce to the ceo

or cmo to i.t or finance

you know and what are their sort of

rational reasons for buying um you know

there's a long-standing axiom in

in marketing which is people buy

on emotion but justify with fact

so these are generally the facts that

people think about when they justify a

purchase

whether it's finance wants better

economics or the ceo is talking about

the growth of the business but what

they're really thinking about are sort

of the emotional quotient behind that

what are the things that they really

sort of want to feel about themselves

whether it's i.t wants to feel like they

have a much

stronger seat at the table or the

ecommerce person wants to build their

career to be able to move up to the ceo

level or ceo really wants to be you know

thought of as a leader to watch

our goal in the branding is to sort of

attach ourselves to those aspirations

that they have

so that when they think about their

career growth they attach that to our

brand

okay

so our brand promise the you know the

pillar in which we're really building

comes down to this concept of potential

right

that

we as a company and a provider are are

the means that they're going to use to

achieve whatever their dreams are right

their potential as individuals their

potential as brand

we want them to think about us as the

canvas in which they're going to write

them or paint that masterpiece

so that's largely what's behind our

brand strategy is to attach ourselves to

their dreams

so the customer benefits from this in a

couple different ways you know when

e-commerce traditionally has been you

know thought of with very big software

infrastructure and laborious processes

what we're coming to is a sense of look

if you if you can think it you can do it

if you have an idea you can put it into

action

right no matter there's no limits

there's no worries there's no no no

surprises there's a sense of if you have

a dream you can do it and to sense that

freedom and give people the give the

buyers the sense that geez this is this

is the right thing for me to invoke all

my great dreams i just need the right

tools for that

so our promise

rests on really four basic pillars and

i'm not going to walk through each one

in detail but the sense of innovation we

can help them

innovate faster and better simplicity

it's not hard it's easy

partnership we're in it with them for

the long haul

and performance and that we're here to

support their ongoing success

so underneath each of that of that major

promises this four are four major

pillars if if if you will that we

continue to pivot to and articulate to

let them know that this is what

underpins what we do and why we make the

claims we do

so i'm going to skip a little bit into

some of the sort of advertising and give

you a sneak peek on how this brand is

starting starting to roll out if you go

to our website now you'll see it's very

black right

but so now you're going to see a couple

of different colors and i'm going to

explain in concept a couple of things

that we're doing here to sort of bring

that brand to life first you'll notice

is the colors green and gray green as

innovation growth

gray as steel strength

you'll notice that the customer's brand

imagery is portrayed heavily it's not

about us it's about the customer's brand

so you'll see that everywhere in all of

our our ads and our marketing is it's

not about us it's about them

and in the language here we have is

we'll you'll see a pattern coming up

which is the customer always comes first

their brand and their comparative verbs

which is

whatever they view is

important to them those the verbs we use

comparatively we do it better we help

them do it better with is a statement of

partnership and we come last right as

the partner so this is a repetitive

formula that we use in all of our our

marketing to sort of help convince and

show the brand

that it's about them it's about their

brand it's about their goals and we're

here as an enabling partner we're here

to help them amplify whatever it is that

they want

in a new website that you'll see soon

this is starting to roll out even more

so the statement you'll see on the on

the home page is great brands have great

ideas

we help make them possible right so it's

that sense of complimenting the user

complementing the viewer

complimenting them on the strength of

their brand and what their ambition is

and just to let them know that if they

want that we're the partner for them

and more examples of that that i showed

earlier

you know perialus or lanzand these are

all the comparatives that we're starting

to roll out now what we think is a

position of strength for us is

these brands are willing to let us

use their brand

which is

pretty rare in software

so

instead of us talking about our features

and our functions we're here to show who

are the partners that we work with and

how they're willing to let us

use their brand which is a tremendous

statement of partnership and that rings

loudly in the marketplace

so in summary what i'd say is when you

think about branding a lot of times we

often as marketers stop at features and

benefits and we think that's where it

goes

the ultimate measure of this is when you

get to the reward right what is the

emotional quotient that a buyer looks at

because that's the thing that really

people sort of resonate with and it

creates this sort of emotional

connection people always justify with

fact but when you sort of strike the

emotional cord

it's a tremendous advantage and that's

really where the power and strength of

brand comes from

okay terrific thank you very much james

so what's great about that hopefully is

it brings to life some of the real

challenges

but i'm sure all of you would love to

fast forward straight to the point that

jamie says to be able to talk about

customers

as partners to you but the reality is

many of us are going to start in a very

different place we aren't even going to

have our first customers and so where do

you start you haven't even got a

customer maybe you haven't even got a

product and you've got to figure out how

to get to that pla place that jameis was

articulating so clearly there

well before i give you that answer i

just want to point out something that

actually uh the demandware promise was

made very early on

uh you know literally as i said eight

years ago

and it wasn't really any different it's

just that we didn't have the customers

to back it up

so we made a lot of those same brand

promises and had many of those same

attributes around simplicity empowerment

etc it's just that we've now reached a

point where we can actually talk about

them with a customer viewpoint and

customer voice and bring that emotion to

the full

so let's jump to

what you might think about

it's one word

consistent

startups think they've got to have 10

different things that they go sell in

order to sort of overcome the customer's

objection actually the opposite is true

what you want is to find the one simple

thing it's often referred to that a

customer can attach to that they say wow

okay that's different so we're going to

talk about that in different forms

tonight but

the point being at the start if you can

pick at the earliest point and play in

in time in your business what it is that

you're going to represent and stick with

it consistently then the more likely it

is that will actually resonate with

people

so

we've already talked about this there

are values that you probably have built

in your culture

those things we talked about for example

discussed do your customers come first

do people come first do you stand for

service for example or do you stand for

technology these are key decisions that

you make early on you can bring these

into your brand very early on and you

can make them part of how you represent

yourself

then what comes out of this which is so

important i've mentioned it already in

terms of execution is that

if you are reliably delivering on those

promises you will get known for being a

simple

and obviously highly disruptive vendor

if you're enabling new capabilities and

so the trick here is for you to identify

these things on as as early as possible

and try to stick with them as be and be

as consistent as possible that's the one

thing that a startup can be accountable

for right from the get-go now for those

of you who weren't here at the uh

culture workshop there's a whole section

where we talk about values and teasing

them out and it's a fun thing to do i

actually recommend that you do the same

thing

for this except not internally you go

and do it externally go spend some time

with your first select set of customers

and have the discussion with them about

what are the things that they actually

are looking for that are not represented

in the marketplace that you might be

bringing to them that will stand out as

the first set of values that makes them

want to do business with you so that's

the mistake i usually find startups

doing they're doing this in the lab

whereas what you want to be doing is

doing this in the field and asking your

customers what's missing if you can do

that and if you can pull out some of the

items sorry the attributes and the the

opportunities that are out there and

distill them into something that is

authentically what you can bring to

market and that you're going to

represent you're going to be starting in

a good place

so hopefully that makes sense as a first

startup secret

now to put this in perspective um i have

a second startup secret with you for you

which is

start how you mean to end

who recognizes that logo

this is a test to see is awake

all right dumb question hopefully

everybody does although it has changed

but not much right all it's done is lost

its color

believe it or not apple started their

branding statement in 1977

that's a long time ago

it even predates me which is kind of

cool

uh so the fun part about this is

actually i remember this discussion very

well when we were all you know going

through the process of figuring out how

to launch my first company which was you

know selling applications on the apple

ii

which was you know so how do we relate

to this thing you know what what is

apple all about well they had this one

magical term any of you heard the word

impute

anybody care to to mention what impute

means does anybody know

i'd never heard of it i had to go look

it up but it turns out it's been

critical in apple's branding impute is

basically saying that whatever your

product or service is

apple will impute the value of it which

means immediately make you aware of the

value of it and so if you notice when

you open an apple product even the

packaging

is imputing the value of apple's product

being clear and simple and very

straightforward and right out of the box

delivering value that's what they're

trying to impute they're trying to make

sure right from the get-go one of their

brand promises which is this just

instant value comes across from the

packaging

so i'm not saying you have to be apple

but the point is apple didn't go back 10

years later and say oh we should you

know impute the value of our products

and make everything simple right from

the get-go they made that decision and

mike markler who actually did this

was very key in the early stages even

though jobs always gets the recognition

in bringing this discipline into apple

and if you read the story which is a fun

one you'll see that it really reflected

quite significantly early on in even

product design and that's of course what

we're here to talk about is how does it

reflect in everything you do

so hopefully that's given you a sense of

why brand is important and why it's very

strategic and where you might start

which is hopefully with a vision to

where you'll end

so let's move on to our second section

this one is actually i think very

straightforward but at the same time

also very fundamental it's all about

positioning

now hands up who thinks that they could

position their startup

absolutely uniquely today anybody

go ahead

you've got a new way to do compensation

do you have any competitors

not that we're aware of that are direct

competition okay that is a very valid

statement now let me ask you another

question and by the way thank you for

being so bold to step up i always

appreciate it um are there other people

solving the problem of compensation in

the marketplace today

are there people solving the same

problem as you today in the marketplace

uh yes there are okay so there are other

players

does the caster customer have

suddenly a new budget therefore for what

you're doing or are they going to have

to find money from an existing budget

they will have to find money from an

existing budget where an incremental

improvement on what's out there already

there now okay you said we are cutting

helping them cut costs

so we're actually a cost saving

proposition rather than a study problem

very helpful okay

so thank you very much

what i'm going to do is

just take that example and tell you this

is the biggest challenge i hear over and

over again with startups

which is in other words it's you're not

unique in this in this problem

we think we've got something unique but

guess what we're in a category that

already exists where there's a finite

amount of dollars that we've got to

compete for that basically means we're

going to fight it out with everybody

so

this section is all about well how do

you actually avoid fighting it out with

everybody

let's see we can answer your question

what you're trying to do in the first

part of positioning is occupy a distinct

place

in a potential customer's mind

so if the customer like can identify

that what you do is unique

you're in a great place but if they say

oh there's 10 other vendors who help

with compensation we've got a challenge

and that's where you go on to the second

thing which is to say well what unique

white space can i find in the

marketplace

now for those of you here in the value

prop session we actually spent a bunch

of time discussing this and so i'm not

going to go through this all again you

can find it again on the website we

talked about how can you write that out

in a way that at least positions you

for a unique set of customers with a

product that is differentiated that does

something that's not been done before

unlike the other competitors

and talks a little bit about the whole

product in other words the entire

solution that you delivered to to make

that possible

so with that in mind i want to bring

mark up uh from his experience at spot

fire

as part of the tibco organization to

talk a little bit about how did he do

this and then i'll come and generalize

it and try to address your opportunity

mark welcome thank you michael

um

you know positioning statements like

this they may look academic when you're

in the audience looking at these

frameworks but i can tell you they're

far from academic you really do need to

to get a handle on

how you're going to you know how do you

want to position and how do you want to

differentiate

your your product or solution out there

and

i think you should go through this early

and often frankly you know particularly

when you know when you're forming when

you're launching when you're pivoting a

lot of organizations you know when you

start a startup

you know the the ultimate path that

you're on is very unlikely to be the one

that you start on

so when you sense that the organization

is going to go through a change is going

to try to reach a different market a

different buyer come up with a new

solution i think it's good and healthy

to go through these these sorts of

exercises in fact

i'm going through one with a new

management team that i'm on tomorrow

i've been with one of michael's

portfolio

companies for about two weeks and our

organization is going through a pretty

significant pivot you know we're

changing the profile and the persona

that we go after so what do you think

happens

these things unwind

right when you when you when you try to

reach a new buyer you're thinking about

the value that you offer you have to go

through and think about each line each

word in this framework should be

meaningful and mean something

and i think when you get it right

they're so aligned with the opportunity

and the value that you're conveying in

the market and the differentiation over

a competitor that if you were to read it

from a competitor's standpoint the whole

thing would fall apart it wouldn't make

sense

so mark just to give people a bit of an

opportunity to get a sense of it what

did spotify do and why was this tough

for you and how did you solve the

problem here yeah good question so

spotfire um

was a private company were acquired by

tibco in 2007.

about 2005 we went through a very

significant pivot i had recently joined

the company

we were targeting mostly scientific

users in the data visualization space

right so we were selling to small teams

of people scientists you know people in

corners of organizations we wanted to

pivot and go after the executive ranks

we wanted to sell into the business

intelligence space

which had

you know bigger budgets bigger dollars

we believe we could get more scale we

thought the product itself would be able

to serve those needs

but we were virtually unknown in that

space anybody who knew that brand

thought about us as a scientific and a

technical and a technical product and as

often as the case as founders or early

stage people

you love the features so people tend to

gravitate to talking about what the

product or the solution does

not what it does for the target buyer so

when you go through exercises like this

you want to think about who are we

really really trying to reach there may

be a number of personas but you have to

pick one

you can't segment too tight especially

in an early stage organization so who

are we trying to go after what keeps

them up at night what are they

dissatisfied with that's going to be

enough for them to call us back or to do

a web search to try to find us or to

respond to an outbound you know email or

call or something like that

how is our approach different than the

competition what lines can we take that

our nearest competitor can't and as

michael had pointed out often when

you're an early stage company you're

solving things that are being approached

by other companies as well and we've

just got a different take on it and for

us we were going up against cognos and

business objects in hyperion really

well-funded organizations you know big

marketing budgets we were never going to

get there by saying that we were another

business intelligence tool we took a

slightly different angle which was

around focusing on the value of

decisions that people would make in a

product using spotfire we could help

people make better decisions and that

was the value statement and i'd say you

know jameis's points were right on that

was the elements of the brand we were

fun to use we were easy we would enable

users to make better smarter decisions

in every corner of the company and

that's what we ended up really focusing

on the you know on this on the

positioning statement and we as a

management team fought through this

thing it was ugly

thank you very much mark

so hopefully that gives you

and by the way the business intelligence

space that

mark was competing for was a very very

noisy space with very big players and

yet mark's team was very successful at

finding their unique positioning and

being very successful at building the

business around it yeah question

did you have to rebrand it

to so that people now thought of spot

fire as something for the business and

for the recent scientists oh yes

yeah yeah we uh we there was definitely

a rebranding effort for sure and i think

you know going through the same process

that james had outlined but for me it

started here we weren't going to move

forward until we had alignment on the

management team here when we did that

then we started going out in concentric

orbits and talking with the organization

but everybody in the company was tested

on this literally the ceo would

get in your face if you couldn't recite

this this framework and i mean that you

have to believe it that strongly and

then things like branding and campaigns

and programs fall in line they're much

easier to scale up because you're you're

kind of singing from the hymnal here if

you will so back to that point earlier

on one of the things that this

discipline provides is a consistent

framework

again that consistent word being the key

one for you to think about everything

you do in your marketing which is why i

say bring it up so early on now again

for those of you who weren't here for

the value proposition session we spent a

ton of time talking about this framework

and how you build the various different

components of it so that's up on the

site

but this is how it ends up playing out

in positioning

now i promised i'd answer the question

for the gentleman he was bold enough to

step up and say you know he's doing

something unique in the uh compensation

world but uh i would i don't want to put

this on you right away and i wouldn't

try to get you to instantly articulate

it that way although if you want to

you're welcome to stand up and say how

you might define that

up to you

do you want to take a try

go for it

all right let's go after app

for ceos and upper management

at

midsize and large enterprise

who are

having trouble driving behavior for

their employees

our approach is to

integrate into existing meetings to

calculate impact of every employee

using

regular

weekly

light

minimal overhead approach

that

i should have actually

segmented that calculates impact

in a way that everyone perceives us fair

and can be connected to compensation

unlike

existing

approaches which include performance

evaluation approaches that everybody

hates everybody likes our approach

their setup is

a new approach to performance management

and compensation

that

all participants appealing fair

treatment

improved engagement

and ultimately better performance for

all

players

i got to tell you to pull that off in

front of all you guys

uh you know on the spot that was very

impressive it really was so thank you

very much i think you're going to do

great i don't know what i'm going to say

at this point other than you know

great great starting point it really is

excellent well

here's the thing about this you'll

probably be doing it for the next five

or six or seven or eight years until

finally you can stand up and people go

what's the name of your company by the

way

fair

fair

fair setup until everybody says oh yeah

fair setup i know those guys they do the

best compensation system on the planet

and it'll happen if you persist with

that i think you can get there

but that's ultimately what happens right

if i say coke to you

i don't have to explain anything about

it being a soft drink or fizzy or tasty

you already know what it is but it took

a lot of money to get there and so

that's why what we're doing right now is

we're trying to figure out how do you

get there

from the starting point that will make

it most effective for you

so let me jump in and start to add some

value hopefully as opposed to just

asking audience the questions

the first thing that i see that startups

miss is this

everybody always thinks about that

differentiation in terms of technology

it's great that you might have a

technology differentiation in many

instances it's a great starting point

especially if it's a highly disruptive

technology but it doesn't have to be

just about technology you could have

some incredibly compelling

differentiation just by figuring out a

segment that's never been served before

so for example compensation is extremely

complicated in the insurance industry

there's a lot of different channels it

goes through there's a lot of different

people have to take a piece out of it

and there's a lot of different ways that

that calculation causes so many problems

that it gave rise to a whole new set of

companies we don't have to go into all

that example but that wasn't a

completely new segment that gave

opportunity for the business you're in

i would recommend that any business try

to find that first segment that nobody

else is targeting that could be your

differentiation right there

the second thing is to find some kind of

barrier to entry because believe me once

the big guys figure out you're on to

something interesting they're going to

come after you so what is it that could

be the barrier to entry again most

startups approach this and say well

we've got a better technology great

but if it's just better faster cheaper

somebody's going to come after you and

spend more money to figure out how to

compete with you or at scale and so that

isn't a good answer either but what's

interesting is that there are many

things and we've talked about one of

them if you were in our business model

session that is very difficult for the

existing incumbents to come after in

fact the larger they are the more likely

they are to be titanically slow at

responding and one of them is business

model if you create a disruptive

business model that creates a

an innovator's dilemma the great book i

encourage you to read if you haven't

read it from clayton christensen you

will see that this is an example where

even independent of your technology if

you come for example with an open source

solution the way our case study acquia

did at the last uh discussion and offer

free versus where people are spending

literally millions of dollars and

therefore are becoming dependent as a

business on getting millions of dollars

from their sales force and in margin to

support their overhead you will disrupt

them nothing to do with the technology

to do the business model

and then last but not least

what we want to try to find is something

that becomes sustainable to you and

again what i hear a lot of the time is

well we've got ip and patents it's great

nothing wrong with that but i'll tell

you there are so many examples of where

startups have better ip and even patents

around it but do you really have the

energy and the resources to compete with

an apple or a google or a microsoft or

whoever it might be in your in your

business uh eli lilly if you're you know

in the pharma space no you don't and so

even though you might have what it takes

are you really going to press it

wouldn't it be better if you came at it

with a completely different approach and

you had for example the first network

because you'd given away your product

free of existing compensation users that

was providing a completely different way

to benchmark that nobody'd ever done

before and that gave you a competitive

advantage compared to anybody else that

was there because it was free open and

now fully exploited and your core ip

ended up being not technology at all but

data

completely different game

that would be defensible because nobody

else had it so i really encourage you

not to get stuck in the trap of

approaching everything with a technology

bias but instead to think about these

key areas

as to how to define or redefine

the competition in a way that puts you

in a position to win

so how do you map that well

again for those of you here for the

perfect pitch i go into this in more

detail but it's up on the web again

what i like to do particularly because

we're at harvard by the way is come up

with a 2x2

and think about the high low

and this diagram is pretty simple it's

really about mapping your competitors

you might use for example bubble sizing

to represent their relative size

but the important point here becomes the

axes and the axes are always something

that people put up in exact ways that we

just talked about well we're faster or

better or we're cheaper it's okay but it

doesn't work in the long run

what we want however we get there is to

find this white space that nobody else

is occupying that's what we're talking

about

i recommend the thing you really spend

time on is this

it's the barriers

the barriers should literally cause the

competition to say

they can't move from where they are to

where you are so what's an example is

your software sas

yes okay

every on-premises solution that's not

architected for multi-tenant remote

development customization etc is going

to find it really hard to move into the

cloud and be offered as a service

so on-premise and sas is a great example

of a barrier

for anybody in the software world who

knows what i'm talking about here i can

tell you it's very difficult that is the

entire premise on which a company called

demandware that just presented got to be

worth you know nearly a billion dollars

why because the existing incumbents who

were offering e-commerce

stacks which was a lot of technology

that was sold on premise required people

to go and build all that technology and

customize it and guess what retailers

and merchants don't do that what they

spend their time doing is trying to

distinguish their brand merchandise and

market better and they don't want to

deal with all that technology so that's

all pain to them whereas the gain should

be getting straight online and

customizing the site to their brand's

look and feel that's all demandware did

one fundamental barrier between the two

though which is one's on premise and the

other one is obviously uh in the cloud

so those are the kinds of barriers we're

looking for here and you've already got

one which is great

obviously we can think of a couple and i

mentioned before they might be business

model

uh or they might be different axes here

then that gives you a chance to put

yourself in a position where you will be

unique and defensible

now the white space thing is what we're

going to talk about next how do you find

that white space what is it that makes

it possible for you to have some unique

position

and this is really all about the third

key part of the workshop targeting and

segmentation

so why is this important

well

if i could define the perfect startup

storm

it would look like this

you would have a disruptive business

business model the way we talked about

in that session you would certainly have

a disruptive technology

but you would also have a new market and

some great way to approach it in a

go-to-market sense

and in the at the middle of that

there would be a tremendous opportunity

for you

but before i get into the opportunity

here's the piece that i want everybody

to make sure they don't lose tonight

most startups are really struggling with

the amount of resource they have to go

after any market

so let's ask the obvious question is it

better to go after a big market or a

small market

anybody

more yep i'm not going to challenge you

again but yeah

big okay let's have your viewpoint for

big

if you're going to go into market and

somebody's going to compete into this

market you'd rather take a big space and

even if you occupy a meaningful

amount of it it's it's a substantial

market for you i think that's a great

answer

you were going to say somebody else say

small go ahead say it's small for a

startup because

if you can own that one small

market you can start to tap into other

markets after you

you know sort of broadcast your value

proposition one

very good

yep very good anybody else want to chime

in before we move on

obviously what two very different

viewpoints there right i actually think

they're both right

but the trick is to figure out how and

where and when they're both right so

the real challenge is as i posed right

at the beginning if you're a startup you

have very little resource to do a lot

with and so if you're going after a

large market you want to serve all the

needs of a large market you're going to

be very very challenged because no

matter what anybody says large markets

will have diverse needs by definition

very rare it's not the case but if you

can define a nice small segment and

that's the key word

so if i'd been fair i would have said

big market small segment

then your product market fit your

packaging and pricing your channels of

distribution to reach it and your

messaging communication can be that much

more focused

on those unique needs

and so you'll be much more effective

with a limited amount of resources

yet i will tell you again challenge

each of yourselves to think about this

early on because it's one of the biggest

problems i see with startups is they

start way too broad and then all of

these things are challenged not just

building the right product but then how

do you price it and package it for all

these different varieties of people

within this big market

also how do you

pick the right channel point uh channel

and distribution point to get it

leveraged through and what should be the

message in communication when all these

different needs are out there it's

really tough but if you can segment to

the point where you've only got one

particular target then you can message

directly and so forth and so

that's why this is such an important

model

and it's why i actually really want you

to think about a new way of thinking

about uh this value prop as we talked

about it before

all the things to recap that you were

here for those of you here that we

talked about discontinuous defensible

disruptive solutions those all still

apply but remember we said there are

four u's

those of you here unworkable unavoidable

urgent problems are the best to solve

and the last one was underserved in an

underserved market where there isn't a

really good solution right now now if

you put those back together again

what you end up with here

is a model that is right at the core of

this

something that i think all star startups

should look for

but i don't invent all the terminology

in this world and i'm sure many of you

read or heard of um

eric reese's book where he talks about

the minimal viable product

so the minimum viable product is

something that obviously comes from

figuring out what's the minimum you can

do for your customer but i would argue

that the minimum viable segment

is just as important

but the minimum viable segment overlap

with your product will make it possible

for you to target a much smaller area

and i don't hear anywhere near enough

work going on in this area when i see

startups getting going they spend all

their time saying okay how can we get

the basic functionality right but if you

don't know who it's for

what does it mean doesn't mean anything

if you know exactly the persona of the

person for whom you're solving that

problem by segmenting this way you can

nail it

but this is usually left out

so mvp is important mvs is just as

important and i really encourage you to

spend time understanding that

so what is a minimal viable segment how

do you get that how do you find that

this is the next startup secret

it's one simple thing

it's a common set of needs

so a lot of people tell me oh no no i've

got a segment it's finance

or even better still i've figured it out

within finance insurance okay

you know what it might be that but

what if those people in insurance have a

completely different set of needs

you know person to person you probably

haven't found a segment

but by contrast i've seen some great

products that span right across

industries you know insurance banking

and completely different applications

maybe even sales and marketing but they

have a common set of needs and that

might be for example very close customer

intimacy might be as basic as that

that's what you're looking for you're

looking for a place where the customers

when they sit down and say hey did you

use this product they can say yeah i

love that

and the common need kicks in and say oh

well i better try it then

and when you deliver on it they

reference each other and say yeah i had

a fantastic experience then the next guy

says well then i should try it as

opposed to well that's great but doesn't

meet my needs so why should i bother

trying it

and that's where the dissonance occurs

is if you haven't figured out your

segment to be these same needs

but by contrast if you get this working

you'll get this reference ability

happening customers talking to each

other saying yeah it met my need oh it

met yours too it meant yours too oh wow

these guys must be the leader in this

segment hey big deal and you end up

having your initial beach head and to

the gentleman who raised it earlier dead

right it becomes the place where you can

build

because you've now got credibility with

a set of customers and that let me tell

you from 30 years of experience is the

biggest challenge that startup has is

getting that first set of referenceable

customers to say yeah you delivered on

your promise that brand you stand for

bang on it's actually making me more

successful as a customer

so let's dig in a little bit more i've

already given you a bit of a clue on

this

the typical answer

and

a startup has is to talk to think about

this in vertical terms there's nothing

wrong with that you know maybe you have

a perfect solution for

uh you know automotive or government

there's nothing wrong with that at all

it's also possible to think about this

in completely different dimensions and

i'm just giving some examples size for

example you mentioned this thank you in

your you know a bold attempt to

obviously get through the positioning

statement that you were going after a

certain size in the marketplace that's

totally appropriate too

but again what if we could get to a much

more specific need that everybody has

i.e let's stick with the conversation

example if people had to get their

compensation approved in a certain way

to meet regulations

that might span across a bunch of

industries

but if it was something that had never

been done before and that users could

reference each other it could be really

interesting

so sometimes these are talked about as

diagonals because they cut across

industries it doesn't matter what your

terminology is the key thing is getting

these consistent needs and so i really

encourage you not to give up on

segmentation until you can answer that

problem and not to get distracted by

verticals or sizes or anything else they

may play an important part in your

segmentation but in the end you need to

look a couple of customers in the eye

and say do you both agree that you have

the same need and then if they do you're

onto a winner

so there's a lot more detail on this on

the website i'm specifically skipping it

tonight uh just to give our guests more

time but what you'll find we talk about

up there uh in one of the case examples

is how do you find a critical need

because back to the value proposition

you know finding something that is

urgent and underserved etc all the other

four years that we talked about is much

more interesting obviously than just

finding one that you know

people not not in a hurry to solve or

it's not that painful for them so that's

up on the website i encourage you to

spend some time looking at it we cover

this particular case example

so what's the startup secret out of this

i wish

i could distill this word even more that

i'm going to share it with you

focus

everybody's looking at me like yeah

does anybody think there's any more

important word for startup

okay either i will put you to sleep or

nobody's going to challenge there must

be at least one more word that's more

important money

i don't know

well okay you don't need to challenge me

i really don't think there is it turns

out the biggest challenge that we see

with every startup is obviously figuring

out where to focus uh and thinking about

that beach beachhead but why

because the number one problem i see

literally the number one problem i see

in execution with a startup is people

try to go too big too fast and they end

up contracting on failure

so just think about this for a second

which would you rather expand on success

or contract on failure

i mean

yet this is the number one issue we run

into people spend way too much time with

a grand vision

and starting on too broad a market

opportunity with not a clear enough

defined value proposition that's

positioned correctly to a minimum viable

segment to start to build that initial

set of referenceable customers that can

make the success and you said it earlier

thank you you're dead on so it sounds so

simple but it is the most important

thing that i'd encourage each of you to

try to find a chance to do now last time

i give this session i had a bunch of

people send me email afterwards and said

that's great but you talked all about

vision

and we've got to have a big vision and

what do you what do you mean you're

talking about both sides of your mouth

here so i've put a new post on the site

it's called vision versus execution

and it answers that question at least in

terms of thinking about the two the

bottom line is on it that you need both

they just have a different time scale

your starting point needs to be

incredibly focused your vision in the

long term for years out can be as broad

as you like defining you know how you're

going to dominate the world

in the future but don't go to customers

with a vision and try to sell it

go to the customers with the first set

of needs that you can answer uniquely

well and then talk to them about if

they're seeing that success how they

might enjoy the vision with you that

will will hopefully answer the question

that i got many many times in email but

thanks for the question for everybody

who threw it in there

all right well we've got through the

strategic session and now we're going to

get to the piece that hopefully gives

you some tangible basis to think about

how do you go about addressing what we

talked about which is the sales and

marketing cycle

and this is a cycle that many people

define in different ways it doesn't

really matter what i've got here as the

terms i'm not trying to be

specific about these except to say that

almost every buying cycle starts with

somebody finding you getting awareness

of you and goes through some set of

steps like interest in you understanding

what your proposition is engaging with

you to figure it out trialling it in

some way to see if it really delivers

and ultimately hopefully purchasing it

well if it does all those things

if you do all those things excuse me you

will obviously find a way at some point

to be you know building some

repeatability what we're going to talk

about now is a couple of things i've

learned along the way that typically

gets skipped over the first is

personifying it so this is like the next

level down from segmentation and again i

often hear people completely skip this

so i'm going to come up with a couple of

terms here that make it easy for you to

remember hopefully the word i use is

actors

and that is to say

there are various different stages

that the customer goes through

when they're dealing with you so think

about actors on a stage just that's the

reason i came up with that analogy

and the customer actors are very

different

through this cycle in fact it's usually

what people forget so for example right

at the top of the cycle

if you're an early stage startup you'll

often be dealing with visionaries these

are people who are looking for

competitive advantage from this breakout

proposition that you've got

visionaries are great but there are very

few visionaries who sign checks

unfortunately not always the case i mean

you might get lucky

and it's something obviously you can

find it it's great what you'll usually

find is the guy who writes the check is

actually an economic buyer and maybe

again if you're lucky he's the decision

maker but he probably has a boss too

especially selling to large enterprises

or even if you're not even if you're in

a not-for-profit and you're trying to

sell to for example a foreign government

trust me this gets even more complicated

uh which is one of our case studies so

what i encourage you to do is figure out

well who are you dealing with are you

dealing with visionaries are you dealing

with technocrats people who actually

evaluate the technology the people who

have to operate it to actually

operationalize this to get it working

the influences which is sometimes

different again the people who have if

you like the political clout in the

organization the economic buyer or the

decision maker and again i'm not trying

to say these are the only categories but

it's just to get you to think about the

kinds of actors you'll be dealing with

and why it becomes important

is that

do you really think you're gonna have

the same message for all these people

i see lots of heads shaking why not

go ahead because they're motivated by

different things absolutely

the the guy who's at the visionary is

probably trying to get some competitive

advantage in his you know thought

process to convince people that he's on

the right track

this guy down here probably doesn't give

a damn about that he's just very focused

on some kpis that he's got to meet to

get you know paid off at the end of the

quarter

and he's he's probably feeling this

guy's a nuisance so the very different

motivations here uh the guy who's

operating is not at all interested in

how much it necessarily costs he's

essentially does it run efficiently

and and think about this guy he doesn't

even give damn with his technologies

better he just wants to know that it's

cheaper and faster and all those other

things that makes it possible for him to

get the best deal they're just different

motivations and yet again i see the

startup world obviously you know

approaching this and saying well we've

got a great value proposition but

they're not thinking through how they're

going to apply at these various

different stages

now one of the things i want to point

out is that the bottom line

the purchase

is actually made ultimately by everybody

coming together and we refer to that as

the decision making unit the dmu

and good sales people know what a dmu is

they figure this out early but i

encourage you as well to be thinking

about this who is the dmu who's the

group of people that when they come

together will ultimately say yeah we've

got to buy this

and once you figure out what that group

is and what the politics are you'll

figure out how to get to the next key

startup secret and that is

how do you qualify early and often

can anybody tell me why this is

important i mean it's all up on here but

just tell me from your gut instinct

happy to ask one of our guests if they

want to chime in here why is

qualification important early on

you don't like the freshman resource

thank you jameis

geez you should be a vp of marketing and

a great company

what's going on here is is

you know you're taking customers through

a lot of different steps so imagine if

you take them through all these steps

and you find out you really didn't

qualify that they have the pain and need

and the right decision-making unit to

actually take you to the close

wow you just could waste have wasted

three six nine sometimes more months and

all that resources of precious startup

is just lost

yet that's what i see happen in most

startups they don't spend enough time

defining that target segment that

minimal viable segment that we talked

about against which by the way you

qualify the customer to figure out

whether they're going to be somebody you

can meet

the need of and therefore you know

there's so much time lost so qualify

early

save all the time and money up front

qualify often because things change

and i really do mean that like as

startup times you know basic things

happen like your economic buyer changes

from position to position in big

companies

or importantly