Yesterday I wrote about the 3 different ways to expand growth in an energy and industrial account. I highlighted that “Product-led growth tends to be the most stepwise in commercial advancements.” Today I wanted to highlight the techniques that I have seen work well in accelerating a software company’s march through the rest of the organization.
Tip # 1: Keep the Sales Exec on the account post-sale for as long as the original sales cycle. Yes you can bring in Customer Success but maintain strong sales presence. A huge mistake I see is when firms immediately hand-off the sales executive. My rule of thumb is that the sales executive should stay involved post-close for as long as the sales cycle itself. So, in a 9-month sales cycle, the sales exec should stick around for another 9 months.
Tip #2: Set up a “Digital Innovation Meeting” 5 months post-sale with the Customer. Ask the customer to include the budget owner and the lead user. From the start-up side, include the sales exec, customer success rep, and a customer-friendly product manager. This is where your Sales Exec’s “nose for revenue” becomes valuable as the sales exec should identify 1-2 other execs in the customer organization to invite. This is why it is important for the sales executive to stay around: their nose will hear recurring names and themes / problems that could be a next product opportunity.
Tip #3: Establish a Customer Council. Most customers in this space are very keen to make sure that they are keeping up with the peerset. Therefore, an early stage firm providing customer validation is incredibly important. Similarly, no single critical infrastructure firm wants to be the only customer you have in the segment. A customer council gets a similar cohort of customers together to share positive engagement examples and aggregate future product recommendations for the start-up. This gathering can be very powerful to drive both new revenues and demonstrate long-term commitment to the relationship. In summary, energy & industrial customers all want to move forward in new technology endeavors together. By setting up a customer council, a startup easily expands the narrative from a product to a broader technology and software partner.
Tip #4: Have Well-defined and Clear Pricing. Expanding your product internally best happens when there is clarity on the boundaries where the current product’s value and associated pricing ends. Being clear on the purpose, features and intra-company user makes expansion easier later in the engagement.
Tip #5: Write up a Master Services Agreement. Most start-ups will rush to close the contract. More mature entrepreneurs will simultaneously explore a MSA. A MSA is contract reached between the start-up and the customer, in which both parties agree to most of the terms that will govern future transactions or future agreements. This usually brings in more senior sponsorship, and accelerates follow-on sales since there are defined parameters around everything from data treatment, press releases, onsite visits, and vendor validation. And a hidden bonus is that if suddenly a budget becomes available near the end of the year, the start-up can be easily contracted for the software opportunity.
Tip #6: Collaborate with the Customer’s Consulting/Innovation Advisor. Almost every Fortune 1,000 energy and industrial customer has a consultant: Accenture, IBM, Deloitte, etc. These consultants have multi-year relationships and usually have proposed a dozen ways to streamline or digitize the corporate’s operations. These consultants also want to see the concepts materialize and identifying what digital solutions are aligned with a start-ups core competencies can lead to a nice expansion. And be sure to identify ways to compensate the consultant with an integration deal or services recognition thereafter.
Tip #7: And surprise, #7 is coming next week 🤓