The Startup Chat with Steli and Hiten
302: How to Sell to Startups? (Startup To Startup Sales)
Apr 20, 2018
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In today’s episode of The Startup Chat, Steli and Hiten talk about start up to start up business sales and explore how to market to startups. They also discuss the viability of if it can be a long term and sustainable strategy.

A startup is a fast paced business that develops its business model around innovative services or products. They are modern, public, online and often uniquely approachable. This low resistance and interactive approach makes the startup to startup sales strategy one that can be challenging but also very beneficial.

Tune into this week’s episode of The Startup Chat to learn about the good and the bad of startup to startup sales. Steli and Hiten’s share their top tips for how to get started and identify new opportunities with startups, for your business.

Time Stamped Show Notes:

00:34 Startup to startup evolution.

01:03 The common step in the startup sales strategy.

02:48 Using funding to fund other startups.

03:26 Key factors to account for.

05:46 The startup to startup sales trend.

06:35 The benefits of selling to startups.

08:33 The positives of startup to startup sales.

09:11  How to reach out to the founder of a startup.

10:15  The negatives of startup to startup sales.

12:40  Things to be aware of in startup to startup sales.

3 Key Points:

Go after the right customer from the beginning.
You should be emailing other startups to use your startup.
It is much easier to market to startups, as startups are very public also they are using all of the new tools.

[0:00:00]

Steli Efti: Hey everybody, this is Steli Efti.

 

[0:00:03]

Hiten Shah: And this Hiten Shah, and today on the Startup Chat, we're going to talk about something that Steli and I have seen evolve, whether we are conscious to that evolution or not. And the idea is when startups are your customers. This is the idea of there's B to B, business to business, there's B to C, business to consumer, and then there's ... There's other ones two, but the one we want to talk about is this new concept. I think Steli, you might have just invented it, like literally 30 seconds ago.

 

[0:00:33]

Steli Efti: Yep.

 

[0:00:33]

Hiten Shah: Which is startup to startup. And what we mean by that is when you're a startup and your primary customer is another startup. Right?

 

[0:00:43]

Steli Efti: Mm-hmm (affirmative), yep. Which is very often the case, right? I mean I would say if we look at startups that try to sell to other businesses, independently if those other businesses, eventually if the aspiration is to sell to a large enterprise or small local businesses, often times the first type of business that a startup will try to go and pitch and acquire as a customer, are other startups. I think we should talk a little bit about that in terms of the evolution of it, but also how do you sell and how do you market to startups? What's good, bad, what's working, what's not working? But also I'm a little curious to touch on the idea of, is that just a stop gap solution, is that just like a first step, similar to saying you're going to raise a family and friends round? But if you really want to build a big business, eventually you're going to have to go to venture capitalists to raise money. You won't be able to raise $100 million from friends and family, at least not most people. Is selling to other startups, doing startup to startup sales, is that just something to get things started and not really a sustainable strategy long-term? I'm curious to explore that idea as well, but let's start with the question of, was that always the case? Were startups always tending to go and try to get their first kind of customers being other startups, or is this something that just happened recently over the last 10 or 5 years, or so?

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