Selling to the Enterprise. For Bootstrappers.

My bootstrapped startup once made £12,000 for just two weeks of work. Two weeks to discover a new lead, close a sale and on-board them onto the platform. We didn’t expect it to be this easy when we learned who the customer was - a Fortune 500 company who makes most of the products in your bathroom. We thought we were geniuses who had cracked this thing other people called “Enterprise Sales”.

A few months later we found another enterprise customer. Lured by the promise of an easy sale, we agreed a similar price for the engagement and got started.

A year since we signed the original agreement, we have;

Rotated through an entire team worth of people at the customer company.

Answer over 800 questions related to security infrastructure.

Never yet delivered a completed production implementation.

The project is still ongoing. It has taken up a significant amount of our time. We haven’t been paid a dime.

What went wrong here? Why has this deal been such a failure compared to the first one? How can we sell our products to enterprise customers successfully?

This post contains some of the things I’ve learned along the way to help you successfully close enterprise clients and keep them as highly profitable customers.

Welcome to Selling to the enterprise. For Bootstrappers.

A few things before we start.

This will focus on what to do after you’ve already found an enterprise client and have begun negotiations.

Many readers might ask “How do I find potential enterprise clients in the first place?”. The process isn’t that different from finding any other B2B customers - with a few exceptions. I might explore this in a future blog post.

1. Find an internal champion.

An internal champion is an individual employed at your target company who will help expedite the sale. Champions do this by removing bureaucracy and advocating for you. The ideal champion should strongly believe in your product and team. They will be willing to risk social capital to see the relationship work.

You must understand the incentives of your champion. The more they stand to benefit from making the deal work, the harder they will push on your behalf. Ideally, your product should be able to contribute to the commercial metrics that decide how large a bonus your champion will receive. Or perhaps promotion season is on the horizon, and they are looking for a way to stand out from their peers. If you can help them get nominated for a company award or get the attention of the CEO, you are aligning the success of your product with the success of their career and they will work hard on your behalf.

Treat your champion with respect. Remember that a part of your job is to make them look as good as possible to their colleagues and peers. Do this and they will become big advocates for your product, helping you to close your deal quicker.

2. Don’t quote a price until you understand their supplier onboarding process.

You should decide your price point for enterprise clients on a case-by-case basis. One of the reasons for this is that every large customer will have a different process for onboarding a new supplier like yourself. These process can vary. One company may be happy to sign a contract and give you a credit card number. Another company might ask you to undergo expensive, bureaucratic processes before they will use your software.

You want to price these processes into your final quote to ensure they are worth your time. If the client’s requests are too challenging, you may even decide not to proceed with them at all.

If you quote a price before learning about the onboarding process, you damage your negotiating power. You increase the risk that you will spend more money onboarding and managing the client than you will make from them.

We’ve made this mistake. Days after we finalised the price with a new client, they asked to see a penetration testing report of our software, conducted by an independent third party. At this time, we had never heard of SOC2 or penetration testing and told them we didn’t have one. They replied that it would be mandatory if our relationship was going to continue.

Undergoing the penetration testing would offer value to us as a company, and it would secure a new client. But it cost too much for us at the time. If we knew this before quoting, we could have included the price of the penetration testing in the quote for the client.

One final tip here. The first time you undergo this process with an enterprise client, document everything in such a way that you can re-use all of your written assets. The next time a client asks you similar questions, answering them will be as easy as forwarding them a PDF.

3. Figure out how easily you can customise your product.

Enterprise clients expect the products they buy to fit them - not the other way around. As a vendor, this means that you should be prepared to offer reasonable customisations for the right fee.

Not all customisations are reasonable. If fulfilling a request by a potential customer would cause your product roadmap to be put on the back burner, it is worth declining the customer or negotiating to a more suitable middle ground that won’t cause you so much disruption. Alternatively you can make the price so expensive that they either say no to you or pay you enough to put another three months on your runway.

Customisation requests may include things like:

Managed account migration

Hosted behind a firewall that they control

Hosting on a custom domain with a SSL certificate that they provide

SSO with GSuite / Active Directory

White glove onboarding and training

Themed to match their company colours

Deployed in their cloud account

Be prepared to answer questions about these features, even if it is to say “No”.

I’m unsure exactly how much you should charge for each of these. But make sure it’s at least in the four or five figures a year range. I’m currently doing research to quantify this better and will publish additional posts once completed.

4. Learn about their payment politics.

Understanding the processes behind how your client company validates and processes supplier fees is important. For the buyer you are negotiating with, “how difficult is it going to be to get this supplier onboarded and paid?” is often a more pertinent question than “is their price reasonable?”.

In many cases, the amount you are charging makes an unnoticeable difference to their team’s annual expenses. But the process of managing the purchase, getting approval and submitting the correct paperwork can take hours and hours for your buyer to complete. Losing this time has a more noticeable impact on the team than your purchase price does. You want to do anything you can to make the process as easy for them as possible.

As an example: our company was once contacted by a marketing team from an established cloud computing company. They wanted us to provide the platform for an internal virtual event - a great opportunity to get our product in front of some of the best sales and marketing folks in the tech business.

We were keen to secure the deal, and so quoted a generous price for the event. To our surprise, they replied asking that they actually wanted to pay around 20% more for the package than what we had quoted. The reason they gave was to ensure that we were fully incentivised to deliver a successful event.

As the project and our relationship developed with them, we learnt a lot about the hidden internals of how their team operated.

The higher amount that they asked to pay was the maximum amount their team could charge to their corporate expense credit cards without requiring a formal purchase order process. Additionally, the manager who would be authorising the expense payment was part of the team attending the event and was fully supportive of using our platform.

At that time, the wider company also had a ban against using external virtual event platforms like ours, but none of the internal platforms the team were authorised to use were a match for their use case. Had they triggered a formal PO process, and all the supplier onboarding red tape that would come with it, they would have had a fight on their hands and the deal likely wouldn’t have gone through.

We had quite a few takeaways from this experience.

We were undercharging for our product. (Duh.)

Corporate expense accounts for marketing teams can be wild.

They were more concerned with dodging their own internal bureaucracy than they were with squeezing the best deal out of us.

The lesson here; as early in the relationship as you can, find out how they intend to pay for your product and what additional hoops and considerations could crop up. Don’t be afraid to ask questions like: “what can we do to make this easier to process for your accounts payable department?”.

Be flexible on your terms and give them multiple methods to pick from when they pay.

5. Be prepared for team churn.

Over time, expect that the team members in your client company will move on. They might move to different teams or leave the company completely for greener pastures.

You need to be prepared for this. It will be hard to ensure a long-term relationship with your client if you no longer have anyone in their company who personally know you well and trust you.

To counteract this, you should focus on getting to know one or two other folks on your target team once you are inside the door. At the end of a catch-up call with your champion, you could ask them something like this -

I would really appreciate it if I could be introduced to a few other members of the team to ensure they are comfortable reaching out to me if they have any problems whilst you are uncontactable or on vacation.

They might not have thought of what will happen if they are away on holiday and someone else on their team has problems with your software. You can solve this by offering to get to know one or two others on their team, whilst also protecting yourself from the risk of team churn on their end.

6. Create a repeatable process.

I’ve hinted at this above, but it’s so vital that I’ll reiterate it here.

You should aim to fully document every stage of this process to a high level. Once you have done this, incorporate it into your client and internal-facing documentation. The next time you engage with an enterprise lead and they ask for your GDPR statement, or what invoice terms you offer, you should be able to reply to them by either a) forwarding them a ready-made PDF or b) forwarding them to a documentation website.

Reducing this friction is the only way you will be able to make enterprise sales worth your time. And don’t forget - you can keep charging the same high prices, even when your internal process becomes more efficient.

To Summarise

When negotiating with a potential enterprise buyer, ensure that you:

Find allies in your client companies as early as possible.

Don’t quote a price until you understand their supplier onboarding process.

Figure out how easily you can customise your product and how much to charge.

Understand their payment politics.

Plan for team churn.

Create a repeatable process.

What we haven’t spoken about.

There are a lot of additional topics I’ve not covered here, such as:

How to find and approach new enterprise leads.

How to expand horizontally inside a client company.

Paper-work, contracts, payment terms and more.

How to find potential allies inside a target company.

How to price your enterprise add-ons.

Is it worth getting SOC2 certified?

If you would like me to talk about any particular topic, reach out to me on Twitter (@thisischarlied) and let me know. If you want to be notified when I publish my next post, follow me or subscribe below.

Happy Hunting.