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Practical advice for cyber security entrepreneurs. Learn from our experience.


18
OCT

Focus on Strategic Customer-Partners in the Early Stages of your Startup

Is your venture only about profits? For a startup, increasing sales and building a  customer database is important, of course. The question is whether at the earliest stages, it should be your main priority. I believe that developing strategic customers (partners!) should be your top priority. But to realize the benefits, it’s essential to create a feedback system.

So what is a feedback loop and how do you create it? What turns a sale into a strategic partnership is the extent to which you help your champion make his or her own internal sale to the rest of the organization. This can only be effective with constant dialog and support at every stage.

At each point in their sales cycle, you need to understand the process that followed inside the organization. You need to make your strategic partner feel like you are on the same team, which of course you are – your customer is an integral part of your success. When it becomes a team sport, it builds loyalty and confidence. A sale then becomes an excellent trust building exercise.  

Another way to maximize collaboration is to  include strategic partners in product design. I want to emphasize that your customers are a key stakeholder in your business, and major decisions should factor in their opinions and ideas. This will make the strategic alliance mutually beneficial and sustainable in the long term – and generally lead to a better product as well.

Here’s an example: Your startup has a minimum sellable product and some cash in the  bank  from the seed round. You may be in the  process of raising more money to grow the development and sales teams. The greatest value that strategic business relationships can provide right now is through seriously  testing your product, enabling you to iron out the wrinkles while your company is small and agile, so you can later scale efficiently.

For an Israeli cyber security company, seek strategic partners that are early adopters, ideally in the US and Europe where your main market will ultimately be. You are off to a great start if they think you have a chance at relieving their pain points.

Early adopters provide a unique and invaluable hands-on perspective of what's right for the market you aim to serve and what needs to be changed to improve your value proposition. These companies will be less focused on final returns and more interested in getting your prototype to beta.

It is absolutely ok to provide a version of your product to initial customers for free. Your first customers should be your strategic partners, whether they are paying or not. They enable your team to validate the technology  in a real-time environment. They are the best marketing channel you will have. And they are also the best way to increase valuation when approaching VCs.

I’m giving you permission to put off profits. Create the very best product and deliver excellent customer experiences – even before you raise money or hire a sales team. Find strategic partners. This is the right way to build a successful start-up.