Fortune 500 Companies are Not Dominoes

Fortune 500 companies are not dominoes. Getting one to buy your widget does not mean the rest will fall in line.

There is a common misconception among young entrepreneurs that if one Fortune 500 company makes an investment in a product, the rest will quickly fall into place – to reduce the risk of trailing their competition.

This premise is false for a couple of good reasons:

First, the people to whom you are making the sale, frankly do not care if their company falls behind their competition. They’re simply looking to hit sales or hiring quotas so they can keep their job. Either you’re going to help them do that or you are not. The exception, of course, is when you’re talking with board members, but as a young entrepreneur, even if you do get a meeting with one of these big wigs, you will likely be passed down to a lesser employee.

Second, most companies would rather let their competitors spend money on a new piece of tech first and then watch for the ROI. If they have success with your widget, then they’ll consider buying it. Otherwise, the value of your offering poses too much risk. There is no incentive to buy while the risk is high when all they have to do is wait a few months to see how things play out. After all, you’re not likely to turn down their money if they offer it later, once they’re more assured of your value.

So what does this mean to a budding entrepreneur? It means you need to assure that your product provides tremendous value to an individual inside a large corporation rather than providing value to the company at large. This can be a sales manager, project manager, marketing manager, etc. If your tool can increase their efficiency and make them look more effective, you’ve probably got a winner.

You may also want to review your pricing strategy, making your product affordable to anyone inside the Fortune company and then doing volume sales inside that organization.

E.g., don’t try to sell a $100,000 license to your recruiting software. Instead, make the license $200/month and sell it to 50 recruiters at one company. Sound difficult? Sure. But the $100,000 sale is a lot toughter. Moreover, it only takes one HR Director saying no to the $100,000 sale to sink you at a Fortune company – but there are PLENTY of recruiters to go around. So even if 10 say “no”, there are still plenty of others who may say “yes”.

Good luck!

It’s a marathon – Not a sprint

Running a successful business is a marathon, not a sprint.

The 90-hour week is a foolish endeavor born of reading “Art of the Start” one too many times. In truth, many of the stories entrepreneurs tell of the hours they pulled to make their companies successful are highly exaggerated. Organizational psychologists say after 50 hours you are wasting your time and you will spend the next 20 hours fixing mistakes you made during those candle-lit nights.

That is not to say that you cannot (and will not) pull all nighters. But working on Christmas is not only unnecessary, it is downright foolish.

It’s tempting to just work around the clock and expect your employees to follow suit, but a tempered approach will do more to keep everyone happy. The last thing you need is for those who work longer hours to start resenting those who work fewer – because the mood will catch and soon you’ll have an entire office of disgruntled employees.

Instead of giving out gold stars for working long hours, give them out for producing great work – regardless of whether it was completed during traditional business hours or during what should be “off the clock” time. This will encourage more successful efforts – not just time spent.

And isn’t success, after all, the bottom line?

Quietly Taking Over The World

Welcome to Leading the Nerd Herd.

Technology keeps advancing. It’s vital to it to stay on top of the advances because the importance of those who understand and know how to use it will only continue to grow.

Those in the herd live by this fact. We stay online and connected. We revel in the latest and greatest. We’re the early adopters who alpha and beta test, so that the rest of the world can have products that are easier to use.

I’m lucky enough to not only be a member of the herd, I’ve taken a position in helping to develop tech. On this blog, I’ll post thoughts about technology, web development, and business entrepreneurship.

Got a question? Just send it to me.