Yesterday I was at an event in Palo Alto by Sales4Startups Inc. I can highly recommend them and I like the idea. These are great, idealist people – good speakers also – with a mission. Check out their web page.
One can not reiterate how important it is to have good sales. So many people in Silicon Valley are engineers, some of them even despise sales. But sales is not bad. Not for the customer and not for the vendor. If you have a good product, you can have an honest sales process and don’t have to be ashamed of it – that’s part of entrepreneurship! And it is necessary to build up your company. In fact, sales does not even have to be about money. It is about promoting your product. This happens in the open source world as well. Why are some projects more successful than others? Take Linux for example – why is it Linux that has become what it is and not FreeBSD? Or MINIX? Obviously somebody was a better seller, even though it’s all free stuff.
What struck me a little though – unrelated to the actual Sales4Startups event – was a quick talk I had with a Venture Capitalist. Now, my company Stratodesk has customer traction and is not in need of buildup money, but still one engages in a friendly conversation. The VC said something I of course had heard often before in various forms: “We don’t even look at companies in San Francisco, it’s too far to drive up there”. So this is not about this particular person, rather the whole tradition has somehow has evolved: I mean I was driving 45 minutes from SoMa to Palo Alto yesterday around 5pm and it was the time President Obama arrived at SFO. Is this really a problem in a country where people drive an hour for dinner? I mean we are not talking about being in Wyoming or so. Now to put it differently I know that a significant portion of the Silicon Valley VC community indeed wants to see their ecosystem in a 20-minute-drive radius around Sand Hill Road. So far so good.
But is this what you as an entrepreneur deserve? Wouldn’t you rather want a VC that goes through thick and thin with you? That is flexible and adapts to change? How will somebody who refuses to drive even to The City then react to an important change in business plan or technology that you propose? That means, for all those VC companies that like to differentiate themselves (and I know a lot that successfully do), yes, I do think there is a market for you…
Now, back to the original topic of this post. The better you are at sales, the less likely are you to need early-stage money, thus increasing your company valuation and making you less dependent on VCs, but for those that you finally work with, it makes you a better investment.