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4 Quick Lessons in Scaling Your Startup

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My startup experience began in college at what ended up becoming a very successful company. After graduating, I moved on to a corporate role at IBM. As I learned the ropes at an established company, I continued investing and advising startups on the side. Finally, two years ago, I founded my latest company, SimpleRelevance.

rsz_incontentad2Through each career move, I’ve learned the value of practicing an intentional business strategy. Putting short and long-term goals against decisions and challenging my own choices has been the best way for each of my companies to pivot and evolve. Here are few of the lessons I’ve learned in my latest endeavor and over the years:

Fast Cash Doesn’t Sell

Telling a prospect that you’ll earn them $20 dollars for every $1 dollar they spend on your solution seldom works. It seems too good to be true. While your promise might still stand, it can’t be the sole selling point of your product or service. In the customer’s experience, there probably was someone who couldn’t deliver on such a bold statement before you.

To beat a potential customer’s skepticism, it’s important to offer proof of credibility. This can be done using case studies or testimonials from past and current clients, through trial period offers or product guarantees. For SimpleRelevance, we know there is a certain amount of noise in the marketing services space, but we’ve found continuous success for each client on each campaign, and have the proof to back it up.

Find the Right Target

Make sure the person you’re talking to has a stake in the conversation. In the past, I spent time and energy explaining the importance of using my solution to the wrong person because I was looking to get my foot in the door.  It never worked out well. If the person isn’t directly impacted by your value proposition, they’re not likely to make the purchase or even hand you off to the right person.

Find the person responsible for showing results in the specific part of the business your product affects. For us, it’s often a CMO, director of marketing, or person in charge of email marketing. These are the folks who feel support and recognition for increased sales directly correlated with email personalization. They’re the people who are actively seeking new, better technology to make their lives easier. Find someone who would get the pat on the back for choosing you, and you have potential for a real conversation.

Find Your Differentiator

There are a lot of industries that seem crowded, including marketing services. Recognizing the amount of noise in your space is key to fighting it. For SimpleRelevance, there is often a misconception about who our competition actually is because of the plethora of buzzwords that describe the industry: email marketing, email service provider, email optimization, digital marketing, etc. There are thousands of companies who fit in each of these buckets, but very few who are direct competitors offering the same outcome.

Going through the TechStars process taught our team the importance of being thoughtful about how we position ourselves against our competition. It’s absolutely mandatory to be crisp, concise and to the point about what we do. This eliminates confusion from jargon and shows our prospects how we can truly help them. We’ve actually got ours down to about 10 words: SimpleRelevance plugs into existing tools to optimize an email at the individual level. Spend time refining your real message and differentiating factor so when a prospect compares you to your competitors, you’re able to explain exactly why you’re the better choice.

Scale Thoughtfully

Finally, when founding a startup, the inability to scale properly is an often overlooked internal issue. There is no shortcut leading a company from under 10 employees to 40-plus. Instead, each department must mature at the same rate, or at least close to it. Product, sales, marketing, operations and customer service all require equal attention to detail and support. When things get out of sync, the business loses equilibrium, which causes unnecessary internal hurdles.

Some startups take growth where they can get it and expect things to even out on their own. That works sometimes, but more often than not, these issues can cause even a five-year old company to implode. Remember, happy employees make a company successful, and instability threatens that.

There are many more lessons I’ve learned from founding SimpleRelevance, but all of these suggestions have one principle in common – be thoughtful. Successful businesses aren’t built in a year and they don’t materialize out of thin air. But with deliberate choices, the right message and the right team, yours will come together with time.

Erik Severinghaus is the founder & CEO of SimpleRelevance, a Chicago-based company focused on digital marketing personalization. Prior to that he received a patent while in IBM‘s IT Optimization organization, and helped co-found iContact – a leading Email Service Provider.

The Young Entrepreneur Council (YEC) is an invite-only organization comprised of the world’s most promising young entrepreneurs. In partnership with Citi, YEC recently launched StartupCollective, a free virtual mentorship program that helps millions of entrepreneurs start and grow businesses.