This is the next entry in our “Best of” series, in which we venture deep into the vault to replay blog opinion and insight that has withstood the test of time. Today’s post hails from May 2009. We welcome your feedback.
By Francis Moran
I was interviewed a few weeks back by the Ottawa Business Journal for a piece on marketing through a downturn. While a good bit of what I had to say did make it into the article, I thought it would be useful to expand on my thinking here. So, here are my 10 tips for marketing through a downturn.
1. Do as much marketing as you can afford
We’ve written a lot about the merit of maintaining your marketing spend through an economic downturn. There is still business to be written, markets to be taken and customers to be won. And a downturn, when many of your competitors may well be going quiet, often represents an unprecedented opportunity to grab a much larger share of voice.
Read More
By Francis Moran
One of the more thought-provoking presentations at last week’s International Startup Festival was by Randy Smerik, a serial entrepreneur who has lived through more than one startup, venture capital investment and eventual acquisition. His personal experience added a significant note of authenticity to his session, “Build 2B Bought,” but it was the statistics he presented that really got me thinking.
Let me summarise Smerik’s narrative.
- There is a 90 percent chance that the eventual liquidity event for a startup will be its acquisition by another company.
- The average merger-and-acquisition (M&A) exit is worth $20 million.
- A VC investing only $2 million into a company and acquiring 20 percent of its equity based on a $10-million post-money valuation will need to earn $20 million on that investment to get the minimum 10x return that VCs target from each investment. (Admittedly, Smerik did acknowledge that most funds get a 20x to 30x return from two out of every 10 investments they make, with the other eight returning little or nothing.)
- At a 20 percent ownership level by the VC, that means the company must sell for $100 million.
- But the average M&A deal is only $20 million.
As Smerik said, “Yikes! This is a problem.”
Read More
By Francis Moran
There may be nothing quite so ubiquitous in the normal sales cycle for the enterprise software market as the software demo. And there may be nothing that kills as many promising deals as the software demo done poorly. And yet, the demo is such a critical part of the sales cycle. Delivered at the right stage in the sales process and sharply tuned to the prospect’s real needs, there are few tools in your sales kit more potent than a well-run demo.
The karmic gods must believe I deserve punishment for some dire past offence for they have obliged me to sit through well more than my share of wretched demos. The only solace I can take is that I don’t seem to be alone in this; a quick scan of colleagues plus my own experience made the following list of software demo failures all too easy to compile.
Read More
By Francis Moran
Outside of my annual summer vacation, one of the things I most look forward to when the weather turns hot is the International Startup Festival, returning to Montreal from July 10 to 13 for a third great year. I chatted this week with Phil Telio, the festival’s maestro, to get a preview of what the startup entrepreneurs, investors, support community members and general hangers-on (like me) can expect from this year’s edition.
I started by asking Telio why the festival was such a success. “You tell me,” he declared, before itemizing factors like “economic development is super important to any community,” and “there’s a real hunger for startups” to be part of that development. Mainly, though, the festival is “fun and playful. I think people appreciate that it’s not a stuffy investors’ conference where people are all wearing suits and ties.”
“And it’s Montreal in the summer!”
Read More
By Francis Moran
Ottawa finally got its version of the C100’s terrific Accelerate conferences last week and it was a stellar event from beginning to end.
The C100 is a group — or mafia, as they like to call themselves — of mainly Silicon Valley-based Canadian entrepreneurs, venture capitalists and others keen to support Canadian technology companies. Its 48 Hours in the Valley twice a year brings 20 Canadian companies to the mecca of technology for two days of networking, pitches and meetings. For several years now, The C100 has been bringing itself to Canada through Accelerate events, usually day-long conferences. I have been to several Accelerate sessions in Montreal and Toronto over the past few years and have long yammered at Atlee Clark, C100’s chief organiser, that Ottawa needed one of its own.
Read More
