Whale Hunting: How to Sell Software to Big Companies
In his timeless Moby Dick Theory of Big Companies, Marc Andreessen laid out the idiosyncratic buying process at massive corporations, and how he believes startups should handle them: with extreme caution. Big companies, Andreessen argued, come with difficult, lengthy, and unpredictable sales cycles. As customers, they can be distracting, expensive to maintain, and of course, pose a large business risk if they decide to take their business elsewhere. Andreessen’s assessment could best be described as skeptical:
A big company might study you for three months, then approach you and tell you they want to invest in you or partner with you or buy you, then vanish for six months, then come out with a directly competitive product that kills you, or alternately acquire you and make you and your whole team rich.
And you’re never going to know why.
While I completely agree that large companies are difficult and often unpredictable, I don’t agree that the best strategy, as Andreessen seems to suggest, is to hang on for dear life and expect to be a passenger in the buying cycle. True, you’ll never completely understand the decision making process at a Whale, but you can at least attempt to position yourself favorably to overcome it. In my market research interviews with buyers at Fortune 100 companies and the salespeople who deal with them, certain patterns have emerged about how these organizations operate and strategies for penetrating them. Here are four strategies that should help you sell software to Whales:
Cultivate an Internal Salesperson
If there’s one constant at Whales, it’s that decisions are never made by just one person. Whoever the point person is in the sales process, winning them over is just the first step. Your next challenge is to train them to do your job: they’ll need to get their peers and superiors excited about the product and handle objections that they might bring up. In order to keep their internal sales pitch closely in line with yours, make sure they have ample supporting materials when their own knowledge or persuasive powers come up short. Additionally, try to keep them in the loop on the hurdles they’re facing, and consider stepping in and contacting one of their colleagues directly if you don’t think they’re capturing the value of your product correctly.
Big Companies are Reactive – Talk about their Competition
Andreessen hit the nail on the head with this one: a near-universal characteristic of large companies is their risk-aversion. They’ve got a good thing going, so they don’t like to rock the boat with a new, unproven product. More so than smaller companies, they want to hear about all the other Whales that love your software. Cultivating referral relationships and getting case studies from your big customers, even if you only have one or two, is absolutely essential to winning over more big companies.
If you’re selling to a smaller company, a pitch can center around the features, ease of use, or how your product fits into the strategic direction of the company. Big public companies, on the other hand, are hyper-focused on their bottom line. Because the decision maker is likely several levels removed from the actual software, a user-centric pitch that emphasizes the features or usability likely won’t get much traction. Make sure to emphasize the monetary impact of your product, this will give it the legs to move up through the organization.
At a smaller company, the decision maker on a given topic is generally pretty clear cut, and if they give you a flat-out no, you can probably take their word for it. At larger companies, “no” often just means you’re speaking to the wrong person. Perhaps your product doesn’t fit their job description. Perhaps they’re too high in the organization to see the value in your software’s features. Perhaps they don’t have the authority to buy your product, and they don’t have a good relationship with the person that does. You may have to reach out to multiple people within the organization before finding the one who both sees the value of your product and has the authority to buy it.
Hey, nobody said it would be easy. But like Andreessen said, there’s potentially a lot of Whale meat in it for you if you succeed.