Hey there. This is The Overview, a weekly roundup of noteworthy B2B SaaS stuff. You’ll find interesting thoughts, articles, and more from around the internet.
In this post:
The key to category creation? Aggression.
The first company to reach a prospect frames the buyer’s lens for a long time. The features that matter, the price point and pricing model, insufficiencies in competitors’ offerings. Each subsequent bidder for the business must either conform to that mental model and spar for position within its confines, or exert enough energy and spend enough money to challenge and subvert the first framing. That’s a tall order, and exactly the position a startup should wish upon its competitors
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Each time a customer buys software, it’s color changes and it’s off limits for 3 years. Marketshare in the first 1-3 years dictates marketshare for years 4-6 at least.
The more customers you convert to your company’s color, the stronger the brand, the greater the awareness, the more reference customers, the more capital to raise, the easier to hire and grow. There’s a flywheel spinning in the background that isn’t obvious until the latter stages of category creation. The winner takes most of the spoils.
Tom Tunguz
Once you’ve started to define your new category, you need to be everywhere, do everything, and get in front of every prospect. The money pouring into the startup ecosystem is both a boon and a curse.
Reminder: some products make bad businesses
As much as I dislike Intercom, their blog is one of the best destinations for product management in SaaS. This post looks at the gap between products that make good businesses, and those that should’ve been features instead.
A product needs to meet three tests – desirability, feasibility, and viability – to be in with a chance of becoming a successful business. Some of those problems – in the graph above – just aren’t big enough or frequent enough to cause significant challenges that people will pay to solve.
I’ve written before about value: elements that your customer wants to attain that is useful, worth the effort (of cost, time, or energy), and is a priority. Is your product – and business – delivering true value to your customers?
Build or buy?
This situation is more common in B2B tech than you may think – but it’s not always engineering effort. It might be a finance exec who can build a spreadsheet, or a customer service manager who can fudge multiple products together via Zapier.
I don’t think these situations arise because companies have tight purse strings; instead they have misguided priorities. It’s easier to fix small rocks rather than move the big boulders – this culture prevents focus on solving the big problems with ease, instead bikeshedding1 on less important concerns.
How do you overcome these objections? Provide big enough value, educate the buyer, and make sure you really understand the pros and cons of alternative solutions.
Iteration and embarrassment
If you’re not embarrassed by your work from six months ago, you’re not growing fast enough.
Iteration really is a muscle that has to be trained, just like any other. Reps and sets.
I find this really confusing in startups that iterate really well on their product – only their marketing and sales teams are stuck with behemoth processes from CRM changes to website copy updates. Being comfortable with fast-moving change and then having the tools and capabilities to do so is a completely different story.
Don’t leave user research behind
All companies suffer from this, not just new founders. It’s too easy to focus on short-term growth hacks while ignoring your positioning… and then completely neglecting any type of user research.
As a Virgo, assumptions annoy me – I want to work with insightful facts and concrete evidence. My first post on this newsletter was about how positioning-by-assumption doesn’t work.
User research doesn’t have to be a large-scale project:
Set up win/loss calls
Talk to unaffiliated people in the market
Read customer support requests
Summarise your learnings into weekly or monthly Voice of Customer reports
Simple.
That’s the Overview for this week
Hope you found some interest in this edition.
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Thanks for reading, and happy building.
James