How Taking Non Scalable Actions Can Get Your Startup Off The Ground

“Hey, hey!” Our VP of Sales yelled across the office to me. He was excitedly running around the office. We had done a “soft launch” of our first product the day before. Our VP of Sales was celebrating because we received our first order.

What was the amount of that first order? $13.

Now, I’m going to let you in on a secret. There are only two people in the world that know this secret, and now you are the third.

I had asked a friend at another company to buy the parts. So, I was using my network to help generate some sales and momentum. Now, why would I do something like this?

I just wanted to prime the pump.

And priming the pump is what the early selling days are all about when you are starting your company.

When you’re starting out, you quickly realize (unless you get really lucky) that customers don’t come banging at your doorstep for your products. No one knows you exist!

I think that lack of brand recognition was what surprised me the most when we were starting. The crazy thing was I knew we weren’t going to have any brand recognition before we started. Yet the lack of brand recognition still startled me.

However, it’s one thing to know you’re not going to have any brand recognition, it’s another thing to experience not having any brand recognition.

No one knows who you are when you are just starting out. No one cares that you worked at Google or Facebook anymore.

You’re at the bottom. And, you’ve got a long, long climb back to the top.

Worse yet, you also quickly realize that the sales tactics you might use at a large company such as having a large, experienced sales force at your fingertips are not available. You don’t have the money (or the reputation yet) to hire good sales people, and you will not for a long time.

Think about the situation you are when you start selling your first product. You have:

  • No brand recognition so customers don’t know who you are, and…
  • You have no money or a very limited amount of money to spend on sales and marketing, and…
  • Your product may be only slightly better than the competition

Overcoming one barrier to selling is tough enough. How are you supposed to overcome three barriers?

So what do you do?

You take non scalable actions to grow your business.

For example, the CEO of a company I work with is generating nearly all of the early revenue for his company by going to meetups. It’s an unbelievably inefficient use of his time, and there’s no way he can scale his company by going to meetups.

However, he can get a base of revenue by going to meetups. So, this CEO goes to meetups and he keeps landing customers.

The amazing power of taking non scalable actions.

The great thing about using meetups as his initial sales channel is there is no competition. His larger competitors aren’t going to these meetups, so he’s got the whole channel to himself.

It’s clear to the CEO that he can’t keep generating all his revenue from meetups forever. However, the meetups are giving him a very healthy base of revenue that he will be able to leverage.

Plus, there’s a huge benefits for the CEO to be doing the selling early on:

  • The CEO will know the company’s customers inside and out, and…
  • The CEO will know what works selling to customers, and what doesn’t work first hand with no filtering, and…
  • The knowledge the CEO gains working directly with customers will help the CEO when he hires a really good VP of Sales down the road.

Taking non scalable actions can be the difference between success and failure for your startup.

Think about the world before your company existed. Somehow or other the world got along quite well without your company.

And, yes, you’ve got a great product that is 10X better then anything else out there. And, yes, being 10X better will certainly help you rise above the noise. However, being 10X better will not be enough.

Rising above the noise is where taking non-scalable actions comes in.

Non scalable actions start with finding an unused channel and personally going door to door (or to meetups) to close deals. But closing the deal is just the start of the non scalable action.

The next non scalable action is overwhelming your customers with support.

You may be a small company, and maybe your product still has some bugs. However, you can make the experience of using your product incredibly positive for your customers by overwhelming them with support.

There’s no better example then Zappos.

My goodness, Zappos was just selling shoes! Shoes that you could buy anywhere! Yet, Zappos went on to be an unbelievable success story (bought by Amazon for $1.2B) by differentiating through unbelievable customer support.

Zappos didn’t give their customer service people scripts like every other company. Instead, Zappos’ one rule was making sure that every customer was satisfied. If it took a one-hour phone call to satisfy a customer, then so be it.

Sometimes you learn that the non scalable becomes scalable.

That’s certainly what happened with Zappos. You would have thought that there’s no way a company could have it’s customer service people spend an unlimited amount of time with every customer that calls. At some point, the system would change and they’d become like every other company.

Yet, Zappos never changed. Zappos continues encouraging its customer service people to take as long as needed to satisfy every customer.

What Zappos realized is that while they may spend more time up front with customers, these same customers will be customers for life.

“I think the main thing is just trust [the customer service reps] and let them make their own decisions. Most call centers are set up by policies and so the actual person that’s answering the phone doesn’t really have the ability to do anything. If you…call most customer service places, if you ask for anything that’s not normal they have to talk to a supervisor or just say ‘oh our policy doesn’t allow that’ and whatever. So we generally try to stay away from policies, we just ask our reps to do whatever they feel is the right thing to do for the customer and the company. And that’s actually really uncomfortable for a lot of reps that come from other call centers. We kind of have to untrain their bad habits.” Tony Hsieh, CEO Zappos

Non scalable actions are not just sales related

Maybe the non scalable actions are how you manufacture your product? Maybe the non scalable actions you take are around the accounting system you use? Or both?

For example, we had a big debate about the inventory management system(s) we should use starting out. The VP of Operations and VP of Sales wanted to use an expensive $300,000 system. I wanted to use the more difficult to use combination of Quickbooks and Excel.

We decided to that using the combination of Quickbooks and Excel was the right way to go. We would save nearly $300,000 and we would learn exactly what we needed when we wanted to upgrade to a more expensive solution.

The combination of Quickbooks and Excel turned out to be the right decision. Manufacturing ran very efficiently, and we did learn exactly what we needed when we were ready to upgrade.

And, interestingly enough, the combination of Quickbooks and Excel worked much longer then we thought. Yet again, the non-scalable became scalable.

What non scalable actions are you going to take?

You can see from the examples above that are many ways you can utilize non-scalable actions in your journey of building your company. So, ask yourself about what non scalable actions should you be taking right now?

Are there non-scalable actions you can take in sales? Are the non scalable actions you can take in marketing? What about non scalable engineering or manufacturing?

So start taking some non scalable actions today and watch your company scale Mount Everest.

Written by

I work with startup CEOs to help them grow their businesses . I built several businesses from $0 to >$100M. Learn more at www.brettjfox.com

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