Challenges in dealing with large companies- How you make it happen. Sanjay Swamy of AngelPrime (and earlier, mChek) shares some great insights.

1. DOING BUSINESS
WITH LARGE
COMPANIES
@theswamy
@angelprimeone

2. Challenges in dealing with large
companies
They don’t appreciate what I’ve done
• I can’t find the right person in the organization
• They just don’t get it -I have to keep running behind them
• I keep travelling to Mumbai & Delhi – I can’t afford this
Complex sales cycle & terms
• They want a free pilot
• They want exclusivity – without commitments
• They want to brand it with their own name and sell it
They don’t trust me
• They want me to have 10 customers
• They want me to have 2 crores of existing revenue
• They want my source code
They are a pain to deal with
• They never pay on time
• It’s a long sales cycle
• They suddenly want to roll it out to 1000 field offices

3. Challenges in dealing with Small
Companies
My business needs are unique!
• Startups provide simplistic solutions – no knowledge of our business
• Small companies don’t follow-up in a professional manner
• I have an approved vendor list
Neat stuff but…
• Their pricing model is unacceptable
• I don’t want to pay to build their brand
• What if this becomes big and I ignore it
Who are these guys?
• Will they be around? What if they go out of business?
• How can I trust them with my customer data?
• Assuming it works - can they scale to my 1000 field offices?

4. And Yet
• Large Companies routinely do business
with Small Companies very successfully
• Small Companies do successful on the
back of Large Companies
How does this happen – is there a
magic formula?

5. Most definitely YES!
• You have to systematically address
their perceived concerns
• Deal with the Egos a little bit!
• Because when you make it work –
the pot of gold could be significant!

6. First ask yourself…
Do I really need the
large company as
my customer to
launch?
Am I providing
them a service or a
product?
Is my product going
to create a revenue
stream/differentiator
for them?
Is the product
adding to their top
line or bottom line
or both?
What do I have that
is unique? No, its
not price!

7. Let’s discuss some key topics
• When & Who
• Pricing & Exclusivity
• Payments & Support
• Newer approaches

8. When & Who?
Find an upcoming star in the company
• MUST be excited by what you are doing
• Strong desire to make his mark internally
• Company with a reputation and track record of innovating
Get them involved VERY early
• They must feel the ownership
• They must be willing to stick their necks out for you
• Get them to sign an NDA very early – why?
Get to a quick pilot launch
• If someone wants you to build the perfect product, you’re dealing with the wrong person
• Has to be a paid pilot
Make someone a hero – win their trust!
• Its all about Ownership & Success! - don’t try to be sly and take all the credit
• Don’t talk to the press about what you are doing
• Don’t rush to other customers – but have a plan B

9. The Pricing/Exclusivity Challenge
Free & Exclusive
• I’m your first customer – helping define the product
• I’m giving you access to my customers
• I don’t want you to work with my competition
Establish your point of view early
•
•
•
•
Your success is important to them
You are flexible about pricing but deserve fair value
You’re open to discovering fair value
Exclusivity is a two way street – what are you doing for me and
how do we measure it
• Be transparent with them – blame your board
It has to be a partnership
• I’ll give you a great deal no doubt – but it won’t be free since I
need to pay the bills - let me see what best I can do recognizing
that you are really a partner more than a customer

10. But will you be around?
Have a clear plan on how you will capitalize the
company
• I will do XYZ, then raise capital
• I have investors ready to fund me – but I’m waiting until we can
validate a few things with you
What if my competitor buys you out?
• Source code escrow arrangement
• Support obligations
Never accept a Right of First Refusal on your
contract
• Nobody will buy you!

11. Payments & Collections
Paid pilot – establishes the payment cycle
• Proof that you have the right champion
Establish the collections process early
• Send the first invoice on time, even if for Rs. 100
Meet the purchasing guy early
• Don’t wait expecting your business guy to work it outt
Upfront payment that is adjusted towards future
services

12. New Media & Approaches
Leverage LinkedIn & Twitter
• Find the right people
• Research your customer well
• Find the right person in the organization
Consumerization of the
enterprise
• Launch products that people use
• Works mostly for tools
• Free trials – Fremium models

13. Questions?