Part and parcel of every entrepreneur and their business, is Biz Dev. Biz Dev, for those who are not familiar with it, essentially is creating growth opportunities for your business. Within the business itself and between your business and other relevant businesses, growth opportunities can even become growth hacking. The simplest way that pops into mind is through partnerships with other businesses.
The question is, how to start?
This a tricky angle to tackle for most startups. And for more established companies, in the sense that, they need to find more dynamic and relevant biz dev. models.
One of the key parts in business development is, without a doubt, sales. When any great and effective effort at business development is due, it will be accomplished from fantastic sales-(wo)manship. You need to have the ability to sell your product, and a fervent belief in your product and its capability.
Your product or service must be able to solve the pain-points in the market that it wishes to serve. This aspect of being a salesperson in business development is grossly underrated and underrepresented. On top of that, you need to be able to understand what people like, how they would want to see something done, and how to bring across how your product is different and better than something else your potential customer has seen.
My boss at my first venture capital internship told me about the importance of presentation when selling (in lieu of growing/developing the business). He used the example of a person that you generally do not find attractive, at least facially, and them dressing up very well. Well enough to augment their best features for which you would give way to, regardless of the fact that you are not genuinely attracted to them. “If they wore great fitting pants, and a flattering top, you would go for them, right?”
“Yeah, I would. I won’t lie.”
It’s funny, a guest that we once had at Startup Grind Cape Town, Sheraan Amod, who sold the company, Personera, also said something similar in his talk. In lieu of attracting investors to his company and growing it, he spoke about a sales course that he went to while visiting in the states. In this sales course he was able to understand how to get better at sales in general.
"You can deal with a pig if the pig looks and smells good."
He spoke about a having a pig, but perfuming the pig and putting a makeup on it, in order to make it look and smell good. It is still a pig, but at least it’s an attractive pig. “You have to tell the truth. But you can manage the truth, as well.” he quipped.
I can take a bet with anyone in the world that, investors and/or customers would rather buy from an attractive pig than from a dirty, plain or plainly dressed pig.
You will also buy from an attractive pig, rather than a dirty, plain, or plainly dressed pig.
As entrepreneur, when developing your business, you have to put yourself in the eyes of a customer, or if you’re looking for partnerships, other relevant businesses. What is it about your product or service that will be of value to somebody else? Is it because it will change the way the customer does things, or is it because advertising your beer on a beer company’s blog will give them a bit of revenue, and variety in the content that they put out?
You need to ask and answer your own questions -- a lot of them.
The key to developing one’s business is the value that you and your product or service can bring to someone else. If you have a tech company that produces ecards, identical to majority of those on the ecards market, you are probably not going to get very far. Your product or service will need to have a differentiator.
If you sell ecards that constantly pop up in the morning as a greeting whenever you open your laptop, and they give you free data, then you are onto something. Something great that fills a need -- then developing your business will be easier. In the latter example, these are still ecards, but yours will be more attractive and more fun to play with.
Dave Goldberg (Rest in Peace, Dave).
Working in Sales at the beginning of his career, Dave Goldberg (Rest in Peace), spoke about the value of learning how to be a good salesperson. He sold sneakers, and held a number of senior positions at Best Buy because he was such a fantastic salesperson.
[Editor note here: Dave, truly one of the great's, is so worth listening to. Maybe because he is gone now -- and maybe just because he was so amazing.
My son, John Rampton, who was there the night of this Startup Grind event, called and told me to get hold of this vid. John said that Dave is one of those people who there was an instant connection with and that Dave Goldberg is (and was) the finest human being he had ever met. He mentored my son, and for that I say, "Thank you, Dave!"] dr
What happens with the wrong focus?
Also, there seems to be a trend in venture capital these days, of entrepreneurs targeting the wrong focal points when trying to develop their businesses.
MVP -- don't ask for money without it.
Many entrepreneurs have the idea that investors will be impressed by ideas and they hold on to them like they are a golden nugget. Companies need to begin with a minimum viable product. Granted, there are some investors who thrive on products that are in the idea stage -- but very few investors will work with companies that have anything less than the minimum viable product stage. Startup investors need to see traction and production.
They way to traction.
The way to the yellow brick road or traction is you also sell your product to enough customers to gain that traction. You do business development by providing value to other businesses enough, to get a small amount of decent traction.
If you’re a business selling sneakers online, you can send a pair of sneakers to every famous sneaker blogger or sneaker store in your area or country. It would be advisable to send a pair of sneakers to venture capitalists or a pair of sneakers to your favorite technologists. Do you have an engineer mate from back in your college (university) days? Yeah, he may have some great helps for you if you send him/her a pair of your sneakers, too.
Where do we go from here?
From there, you can go around to local schools or local shoe shops, drop off a pair or two (after striking a juicy commission) with the store owner and gain traction. One of the co-founders of Uber did business development by hiring some of his friends’ cars and using them as the first Ubers. The product could gain some traction because of this help from his friends. He also made deals with other car dealers to lease cars from them, in exchange for traction on Uber.
Business development done will is an amazing tool.
All in all, biz dev. done properly is quite an amazing tool to the business. In order to do good business development, you have to be good with people. You have to be able to envisage what they would like, and you have to be able to hear what they are telling you that they would like. You have to take what they have said and extract the value, put in your expertise, and provide them with what they are asking for.
When you present to investors it is especially important to be able to explain what you have done in this step. Business development, whether from startup to startup, or entrepreneur to investor, is all about presentation, people skills and value creation from information. Iteration on the original over and over.
Sheeran Amod -- The really good stuff starts at 41:48 on the vid.
Dave Goldberg -- The really good stuff starts about 5:00 on the vid.