On a recent Twitter Space, M13 partner Anna Barber and I looked back at the dotcom crash in search of lessons operators can use to avoid missteps founders made in past recessions.
In our chat, Barber talked about how founders can better align with investors and employees while coping with uncertainty, the dangers of growing too fast, and the economic, social and emotional consequences that come when so many companies close their doors at once.
Many entrepreneurs have been encouraged to believe that smooth storytelling and good interpersonal skills are enough to convince investors that things are going according to plan. They are wrong.
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Rather than instinctively go into survival mode, she said founders should ask themselves existential questions like, “Why did you start this company? What are the fundamentals? Who are your customers? What problem are you solving?”
“At a time like this, trust is more important than ever,” says Barber, adding that she instructs entrepreneurs to stay in close touch, “especially with bad news.”
Before problems arise and between regularly scheduled meetings, entrepreneurs should become familiar with asking for help and advice. Reaching out to share an update or ask questions sends a strong signal that you don’t wait for someone to give you directions.
‘Tell them what you need. This is what we’re here for: to roll up our sleeves and solve problems with you. Nobody expects this to go smoothly,” Barber said.
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Use predictive marketing to lower the CAC at your PLG B2B startup
Startups targeting business customers are in an awkward position: new users won’t turn into paying customers for weeks.
As a result, marketers tend to make reflexive decisions too early in ad campaigns because they don’t have enough data.
Rather than using “early return on ad spend (CAC or ROAS) metrics that rely on historical averages,” contributor Ido Wiesenberg created a simulator that allows teams to estimate “the probability that a campaign will evolve over time.” can yield a high ROAS simply by entering a pair. Numbers.”
3 Ways to Implement a Product-Driven Sales Movement to Unleash PLG’s Revenue Potential
Robust product-driven growth strategies rely on customers to drive growth and acquisition, but “the traditional top-down enterprise sales model just doesn’t work with PLG’s self-service, freemium user base,” writes Stephen Moock, head of sales and success at GTM platform. Calixa.
Sharing consolidated user data with product and sales teams will reveal patterns and insights that help identify product-qualified leads that are more likely to convert.
To take advantage of this, sales teams need to ‘recalibrate’ their approach.
According to Moock, “Your free offering and the features customers get when they upgrade to paid plans should create a natural conversion path to your business offering.”
These are the industries ripe for innovation under the Inflation Reduction Act
The Inflation Reduction Act is the most comprehensive climate legislation the US has ever passed, and according to climate reporter Tim De Chant, entrepreneurs are already expressing “optimism and confidence.”
Looking at industries as far afield as EVs, real estate technology and CRM software, Tim spoke with the founders about the potential effects and benefits of the new law, which includes $433 billion in new investments and $739 billion in compensation.
“Established companies and later-stage startups are likely to have the most immediate impact,” he reports.
“From this year and next, property owners will have access to a range of tax benefits that will help them electrify buildings and improve their energy efficiency.”
The case for US venture capital outperformance
A land war in Europe, cautious action by the US Federal Reserve and ongoing supply chain shocks are just some of the many factors driving instability in global stock markets. But some analysts are still optimistic.
According to John Zik and Shachi Shah of EQUIAM, a late-stage VC fund, “the story of the technology and innovation supercycle remains unchanged and many companies are poised for growth.”
Looking ahead to the next 6-12 months, the duo identified “two different potential outcomes for the US private technology sector:”
- Scenario 1: Extra Pain for Recovery
- Scenario 2: Broad economic upturn