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/v3-uk/analysis/2005222/how-startups-approach-business
01 Oct 2009, Rosalie Marshall , V3
The question of how startups should approach doing business with larger companies is a difficult one. At recent events for entrepreneurs in London, executives from BSkyB, Huddle and Microsoft, along with Dragons' Den panellist James Caan, shared their views on the subject, and discussed what they look for when approached by startups.
"These are points that need to be thought about, but which may just seem like common sense," said Maz Nadjm, online community product manager at BSkyB, talking at a TechCrunch talk to debate the key trends in the startup scene.
"For example, in talks to discuss investment the first things we look at are performance metrics, like how many clicks have there been on the startup's web site since day one.
"Also the flexibility of the startup's technology. Can they white label, and do they have widgets? It also helps if the technology is transportable. You don't want to acquire a startup that requires a whole new content management system, for example."
Nadjm's other advice to startups included being highly scalable in order to handle unexpected traffic loads. "Think about the cloud, because this allows you to scale up and down," he suggested.
Startups providing community online applications need to consider moderation techniques, according to Nadjm.
"Sky thinks about moderation a lot because we are a family-friendly environment and we need to watch what people say on our forums and networks," he explained. "All video, audio and text needs to be controlled."
Charlie Blake Thomas, commercial director at collaboration firm Huddle, told attendees at Microsoft's BizSpark Summit earlier this week that face-to-face marketing in the early days should be a first priority.
"Get in front of open-minded people and test the proposition with them," he said. "Get feedback."
Thomas advised startups to concentrate in business meetings on how their product brings value, rather than how the technology works, and to "use their language to describe it".
When thinking about sales, Blake Thomas said that chief executives should work out how to sell the product themselves before hiring anyone else to do it. "Define clear stages of the pipeline and process," he said.
Blake Thomas also told startups to "aim high" when approaching big businesses, and to avoid getting "bogged down" with middle management. "Talk to people that have a strategic view and can make decisions," he added.
Bindi Karia, who heads up the BizSpark Accelerator Programme, added to the networking tips offered by Thomas.
"One of the ways to find the right people in the corporate environment is to find other companies that are already engaged with the company, and hear how they first started building relationships," she said.
Karia explained that it is most helpful to her when startups know what they are looking for. "When a startup comes to me and knows what they want to impact in Microsoft, and how they will do this, it makes my job a lot easier," she said.
Karia's advice is not to give up. "A corporate may not be interested immediately, but they could be soon," she said.
For example, Karia mentioned that she did not pay attention to Huddle when she was first approached by the team, but joined the programme later because they dropped in again and left subtle calls.
"After a meeting with a business, it is important to send a follow up email on agreed actions, and then, even if a marketing person does not believe it is a vital investment immediately, they can always look back and find that email at a later date," she said.
Finally, James Caan argued that startups need to invest in their image when pitching to big companies. The serial entrepreneur explained that this is why he got his first address in Mayfair, bought a nice car and wears professional suits.