On 27 Jan, we hosted a webinar together with IMDA. This webinar was the first of a 6-part series of webinars held over Zoom that Qualgro and IMDA will be hosting together. Through our interactions with start-ups in the industry across different markets, we launched a series of webinars that will cater to common start-up pain points or difficulties most start-ups will face. Through this series of webinars, we hope to provide deeper and more tailored content that start-ups in this landscape really need.
The idea of pitching and partnering with corporates and governments could be daunting to most startups, but if executed well, could result in a win-win situation for all parties involved. Corporates and governments look to startups for innovation and agility, while a successful partnership with a corporate or government could mean the world of difference to a startup’s branding and runway. In this session, we talked to Sudhanshu Ahuja (CEO, impress.ai), Peter Huynh (Partner, Qualgro), Mohamed Hardi (Director & CIO, Leading Digitalisation & Transformation, National Heritage Board), Munfai Choo (Senior Manager, Digital Innovation, Singapore Airlines), and Katrina Too (Programs and Partnerships, Global Digital Talent Network, Alibaba).
You can find the video recording here.
Here are some key takeaways and insights from our panellists:
The Value of Working with Start-ups
Many corporate and government organisations have started working with startups in recent years. Munfai spoke about how Singapore Airlines (SIA) has been partnering with start-ups to develop new ideas through their Digital Innovation Lab, KrisLab. Mohamed Hardi also added that the National Heritage Board (NHB) has been working closely with the vibrant start-up community to curate “phygital” experiences for Singapore’s museums and heritage institutions. Since the pandemic, the need to explore new digital means for visitors has also become more critical. “Start-ups community is a source of ideas and talent pool, and working with them is a way to turbocharge the industry,” Hardi said.
The Playbook of Successful B2B Start-ups
As a venture capitalist specialized in B2B SaaS startups, Peter noted that the most successful B2B startups are the ones that can successfully connect with C-suite executives. He cited an example of DataRepublic – one of Qualgro’s portfolio companies. The company provides solutions that enable data governance and data sharing between large enterprises. When such a solution is in a space of high priority, the sales process is often top-down, therefore it is important to have experienced people in the team to form those relationships with the top management. He added that most of these startups have a clear playbook in terms of vision and best practices hence attracting the corporates to work with them. “The ability to work with implementation partners in terms of distribution is very important as well,” he added.
Approaching the Corporates and Governments
Sudhanshu shared with the audience his journey in getting his first corporate client – DBS Bank. He explained it all began with a friend at DBS Bank, who out of ‘paying it forward,’ gave a shining introduction to several influential people at the firm. From there, they were able to build the trust and credibility going forward. He emphasized that trust and credibility has to be built on an ongoing basis as there will be contract renewals and even referrals in the long run.
On this point, Munfai also echoed that building trust and credibility is crucial when it comes to working with corporates and government. To build those, startups require three ‘E’s – Experience, Expectation and Execution. The team needs to have experience in scaling up businesses, manage the expectations of corporates and execute as promised.
Another approach mentioned by Hardi was the ability to be agile and do things in bit-sizes. Corporates and governments often need startups to be able to quantify their benefits hence running a pilot project and show the ability to scale thereafter is important. Rather than competing on a tender with 10 other competitors, it is much easier for startups to approach such organisations latterly.
The Potential Pitfalls for B2B Startups
One of the most common pitfalls mentioned by Peter was truly understanding signals from noise. In the B2B space, the sample market size is relatively smaller hence it is difficult to differentiate the market needs vis-à-vis the customer’s specific needs. Startups then made the mistake of modifying their product roadmap to fit into a particular customer need. Peter advised start-ups to understand their vision and stick to it while building products that are beneficial and relevant for the customers in the long run.
On this point, Sudhanshu advised startups to stay vigilant in acceding to customer constant modification requests. After achieving a certain level of product-market fit and customer satisfaction, it’s critical to start pushing back on custom requests which don’t fit into the roadmap. He added that management needs to empower the sales team with tools and playbooks to incentivise customers to be more self-service. Ultimately, a company wants to achieve a state where the product roadmap has a greater influence on the output of the product team than customer’s custom requests.
Another common mistake brought up by Munfai was the use of a standardized sales pitch. “Some start-ups did not connect the dots between the products they offered and what the corporations needed”, he added. Munfai advised that startups should not expect corporates to understand where their products fit and instead tailor the sales pitch specifically to the corporate needs.
Most importantly, Peter mentioned most startups failed to anticipate the need to be enterprise-ready. To be enterprise-ready refers to being compliant with ISO standards, audited for cybersecurity, insured for procurement processes, etc. He cautioned startups that there is no point selling into larger organisations that cannot buy from you. “Decide if the sales engagement is getting too long and better to come back again when you are more ready, particularly when you are short on the runway.”, he added.
Sudhanshu also echoed the importance of being enterprise-ready. Impress.ai has spent 20% of its seed funding into getting the company to be enterprise-ready. After building that foundation of readiness in their early stages, he saw the sales cycle of his company shortened by at least 30%. “When it comes to compliance and security, it is the basis of the deal”, he emphasized.