Understanding Reasons Behind Massive Failure of High Tech Entrepreneur Startups
It is far from easy to start tech company. There is a lot that is involved in this competitive market for a tech company to start and survive in business.It is needful to ensure that you come up with appropriate services and quality products to attract and maintain the right size of clientele.Many types of marketing have been used over the years by companies so at to attract customers.Included among these are include radio, newspapers, television, and among others.
It is known by many that it takes longer than expected to start hi-tech companies. Tech companies cost more than anticipated. Panning out for venture capital investments is scarcely achieved by 80% of all venture capital investments. The Sales Learning Curve is required by tech entrepreneurs to make it in the industry.
The margin of contribution per Sales Yield gauged against the all customer transactions is what the sales learning curve will track.Different tech companies exhibit peculiar shape of the curve. There is an imminent need for tech companies to go slow before they enter the market.This is a strategy that is practiced by many in diverse industries. The confines under which the Sales Learning Curve are in the go-slow fast before entering the market.
When sales reps meet face to face with customers and close initial sales, there is an organizational learning that takes place. This happens to be a very crucial requirement for the success of the organization. There will be a complete hiring of VPs as long as there is a completion of the beta product. This strategy fails most of the time.The reason for this is lack of investing time in understanding the SLC shape for its product in the market.
Everyone will see a consistent pattern of highly inflated B round valuations in the tech startup entrepreneurship industry. A worthwhile note is that the down rounds for C percentage and later rounds is greater than B rounds. This effectively displays how the ignorant the entrepreneurs and VC’s are in considering the cost and time needed for moving up the SLC after completing the Beta product. They fail to understand that company is now ready to commence the SLC learning process but not likely to immediately gain market traction forthwith. This is a hard to process to determine the time to take.It may sometimes take longer for some entrepreneurs.
You will only need to hire few technically savvy sales reps as you move from beta release to first release. This will be conduits between initial customers and the tech team compensated on the organizational learnings.
