I'm starting a new business called Kynetx. As I go through some of the things I do, I'm planning to blog them. The whole series will be here. This is the nineteenth installment. You may find my efforts instructive. Or you may know a better way--if so, please let me know!
I have a theory that the third deal matters more than the first two. Here's why.
The first time you sell your product--your first deal--is always exciting. But let's be honest, it could be a fluke. If you beat the bushes long enough you're likely to find someone who'll buy almost anything.
The second deal feels good because you at least can convince yourself that the first deal wasn't an accident.
But the third time you sell your product you have confidence around a few important things:
- Proven repeatability - to get to the third deal you've proven that you understand what your selling and you're able to explain it in a way that people connect with.
- Turn the crank - at this point you ought to be able to "turn the crank" operationally and deliver. If you're still doing one-offs by the third deal, you need to ask yourself what will change by the fourth, eighth or 100th deal? You can't achieve scale without operational excellence.
- Know your price - On the first deal you're always a little unsure of the price you've set. Is it too high? Too low? Will you get laughed out of the room? By the third deal, you can go into pricing discussions with confidence. After all, two other customers have paid it--why won't everyone?
I've found that to get any deal you usually have to put your ego aside. The sweetspot is when you've found (a) something you're good at, (b) something you like to do, and (c) something someone will pay for. A deal implies (a) and (c). If you have to cave at all on (b), then your ego's likely to get in the way of the deal.
Putting ego aside is not always easy for techies to do. After all, you've spent years working on this and generally have dreams and even fantasies about how people will use it. Take a deep breath and realize: someone's willing to pay money for something you built. That's a good feeling. Go with it and enjoy the ride.