Last night I watched Dragon's Den on BBC. They had a follow-up on the businesses that the Dragons had decided to invest in and the results were quite interesting.

A large number of the investments fell through after then show (down to due diligence or just simply people falling out) and quite a few of the entrepreneurs were still trading having found funds elsewhere. The Dragon's would insist that they may be trading but were they profitable, and I'm sure they're right in the main part.

Having recently been following a poll on Ecademy, How did you raise the last round of finance for your business? it seems that the majority of startups and growth business (65%) found their funding from friends, family and other sources (which is predominantly self financing). According to the poll, only 7% financed through Angel Investors, and 1% through VC's.

That certainly ties in with my own personal experience and the results of the Dragon's Den.

Many of the clients we work with on sales outsourcing and venturing projects are self financing.

Typically, we work with clients who are looking to expand from an existing (usually low) revenue base and so they want a low cost, shared-risk way of increasing sales. We don't work with everyone; we also have a selection criteria. In many ways we are similar to angel investors.

Maybe I should have called the firm Dragon Associates? ;-)

Labels: entrepreneurs, funding, sales, start-ups, venture capital

I read an article I found on google called Straight to the Outsource.

It covers most of the benefits of using sales outsourcing, such as cost, flexibility and freeing up management time.

One area I don't agree with in the article, is the idea that sales outsourcing is best for small ticket items rather than larger sales. I think that reflects the US sales outsourcing model with is more agency-based (where a sales outsourcing company sells your product alongside complimentary products from non-competing vendors). In that model, the sales team are already calling on your target market so for them it's a simple cross sell.

Our model is more about targeting your market and using our experience to win sales. The difference is that the agency-model is more like a reseller channel. They'll push your product if they can see how it fits with their existing clients.

If you can find partners like that, it's an effective route to market.

We sit in the space where you can't find those partners but you still need a sales effort. In that case, outsourcing your sales through our model has many benefits over hiring your own people, but it is best suited to larger value sales, or to "prime the pump" and win licensing deals that require little or no additional selling (we come in, win the deals and then you scale back to maintenance only)

I'm still working on my article on Sales Outsourcing. Looks like it will be a project to complete over the holidays.

Labels: sales outsourcing

"Don't get mad! Get money!"

That's the credo at the LinkedIn Ventue Capital Group on Yahoo!. I've been lurking there for a few months now and think it's a great forum.

Two of it's moderators, Bineet Ramrakha, and Christian Mayaud offer an experienced perspective from the world of corporate finance and venture capital. Their contributions are always informative and enlightening.

Labels: social networking sites, venture capital

I had to smile when I read an article in trends in Sales Force magazine.

A number of consultancies had published reports on sales force effectiveness. From the results, one message that came out consistantly was how poor sales people were at lead generation and prospecting.

According to Proudfoot Consulting, only 10% of salepeople's time is spent prospecting. And a larger study from CSO Insights showed that there was a 20% increase in firms saying they are "poor or dismal" at lead generation.

The article quotes that "58% of sales leaders say they are poor in defining a prospecting method; only 33% say their reps are making enough calls".

Em...excuse me, perhaps they should be talking to us about our services ;-)

Labels: sales lead generation

I've been re-reading "Go To Market Strategy" by Lawrence G. Friedman and I'd forgotten what an excellent book it is.

It really is one of those "the title says it all" books and to my mind is essential for anyone launching a new product or service.

The section on "the ten commandments of going to market" is a classic. The book sets out the concept of "channels" really clearly and, re-reading it again, gave me additional thought on the value of sales outsourcing.

So much so, it's inspired me to write a report explaining how sales outsourcing can be used effectively as a go to market strategy for startups and growth businesses.

Watch this space.

Labels: sales outsourcing, strategy