Early this year, I stumbled upon an article written by Jason Fried.
Here it is, "Don't let anyone overpay you": https://m.signalvnoise.com/bigger-prices-bigger-problems-72820249456f
He discusses the value of selling to small companies. He warns about getting tempted by big price tags attached to large company deals, he talks about the benefits of having a large, healthy customer base full of small deals.
I'd been in business about a year at that point, and was just starting to get massive interest from large companies, with huge price tags attached and promises of being very interested. With dollar signs in my eyes, I restructured my business plan around all these beautiful deals and rolled my eyes at the article.
"Silly Jason Fried (who has significantly more business experience than me)," I thought, "I know what I'm doing!"
I'm here to say I'm sorry.
What happened: The vast majority of those big deals haven't put any money in our bank account yet, even almost a year after the fact, even after countless promises of being very interested, even after many more big deals coming our way! It's not because they aren't interested, it's not because the deal won't ever go through, it's just because they're large companies and the sales cycles are LONG. And at the same time, as I begrudging started selling more to small companies out of necessity, I was completely delighted with the results. Small companies were fast. Small companies didn't have a million edits to my legal documents, meaning my legal bills went dramatically down. Small companies didn't have huge corporate politics to consider-- I was often talking directly to the decision maker, and what they said would happen would happen. Small companies didn't try to influence or control product direction. And small companies weren't "lifelines"-- if one deal didn't go through, no big deal.
The sales were easier (even while considering there were more of them!), the costs were lower, the process was faster.
I also took another piece of advice from that article: the implicit warning about how the bigger the price tag, the more process you have to go through at a big company. We're still charging big companies more, but now we're creating more tiers, like paid evaluations, to allow us to get money from big companies faster.
So let this blog post be your notice that if you plan on running a small company too, read Jason's article, consider & absorb the advice.