It’s Hard to Build a Big Business Out of Small Deals

Small Deals To Get Started – Big Deals To Grow

in this next “From Impossible” excerpt, you’ll see that you can make millions without millions of users…

Many entrepreneurs, especially first-time founders, have expectations of what people will pay that are far too low. It’s also easy for experienced executives to fall into a rut with a division or team, either through inertia or habits. Push yourself past those limits, to come up with ways to double or triple your revenue per customer by also asking: What would it take to grow our revenue by 10x? What would it take to grow our biggest sales size by 10x? How can we find and work with customers to whom our solution would be worth 10x the price we’re currently charging?

What We Love and Hate About Small Deals

When most people start a business, we all want to get whatever customers we can. This usually means smaller deals, often from “free” to a few thousand dollars. “Small” is a great place to start because it’s easier to get things going and adjust on the fly. Plus you can get valuable feedback, case studies and community effects from small customers.

Also, smaller businesses can be more disorganized or less sure about their planning; just trying to survive rather than grow, can’t afford to pay much, can’t pay cash up front, may buy impulsively, or lack the time, people or money to follow through 100%. Smaller businesses are wonderful and the backbone of our economy, but don’t count on making a big business out of small deals.

What We Love About Big Deals

One of the best ways to double up on top of your other growth, and without working more hours, is by closing bigger deals. With bigger deals, you’ll:

(a) make a lot more money
(b) exert less effort and
(c) help customers become more successful

If you’re selling to someone who’s close to your Ideal Customer Profile, closing a $100,000 deal shouldn’t be much more work than closing a $10,000 deal, and may not even take longer.

So if it takes 2 to 3x the time and effort – but you get 10x the revenue and your customers get 10x the value – it’s worth it!

Don’t be afraid of raising your prices when selling to bigger companies with bigger needs. Bigger deals can take longer to close, but they’re worth the wait because:

Better service: You can focus customer service/customer success people on fewer customers, ensuring customers get the most value from your product.

More commitment: As long as you’re not selling to people who aren’t a fit or aren’t ready, bigger deals should lead to companies that have more necessity, commitment and resources to get the most from your product.
More cash upfront: Working with bigger deals often means working with companies that have cash or funding, to pay cash-up-front for 1 to 3 year contracts.

The Best of Both Worlds

We want to be clear: we’re not telling you to give up small deals. Use small deals to get started, and appreciate those customers and love them – but don’t limit yourself to small deals by thinking small. Before the Internet, businesses ended up focusing either on lots of small, transactional customers oron big customers and big deals. Now, companies can blend them cooperatively, building a customer base of small, medium and large customers. The trick is focusing on one as your primary business, while keeping the other(s) as complementary.

we hope you enjoyed this From Impossible To Inevitable excerpt!