IntroductionIn the third installment of Wonderflow’s interview series, we talked to Nelly Bonfiglio, Head of Sales at Groupon. She is a sales expert with extensive experience working for large enterprises and startups. As explained in the interview, she helped the Italian startup Easy Welfare grow and reach a €53M acquisition, helping to shape the business and the teams. We talk about how startups and enterprises should leverage market feedback in their business strategy.
Working at a startupHi Nelly, and welcome! You have a very interesting track record. Do you have any tips for people who are working at a startup or are considering working for one, specifically on the commercial side?
I think there are four important factors to consider if you work in a startup environment.
The first one is: don’t be afraid to change. During my time at Easy Welfare, we changed the business model so many times. In the beginning, we were a consultancy company, after three years we became a services company, and after three more years we transformed our business once more, becoming a product company, based on a SaaS model. So, it’s really important to not be afraid of change, because, if you don’t adapt, you risk missing opportunities.
The second one is: build an agile and long-term sales strategy. You have to create a long-term strategy for a long-term period, but you need to be flexible and adaptable to be able to adjust to the needs of the market. Let me give you some examples. In my years as the CCO of Easy Welfare, I changed the structure of the sales team and sales strategy by following the needs of the market. For example, setting a lead generation function to help the sales department to work in an inbound way. Easy Welfare’s sales team started with seven people and expanded to thirty people.
Additionally, the structure of the team was changed over time.
For example, by introducing commercial KPIs to assign the same opportunities to everyone in the sales team, and developing the marketing department to assist the lead generational function and capture every market opportunity. Therefore, it is essential to define the strategy and be adaptable year by year, following the changes in the market. The third one is: reinforcing middle management. If you’re a startup, it is fundamental to have a strong top management team, but the middle management is also really important. When the top management is involved in understanding the changes of the market and consequently changing the company’s strategy, you need a highly functional middle management to manage operations and to understand the market changes from the field, consequently adjusting the business model.
And finally, the fourth one is: creating a collaborative environment. This is important because, when you are a startup and you need to grow quickly, you are sales and revenue-driven. But collaboration with other departments is extremely valuable. For instance, if you develop a tech product, the collaboration with other departments such as IT, operations and marketing, is fundamental. By collaborating with other departments, it is possible to avoid the risk of following the market too much and miss opportunities. At Easy Welfare, we organized quarterly meetings with the middle manager of each function to share practices and changes. You started with a smaller team and you grew that along the way. Do you have any example of the insights you got from doing the sales call and working with your sales team? As you said, you need to work with middle management to get market feedback and be on top of the market. Do you have any example of a shift that you had to go through based on market feedback?
Yes, of course. The feedback from the market, from your trusted clients, and your potential ones is very important. I remember when we started developing Easy Welfare’s platform and we didn’t have many features in it. It was really important to start a trusted conversation with our clients, to better understand their needs and to develop the product together. If you don’t talk to your clients, you miss the opportunity to better understand what their needs are and you risk developing a product that does not fit their needs. So, it is a real risk. Also due to the fact that you’re a startup and your funds are limited. For example, a lot of our most important features have been developed together with our clients and, sometimes, we closed agreements with them to develop some features together. I think this is a common trend right now, it’s called “open innovation”. Learn more about startup and enterprise collaboration.
A lot of big companies prefer working with startups to develop products together, exploiting their flexibility, vertical knowledge and expertise.Over the years, I’ve encountered quite a few startups who have a sense that they don’t need to change, as there’s a sense that they are doing it right already. “Our product or service is so good, we don’t need to change, the market will accept it”. Did you ever feel resistance in suggesting changes, and if you did, how do you work with that?
This is an interesting question. I think it is really important not to assume that your product is perfect, to talk about what you’re doing and to share your doubts about your product. Quoting the CEO of Easy Welfare: “It is worse not to talk about your product and keep its secrets than to show vulnerability and talk to your clients to understand what opportunities are out there”. Many of the mistakes that startups do are related to the fact that they prefer preserving their secrets about the products. They prefer working alone, in a monopolistic way. However, in reality, if, as a startup, you want to become a scale-up, you need to talk to your customers. You need to talk to everyone! It’s an opportunity. At Easy Welfare, we always talked about our product. The competition arrived shortly after, and it was an opportunity to grow faster and faster. Also, we closed some agreements with companies from the competition to discuss with public institutions, to grow our businesses.
The importance of market feedbackYes, being open and collaborating with others. But also learning from market feedback. In terms of different factors that influence your company’s strategy, how would you rank market feedback?
Market feedback is really important because it is fundamental to follow the voice of the customer. But, don’t forget to create a good balance between following the market feedback and adopting a disruptive approach. If you only follow the market feedback, you risk having incremental improvement only. However, if you want to be disruptive, you need to combine the insights you get from market feedback with a disruptive approach. At a practical level, it is important to have the sales team explore the different marketing opportunities from the field. And it is also fundamental to have another team, dedicated to thinking outside the box, to explore new and innovative opportunities in the market. Just like Steve Jobs did when developing the first iPhone: following the market feedback while thinking outside the box.
As a sales representative, you’re close to the market. How much influence should someone in that position have on product development and the strategy within your company?
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The sales strategy has to change every year, adapting to the position of the startup. When Easy Welfare was at a very early stage, it was a sales-centric company. In other words, everything was based on sales. So, everything that was requested in the market was developed by the company. But if you maintain this approach, you risk missing the opportunity to scale-up. By following the customers’ needs only, you risk customizing your platform, service or product too much. So, you miss the possibility to grow. You need to move from a sales-centric approach to a sales-driven one, where, sales are still very important but are combined with other functions within the company. This leads to the creation of a new balance. For people starting in roles where you started as well, do you have any tips, for example on how to build influence within a company and on how to take the first steps?
There are many things to say about this. But first of all, active listening. The most prepared sales people listen seven times more than the rest. So, it’s extremely important.
Secondly, related to the first tip is, asking questions. Ask questions to better understand the need and the points of view of the customers.
Thirdly, study, study, study. Be prepared for the meetings. Study the business model of the client you are meeting, but be prepared to talk about anything. You have to build a relationship with them.
Finally, manage the relationships. You need to drive the relationship with your customer, by using the right approach on the right occasion. You need to be able to build common ground, you need to be assertive and you also need to be persuasive.
Startup-enterprise collaborationYou experienced the transition from working at a startup to working at a very large company. What things did you bring over, from working at a startup to your new job? What sort of lessons should people working in large enterprises learn from startups and scale-ups?
I brought several lessons with me when I started working at Groupon. First of all: the make-it-happen approach. When you work at a scale-up, each day is crucial for its growth. Your investors are always on you, like ghosts! Second, the problem-solving approach. When you’re a startup, you often don’t have everything you need to solve the problems you encounter. So, you need to think in a creative way to fix these problems. Thirdly and finally, by quoting Larry Page on his famous book about Google (one of my favorite books), “think in a next-big-thing way” approach. Meaning that you need to think outside the box. You need to understand the opportunities from the market to change your business model. As a big company, if you only look at opportunities from your perspective, you risk missing some. For this reason, I think that the relationship between big companies and startups is very important. Now, big companies need to think in an agile way, and not in a “waterfall way”, using, as I mentioned before, the open innovation approach, exploiting the verticalized business model of startups and their flexibility.And what if we turn the question around, are there lessons that startups could learn from large enterprises?
Jokingly, to have a lot of patience. The lead time and the sales process are extremely long in large companies. When you are a startup, you need to earn money and you need to grow fastly. In big enterprises, times are much longer. In my experience, the average lead time was eight to ten months. While working in a multinational environment, it is sometimes tricky to close the deal, to develop the project and to generate the revenue you need. Moreover, startups could learn from structures and approaches of larger enterprises. They need to learn how to communicate with multiple departments and stakeholders.