There’s a lot of talk—including on this blog—about managing revenue in a downturn. How to make smart cuts and pivot to ensure you’re investing in growth. And how to stop leaks that put pressure on already tight margins.
But most of that advice assumes some level of revenue maturity, namely a healthy dose of ARR to work with. And that begs the question: what about those early-stage companies in a seed or Series A round, still getting their footing in the market? How can they pull through until demand bounces back?
Shruti Kapoor, who founded Wingman in Bangalore in 2018 and, in March 2020, was freshly minted with a seed-round Y Combinator investment, says that founders can weather a weak macro environment by focusing on product-market-fit. Which, ironically, is why she started Wingman in the first place.
“I was working at a company called Payoneer,” she recalls,” helping them figure out their go-to-market in India. And that’s when I was introduced to sales and marketing and the whole journey that needs to happen to bring marketing, sales, customer success, and product together to make sure they’re not only building the right things—but messaging them the right way to customers.”
Wingman was conceived as a way to tie it all together, and solve for what she observed to be the biggest disconnect: a breakdown between sales on the front lines, and marketing and product, further from the customer.
“Marketing and product constantly wanted to know what the customers were saying,” she says. “And there was no way for them to know. It was really frustrating for sales to constantly go on calls, and then try to explain to marketing what the customers are saying.” The problem is even worse for remote or distributed teams that may not even share an office.
Her fix: Wingman, which listens in on customer interactions and uses AI to generate insights, action items, and more. The trouble was, it was still very much in beta when COVID struck, putting growth at risk. Today, with 3x growth over the past 12 months, and having recently been acquired by Clari, Kapoor is sharing the lessons she learned in 2020 to help early-stage founders and leaders survive the current downturn.
Here are her tips.
Listen, listen, listen
Wingman sells primarily to sales teams. But in 2020, amid the COVID crash, Wingman found itself selling to teams whose headcount was being slashed in real time. Her largest customer’s sales team shrunk 80%.
“We realized, we cannot be out there necessarily selling right now,” she says. “What we need to be doing is to be much more receptive to what customers are saying, versus trying to sell them on our product. So we changed gears into listening mode to say, ‘Let's use this time to just go back and understand how people are using our product.’”
Sellers made a priority of understanding exactly what customers were doing with Wingman, how they used it day to day, what they liked and didn’t like about it, and what the data showed about how it was being used. They also made a habit of asking customers how Wingman could be more helpful.
“We learned that while sales leaders wanted to coach, it was hard for them to find time to do that,” she says. “So we built features to scale coaching and feedback.” Battlecards could be set up to serve as quick reinforcers for coaching. GameTapes came about as a way to help reps learn from each other more easily. Listening became core to running revenue effectively.
“We also realized that often a lost deal was the starting point of a coaching discussion, so we decided to address those more proactively with deal intelligence and alerts,” she adds.
Think in terms of your customers’ revenue, not your own
In a downturn, your customers are likely experiencing the same sort of revenue pressure that you are. With that in mind, rather than just focusing on locking them in for renewal, and securing their contribution to your revenue, Kapoor recommends pivoting the conversation in the other direction.
“Start thinking about how you actually impact revenue for your customers, and talk in that language,” she says. “The more you can think in terms of not, ‘how do I get more revenue for myself?’ but, ‘how do I get more revenue for my customers?’, the more your message is likely to land.”
Kapoor also points out that this approach can lead to an understanding among sellers of whose revenue can be helped and whose can’t. The latter may not be worth putting your time and resources into.
Maintain alignment with co-founders
A huge, underreported reason that companies fail, according to Kapoor? Misaligned founders.
“People get into conflicts, or even worse, they are conflict averse and they go into separate, parallel workflows,” she says. “And that can be a disaster, especially as the economic situation deteriorates.”
Founders often specialize in certain areas, but the risk is that lines of communication dry up in the name of efficiency and execution, or that one founder is reluctant to question the other’s focus area. This is a classic example of revenue leak, and that’s exactly what you don’t want—especially during a weak macro environment. At the very least, everyone needs to feel that they are empowered to ask questions and understand why certain decisions are being made.
“There still has to be one person making a decision on one function or area, but everybody should be able to have the opportunity to question and brainstorm on those areas,” she says “Because then you’re able to get the best outcome from all the brainpower that you have, versus just relying on saying, ‘hey, let’s be efficient, let’s talk less, let’s just get out there and do what we each know best.’”
Don’t expect it to be easy
It’s easy to get caught up in the fantasy of tech-founder success, but it's never as easy as it appears from the outside. Set your expectations accordingly.
“I always hear these success stories, like TechCrunch articles that never talk about how hard this thing is, and how little sleep founders are getting,” she says. “But I think just making that part human is helpful, because every time you are going through a hard phase, know you’re not alone.”
And when in doubt—and there will be doubt—go back to the customer.
“At the end of the day, what your customer is telling you and what your market is telling you has to be the underlying source of truth for the decision that you make.”
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