How I Closed My First 10 B2B Customers With No Network, No Marketing, and No PR (Part 1)

Hello 👋

Martin here. Welcome to another edition of Founders’ Hustle!

I write newsletters containing actionable insights and insider knowledge across the full spectrum of company building from inception to exit.

Today, I’m sharing the first instalment in a multi-part series of how I closed the initial 10 B2B customers for my first startup!

Here we go. Part 1…

Launching a B2B startup is fraught with distinct challenges. Chief among them is defining, approaching, and closing your first set of customers.

Why are your first ten customers so important?

This cohort provides a foundation to test, iterate, and substantiate your product and go-to-market hypotheses.

Or, maybe you’ll pivot and find a new direction as a result of your learnings from shipping and supporting a product actively in the marketplace.

I’ve experienced both scenarios personally and built successful B2B companies from them.

Either way, achieving this is a complete game-changer for your startup.

You’ll have a client base to build exponentially upon, and, greater leverage to hire amazingly talented people or close investment.

You don’t need ten customers exactly, just enough, statistically, to gain confidence the first one or two customers weren't a fluke and that you have a product that’s repeatable and scalable across a larger total addressable market.

The more the better. But, not too many that servicing them exceeds your resource levels. That’s why the figure of 10 is so popular. It’s a general rule of thumb that small 2–4 person founding teams can handle this volume.

Of course, in reality, it’s subjective. You’ll need to figure out what’s an appropriate level for your company.

This first cohort phase is usually very hands-on and involves signing up each customer individually, one at a time. The mechanisms that work for later stage B2B companies are generally unworkable at the genesis of a B2B startup— SEO, paid marketing, PR, referrals, etc.

Actively closing your first ten customers is hard to do if you have no network to tap into and no money to buy or drive market access. You’re a nobody in the industry, so why should anybody trust or care about what you’re doing?

Back in 2010 I found myself in this exact position with my co-founders. I had a job in banking and was building and launching a B2B ad tech startup on the side. My network overlap between the two was exactly zero. And, our marketing budget was virtually non-existent.

We didn’t join an incubator, hire industry advisors, or, secure funding from a strategic investor in order to plug into a network.

I also didn’t have a “flukey” extended-network contact that provided a bunch of warm intros. You know, a friend-of-a-friend-of-a-client through work, or, an uncle who knows the lawyer of someone semi-relevant through a golf buddy.

For better or worse, we went in completely cold to our customer targets.

To pull it off, we needed to figure out 5 key processes:

• Defining target customers. 👥

• Approaching target customers. 🗣️

• Converting targets into customers. 🤝

• Keeping customers engaged.👂

• Driving action at launch. 👊

Searching online for the answers to these questions may lead you to believe it’s a completely hopeless endeavour.

There’s a lot of content out there discussing how many unicorn B2B startups were founded by entrepreneurs in which people in their network became their first customers.

Whilst they're super amazing stories, don’t let it discourage you from launching a B2B startup if you have no existing network or “access” budget.

Don’t get me wrong, you’re at a disadvantage like I was, but it’s not a blocker in the absolute. You just have an extra, significant, hurdle to leap.

If you’re building a product that provides genuine value in relation to a major pain point that’s 10Xbetter (or complementary) to a current business solution, at a price point that makes economic sense, you can close your first set of customers.

For context, my startup provided a content recommendation widget to digital publishers. In return for using the content recommendation widget they received new visitors back from other digital publishers. If you’re curious how it worked, here’s an explainer video.

We started off with a small cohort of customers who provided us with fantastic feedback and traction. To a level that was beyond my optimistic expectations.

That small base grew into tens, then hundreds, of customers, until we saturated our vertical supporting 1,200+ websites.

The momentum was used to close deals with some of the largest digital publishers online at the time, propelling our website to a top 1,000 most trafficked website globally within 16 months of launch (according to Alexa)

Next, here’s how we made it all possible by closing that crucial first cohort of launch customers.

Defining target customers 👥

Before approaching any prospects, I spent time to consider what type of customer would be a good fit for our launch. This is known as establishing an “Ideal Customer Profile” (ICP) in industry jargon.

In order to do this, you will need to have a reasonable understanding of your target market, which I assume is the case.

What’s an ICP?

There’s no official definition, but here’s an interpretation I like:

Take this seriously. If you don’t define an ICP, or calibrate it inappropriately, you risk wasting a ton of time pursuing prospects that won’t convert, or, maybe they will, but the relationship won’t be optimally mutually valuable.

Particularly for a pre-launch startup, it’s critical to pursue customer relationships with outsized returns. And, not just financially, like an established company would optimize for.

Profitability was not the main concern for us, navigating to product-market-fit was. Since our platform was dependent upon liquidity, hitting critical mass was also key to success.

You want your first ten customers to be super engaged with your mission. Often, they feel the pain point you’re solving the most intensely.

These customers will provide invaluable feedback for your product iteration loop, dedicate resources to the relationship, and move quickly so you’re not left waiting at the sidelines. They’ll likely even refer new customers.

Your ICP is not static and will change over time in accordance with your company’s needs and objectives.

It can be tempting to create a really broad ICP in the beginning. Targetting a diverse range of companies of all shapes and sizes gives the perception of a greater chance of success, but, often, this turns out to be false comfort.

Doing this will likely mean trying to sell a product of shallow value to a broad group of targets who don’t have the conviction to bite. Instead, pitching a product with deep value to a narrow group of targets, I’ve found, is much more realistic to pull off.

Although the broad group of targets may be your ultimate total addressable market, building a lean product at such an early stage that is capable of serving such customer diversity meaningfully and appropriately is a tall order.

In order to calibrate an ICP for our launch cohort, I first determined what our business objectives were and categorized them into two buckets:

1. Process-customer-fit

2. Product-customer-fit

I use the terminology ‘customer-fit’ and not ‘market-fit’ here to signify that there was no broader market-fit at that point.

We were just trying to find mission alignment with a handful of prospects on a one-by-one basis, and, nagivate towards economically meaningful market-fit from that base.

For super early-stage startups, an ICP doesn’t stop at product-customer-fit. Process-customer-fit is also a significant factor.

For example, if a prospect’s sales cycle is too long, that instantly disqualifies them as an ideal launch customer. We were on a timeline to build and ship a Minimum Viable Product in three months, so the first criteria for our ICP was a relatively quick sales and implementation cycle.

Some prospects may also have a list of internal rules that govern the possibility of contracting with new external vendors — customer reference & credit checks, regulatory or “industry body” approvals, quarterly discretionary budget constraints, and general bureaucracy.

Or, they may add process for the sake of process — extensive reporting obligations, meeting-upon-meeting with business analysts and legal counsel, etc.

Some prospects may even be affiliated with your competitor through an investor, investment, sister-company or previous or existing business relationship. This can sometimes be a total blocker.

Be wary of prospects that have a unique agenda, driven by legacy technical and operational infrastructure, in-which your missions semi-align, but not really.

It can feel like you’re onto something big in this scenario because such companies can be super engaged with you about solving their legacy problems.

But, there’s also the real risk your startup never really breaks out because the exact problem you are solving has a total addressable market of 1.

In this scenario you become a kind of a wedded ‘cleaner wrasse’ — those smaller fish that stick close to a big fish, like a shark, and survive by purging them of operational inhibitors (dead tissue, skin).

To avoid this, prospects we closed had an aligned interest in our mission and an “early adopter” culture — a customer that’s comfortable being a guinea pig, expects bugs and minimal features, will be hands-on with feedback and will act quickly. When you build that kind of rapport, it’s magic.

I also wanted a prospect to be using a competing product. You may think this is counterintuitive, but, it slices off an enormous burden from the sales process: product category education.

Our launch customers understood the product category, so we could get straight to talking about why they should try our specific proposition within that product category.

They already had internal frameworks and data to quantify our value proposition against their existing setup or solution. This saves enormous time and energy.

Plus, if you have competitors, it’s a good signal you’re attempting to solve a meaningful pain point.

Another key criteria we had was low-friction accessibility to a decision-maker who had single-sign off authority to greenlight working with us.

If decisions were made by committee or by a waterfall management structure, particularly if one or more individuals in that process were relatively inaccessible or uneducated about our product category, that would disqualify a prospect.

What do I mean by “relatively inaccessible”? At some companies, individuals involved in the decision-making process may not communicate externally with vendors.

Such folks operate based on information supplied internally from data fed by colleagues, market reports, and business intelligence. In this scenario you are relying upon one or more contacts to advocate your product energetically and clearly to internal decision-makers. This acts as another inhibitor to adoption.

OK, so here’s a summary of the key process-customer-fit qualifiers we used:

• Short sales cycle

• Early adopter culture

• Understood product category

• Accessible decision-maker

• Aligned with our mission

That’s great, but how did we go about identifying these prospects in the marketplace? To save time and money, our process was a blend of heuristics and research.

As a rule of thumb, smaller businesses are run by owners that are accessible, open to new ideas, have sign-off authority and clout to allocate resources without review by committee, aren’t encumbered by process, and can move quickly.

So, this was our initial filter. Targetting smaller, independent publishers. Typically they had a team size of less than 10.

Not a perfect filter, but material enough to produce a time-effective hit rate for procuring process-customer-fit targets.

But, we didn’t stop there.

We applied more filters. Are they using a competing product? How many other startups do they work with?

These details can usually be found by looking at their products in the wild, using tools like BuiltWith, and Googling their company name for case studies and references published by other startups.

All of this gives vital clues as to how open they’ll be to becoming your guinea pig — an “early adopter”.

The remaining ICP criteria pertained to product-customer-fit.

It’s important to identify what type of customers you can add the most value to the fastest with the least effort.

Look for patterns or themes and add the qualifying attributes to your ICP.

We calibrated to publishers that had:

• Male-Millenial content.

• English-language content.

• Majority U.S. audience.

• Display advertising.

• 500k minimum Alexa ranking.

This product-customer-fit profile combination enabled us to get our product into the marketplace quickly with outsized results. Why?

The core value of our product and servicing abilities was amplified under these conditions.

Crucially, these characteristics, in combination with using a competitor offering, were also a strong indicator the target prospect considered the pain point we were solving a priority, and, that they were open to how we were solving said pain point.

We even made some small product changes to appeal to this target audience even more, which further amplified our proposition.

Do not underestimate the “how” in your proposition. If you’re solving a major pain point but are going about it in a manner unconducive to a target customer’s mission, infrastructure, or operational capacity, it’s a hard sell.

For example, if your solution involves sharing customer data with third parties and your target customer is data-sensitive, the ‘price’ of using your solution (compromising their customer data) may outweigh the gains.

Look for target customer characteristics that your core value proposition would thrive under and indicate objective alignment.

Ask yourself some questions:

• What prospects feel the pain point you’re solving the most intensely?

• Does your product help a certain type of customer more than others?

• What are your prospects' existing suppliers under-delivering on?

• Can you ‘zoom in’ and better serve a niche set of customers within a larger market?

• How can you help them help their customers better?

• Are any using a platform or technology that you can easily integrate with through an API?

This is how our launch ICP looked:

In the next part, I’ll detail how we identified and approached decision-making individuals within the companies that matched these criteria.

Once you’ve figured out your ICP, don’t be afraid to ruthlessly disqualify prospects. In this exercise, most prospects should in fact be disqualified.

Remember, your objective here is to sign ten (or less) customers for your launch or beta. You’re cherry-picking the juiciest candidates. It’s an empowering process that’ll give you intense focus and resolve.

Disqualifying prospects doesn't mean they’ll never become customers. They just won’t be in your first cohort of customers. You’re laying the foundations now so you can work with them in the future.

We didn’t get to work with top global publishers until after we had worked with a ton of small independent publishers first.

Check out Part 2: Approaching target customers. 🗣️

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