Download - Growth, Sales, and a New Era of B2B
© 2017 Andreessen Horowitz | Proprietary & confidential, all rights reserved worldwide.
Martin Casado
Growth, Sales, and a New Era of B2B
Something is Happening
© 2017 Andreessen Horowitz | Proprietary & confidential, all rights reserved worldwide.©2019 Andreessen Horowitz. All rights reserved.
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B2BGrowthSales
© 2017 Andreessen Horowitz | Proprietary & confidential, all rights reserved worldwide.©2019 Andreessen Horowitz. All rights reserved.
✓ Less money to create a startup
✓ Plays to the founder’s strength of product
✓ Incumbents have no defense strategy
✓ Startups can come from anywhere
Growth + Sales
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B2B Growth Sales
B2BGrowthSales
A Cross Vertical Trend
User Authentication
Survey Software
Storage & Content Collaboration
Open Source
Team Collaboration
Cloud Services
Dev/DevOps Tools
Video Conferencing
Design Tools
APIs
Content Enrichment
New Categories
Consumer Companies
PRODUCT & MARKETING DRIVEN
Enterprise Companies
VALUE & SALES DRIVEN
Marketing Led
Brand Matters
Unit Economics Defined by Growth
Sales Led
Product Simplicity Matters
Enterprise Companies Consumer Companies
Relationships Matter
Unit Economics Defined by Sales
Product Value Matters
Marketing Led
Brand Matters
Unit Economics Defined by Growth
Sales Led
Relationships Matter
Unit Economics Defined by Sales
Product Simplicity Matters Product Value Matters
Enterprise Companies Consumer Companies
Marketing Led
Brand Matters
Unit Economics Defined by Growth
Sales Led
Relationships Matter
Unit Economics Defined by Sales
Product Simplicity Matters Product Value Matters
Enterprise Companies Consumer Companies
Marketing Led
Brand Matters
Unit Economics Defined by Growth
Sales Led
Relationships Matter
Unit Economics Defined by Sales
Product Simplicity Matters Product Value Matters
Enterprise Companies Consumer Companies
© 2017 Andreessen Horowitz | Proprietary & confidential, all rights reserved worldwide.©2019 Andreessen Horowitz. All rights reserved.
CONSUMER ENTERPRISE
The VC Perspective
Investing in ConsumerUSERS ARE FICKLE.
WILL PEOPLE LOVE IT?
Investing in ConsumerUSERS ARE FICKLE.
WILL PEOPLE LOVE IT?
“THE GRAPH IS SMARTER THAN YOUR THEORY”
Investing in Consumer
© 2017 Andreessen Horowitz | Proprietary & confidential, all rights reserved worldwide.©2019 Andreessen Horowitz. All rights reserved.
Investing in Enterprise
WILL IT WORK?
BUYERS ARE PREDICTABLE.
© 2017 Andreessen Horowitz | Proprietary & confidential, all rights reserved worldwide.
In Enterprise, Sales/Technical Team
Invest Early
In Consumer, Product/Design Team Invest After Traction
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© 2017 Andreessen Horowitz | Proprietary & confidential, all rights reserved worldwide.
Growth + Sales
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B2B Growth Sales
B2BGrowthSales: The Modern
Enterprise Startup
© 2017 Andreessen Horowitz | Proprietary & confidential, all rights reserved worldwide.
B2BGrowthSales: The Modern
Enterprise Startup
Startup focused on simple use
case
Gets bottoms up adoption
Becomes a well known brand
Overlays sales Products grows in
complexity and value
1Buying software is a
daily ritual everyone does. 2There are more
users who have budget (e.g. marketing, HR).
Why Now?
© 2017 Andreessen Horowitz | Proprietary & confidential, all rights reserved worldwide.
SurveyMonkey’s Organic Adoption to 60M Aggregate Registrations
SUCCESS STORIES OF THE BOTTOM UP MOTIONC
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2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
LAUNCH 10 Languages 21 Currencies
ACQUIRE
LAUNCH Unlimited Annual Subscription
LAUNCH Audience
PARTNER NBC News
LAUNCH Apple App
ACQUIRE
LAUNCH Android App
PARTNER Fortune
ACQUIRE
INTEGRATIONS Marketo • Microsoft • Google
PARTNER The Washington Post
INTEGRATIONS Salesforce • Oracle • Slack
LAUNCH Enterprise • CX • Engage • Apply
SurveyMonkey Genius
PARTNERS CNBC • The New York Times
INTEGRATIONS Stripe • Workplace
LAUNCH Customer360
If we are unable to continue to increase adoption of our products through our self-serve model, our business, results of operations, and financial condition may be adversely affected. Historically, our business model has been driven by organic adoption and viral growth, particularly from conversion of our free users to paid, with approximately 80% of our new individual paying users coming to us. We are currently expanding our sales force, which has historically been limited.”
© 2017 Andreessen Horowitz | Proprietary & confidential, all rights reserved worldwide.
Dropbox Relies on Bottoms Up Marketing Through $1.1B+ Revenue
SUCCESS STORIES OF THE BOTTOM UP MOTIONOur lack of a significant outbound sales force may limit the potential growth of our business. Historically, our business model has been driven by organic adoption and viral growth, with more than 90% of our revenue generated from self-serve channels. As a result, we do not have a significant outbound sales force, which has enabled us to be more efficient with our sales and marketing spend.”
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2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Founded
Public Launch
iPhone App
Android App
Dropbox Teams APIs
Released
1st Shareable
Link
Dropbox Business
Dropbox Integrations Salesforce • Microsoft • HP
Commenting Dropbox Badge
Infrastructure Optimization Completed
Dropbox Professional Dropbox Paper
Smart Sync500M+ Registered Users 180+ Countries $1.1B+ GAAP Revenue 11M+ Total Paying Users
© 2017 Andreessen Horowitz | Proprietary & confidential, all rights reserved worldwide.
Growth MotionExample: Cloud-based, simple product engaging single user
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Sales MotionExample: On-prem, complex product
built to attract large enterprise
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The Two Motions: Growth + Sales
© 2017 Andreessen Horowitz | Proprietary & confidential, all rights reserved worldwide.
Two Motions: Many Times the Operational Complexity
Growth + Sales
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B2B Growth Sales
!
© 2017 Andreessen Horowitz | Proprietary & confidential, all rights reserved worldwide.
Bottoms Up Growth with No Sales
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GrowthSales
© 2017 Andreessen Horowitz | Proprietary & confidential, all rights reserved worldwide.
Sales with No Bottoms Up Growth
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GrowthSales
© 2017 Andreessen Horowitz | Proprietary & confidential, all rights reserved worldwide.
Growth Engine Doesn’t Lead to the Correct Buyer
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GrowthSales
© 2017 Andreessen Horowitz | Proprietary & confidential, all rights reserved worldwide.
Bottoms Up Growth Cannibalizes Sales
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GrowthSales
© 2017 Andreessen Horowitz | Proprietary & confidential, all rights reserved worldwide.
Sales Gets Ahead of Growth Engine
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GrowthSales
© 2017 Andreessen Horowitz | Proprietary & confidential, all rights reserved worldwide.
Sales Ruins Purity of Bottoms Up Growth Function
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Product Considerations
Start simple. End complicated.
Move from horizontal to
vertical.
Analytics and growth levers should be in
product.
© 2017 Andreessen Horowitz | Proprietary & confidential, all rights reserved worldwide.©2019 Andreessen Horowitz. All rights reserved.
© 2017 Andreessen Horowitz | Proprietary & confidential, all rights reserved worldwide.
Thank you.