Unfortunately, not every founder ends up in a happy ending scenario. Your company might fall short even before it reaches the IPO stage. If that happens and your startup can’t deliver on its promises, what happens next? If you’re like most founders, you’ll likely feel disappointed and demoralized, at least in the beginning. Resignations are common, as are clashes of egos and clashes of visions. Once you’re ready to face reality, now what?
A New Solution Can Make All the Difference.
The first step is to identify your own emotions and overcome them. By gaining distance from yourself, you can see objectively that you are not your company. You have defined your company's mission, and you can see the vision that led you to start it. The most successful entrepreneurs have shifted their focus from themselves to the value of their products or services.
Uncovering Your Fear of Failure or Success
It is important to understand why you're afraid of selling your business. You may be concerned about money, or you might feel a sense of loss - but what is it? It's best to admit that you're afraid and move forward with a clear mind.
Define Success
Next, define what success looks like for you and your business. To do this, think about how much money you want to make per month, how many employees you want to hire, what kind of office space you want and any other criteria that will make your life easier if they are met through selling your company. If you are unsure of what success means for your business, call a trusted mentor or adviser and discuss this with him or her.
Is This the Right Move for the Company?
It's a mistake to think of selling your company as a single decision. It's really a two-part process: first you decide whether to sell, and then you decide who should buy your company. If you make the first decision correctly but the second one poorly, it can easily lead to disaster.
The most important thing for founders to appreciate is that selling your company is hard work. It requires more skill than founding it did and more discipline too. When you found the company, you could spend your energy on any part of the business that needed attention. Now you have to focus on the sale, because that's what will determine whether or not you are successful as a founder—which is why it matters more than whether or not the business succeeds as a business.
The challenge in selling your company is not just that there are lots of potential buyers and they all want different things. It's also that if you go ahead with the deal, suddenly your interests will be directly opposed to those of everyone else who worked on building the business up to that point, including investors, employees and customers.
Manage Tough Emotions by Building Trust
At its core, a sale is a relationship.
If you're trying to sell your business, your primary goal is to build trust with a buyer. Buyers want to buy from people they can trust and businesses that are honest and straightforward. Therefore, presenting yourself in a trustworthy manner will help to increase buyer confidence.
Telling the truth is the best way to build trust. If you tell the truth, buyers will see you as a credible source of information. Dishonesty can destroy trust. If you lie about your company or its performance, or if you misrepresent it in any other way, you'll be seen as untrustworthy.
You need to be truthful about all aspects of your business: its capabilities, its products, past achievements, present situation, and future potential. The more accurate and detailed your information is, the more likely it is that you'll build trust with buyers.
Don’t Forget to Prioritize Yourself
The process of selling your company is hard enough. Don’t make it harder by forgetting to take care of yourself first.
The sale of a business often provides enormous financial rewards for the founders and early investors, but those rewards can come at a high price. Founders and early investors often have to make sacrifices during the sale process to maximize their return, such as giving up decision-making authority, agreeing to long-term employment agreements and foregoing liquidity for equity in future rounds.
When you are putting all of your energies into maximizing the value of your company, it is easy to forget about your own needs, including:
Your reputation: You might want to postpone or even give up access to the data that you have amassed on your customers; however, if you rely solely on memories from customers or written notes that you keep in a file, you risk jeopardizing your reputation. Also, be careful not to burn bridges with people who will be important in your next venture.
Your finances: During the sale process, you may need to accept lower-than-market salary or compensation terms. If you are also making sacrifices in terms of time and other commitments while running the company, this can put stress on personal finances as well.
If you feel that your company is worth more in the current market and are considering selling it to another party, know that there will be a huge emotional rollercoaster. It is important to keep yourself centered and level-headed so you don’t get caught up in the hype of the sales process. If you can do that, then you might find an easier way to say goodbye to your baby and look forward to what comes next for you.
Go VC is an early seed venture capital firm that invests in a diverse range of young startups in the tech space and beyond. The core mission of Go VC is to build successful investment partnerships that include capital and expert strategy to ensure all investments achieve optimal results.
If your business relies on recurring revenue or subscriptions to function and grow, customer retention is a make-or-break metric for success.
But lots of companies choose to focus on flashier numbers like total sales or the number of new customers instead.
Avoiding these common customer retention mistakes can set your business up for sustainable growth by keeping your best buyers happy. Further, new buyers are more likely to come back for more if you have the right fundamentals in place.
1. Not Tracking or Learning From Customer Behavior
Tracking and analyzing user behavior before, during, and after conversions is one of the key ways to build a brand and succeed online.
Even with the attribution problems created by recent changes to data privacy protocols, the information available on user actions can produce valuable insights and help you build your customer base.
When you’re trying to attract new customers, you can look at ad and campaign performance to see what’s working and what isn’t. And if you’re trying to retain customers, you can measure the performance of tactics like cart abandonment email flows, upsell campaigns, and loyalty programs to see what your existing audience responds to.
2. Focusing Solely on New Customer Acquisition
For lots of businesses, it’s easy to prioritize new customer acquisition over nurturing and maintaining the customer relationships you already have.
In a way, it’s like fishing. It’s a lot more fun to catch a new fish than feed the fish you’ve already brought home.
But if you want to build your business, the fish you already have are going to be your bread and butter. (Yes, that’s a mixed metaphor. I’m hungry. Let it go.)
After all, existing customers are more likely to buy when they see your marketing, more likely to spend at a higher rate than a new customer, and more likely to recommend your brand to a friend than someone who hasn’t purchased from you before.
3. Lackluster Social Media Presence
Social networks are a great place to advertise and reach a wider audience. But the ability to connect with your current customers on social media and build on the relationships that keep your retention rates high is just as important.
One common example is when existing customers comment on a social media ad with questions about a completed purchase. If these go unanswered, you’re missing an opportunity to engage with your buyers and showing prospective customers that you don’t prioritize post-purchase support.
And if managing social media interactions sounds like too much work, an integrated helpdesk like Gorgias can collect all of those responses into one dashboard so you can sort and answer them effectively.
4. No Dunning Solution for Customer Retention
If you’re scaling a subscription-based business, keeping up with the minutia of manual billing isn’t an effective use of your time.
In contrast, establishing an automated dunning solution can minimize a common source of customer churn. You can contact customers automatically if, for example, their credit card expires before their next subscription renewal and they need to input new information.
You can also create templates that pull in dynamic content from the customers’ records to personalize the messages. Finally, automated dunning frees up the hours you and your team spent on billing for more productive efforts.
5. Poor User Experience
Providing both new and existing customers with an optimized user experience is another pillar of customer retention.
First, if you aren’t staying on top of basic best practices like page loading speed, functional calls-to-action, brand consistency, and mobile experience, you’re leaving conversions (and revenue) on the table. And even when you do get customers to convert, those nagging problems greatly reduce the likelihood that they’ll come back for upgrades or additional purchases.
Are you looking for an investor with the funds and foresight to take your business to the next level? Contact GOVC now to see if we're a good fit.
Digital payment methods and automatic billing for subscriptions are incredible conveniences for shoppers and businesses alike. It’s easier than ever to sign up for a service or buy a product and opt-in to recurring fees for access or a regular parade of items to your door.
That lack of friction on the front-end can make things difficult when its time for customers to renew or update their payment information, however. Before long, business owners and staff may find themselves spending hours and days trying to connect with customers who have been active users but suddenly have inactive credit cards.
The solution for these problems is usually a dunning system. But before we get too far, let’s establish what dunning is.
Dunning Defined
Dunning is an old word that describes an even older process — getting your customers to pay what they owe for your products or services.
Collecting on debts has always been an issue in the business world, but startups and software-as-a-service (SaaS) companies are especially sensitive to payment collection concerns.
For startups, effective dunning can be the difference-maker that keeps your doors open and lights on in a given month. And because SaaS organizations largely rely on subscriptions for revenue, it’s a good idea to backstop your billing process with a dunning solution to keep your balance sheet reliable.
4 Reasons to Invest in a Dunning Solution
Dunning is useful for lots of organizations, of course, not just SaaS and startups. Here are four reasons to invest in a dunning solution for your business:
1. Avoid Recurring Revenue Loss
Monthly recurring revenue (MRR) is the lifeblood of lots of companies, from SaaS to eCommerce to marketing agencies. And if you want to grow, you can’t just rely on a steady flow of new customers — you need to keep the customers you have.
A dunning solution can help with that by alerting you when a customer’s payment doesn’t process, retrying that payment method if necessary, and reaching out to the customer to revise their payment information, among other things.
Retaining existing customers — and the steady flow of revenue they provide — is essential to long-term growth and sustainable success.
2. Reduce Involuntary Churn
Involuntary churn occurs when you lose customers or subscribers because their payment information expires and isn’t updated or followed up on.
Most of these cancellations aren’t on purpose; you and your customer just failed to connect in time to keep the account active. One study found that more than one-third of involuntary churn is because of these payment failures.
A dunning system can be an effective solution to this problem. You can put automated rules and triggers in place that let the customer know that their information has expired and their account access will go away if it isn’t updated.
It can also protect your company’s reputation, as customers won’t have unexpected interruptions to their service.
3. More Customer Interactions
Dunning does more than just maintain payments and subscriptions — it provides another opportunity to connect with your customers and build a stronger relationship.
If you want to maintain customer loyalty and increase lifetime value, you’ll need to make every effort to connect in the case of a failed payment or expired information. But if your first message regarding collections is an urgent ‘account suspended’ email, you’re likely to create a bad impression with your users. And even if they do renew right away, they’re less likely to stay with you long-term after that.
4. Save Time with Automated Solutions
Let’s get real for a second. Chasing down payment information and sending messages to collect money you’re owed isn’t much fun. And it’s important to strike the right tone with your customers so they don’t feel like they’re being harassed or shamed for lack of payment.
That’s another area where automated dunning can help. You can take the time to craft messages that empathize with your customers and set them up to go out automatically instead of agonizing over personalized messages to each person. And if users have questions or need one-on-one assistance, you’ve already established a pleasant and professional baseline to continue the conversation.
In summary, if you’re losing subscribers to expiring payment information or struggling to keep up with customers who aren’t paying their bills, the right collections solution can work wonders for your business.
Contact GO VC now to discuss more ways we can help your business grow.
Venture capital (VC) investing can be a volatile field, especially for those who specialize in startups and early-stage investments.
That said, unlike passive investments in stocks or funds, venture capital investors can take a much more active role in the performance of the startups and companies they choose to partner with.
Why is Risk Mitigation Important?
The right combination of proactive support and risk mitigation can increase the likelihood of a startup’s success — and a successful exit from a given investment.
With these five risk mitigation tactics, you can rest easier knowing that your portfolio is as protected as possible.
1. Due Diligence
Anyone who enters the venture capital world without committing to a robust due diligence process isn’t going to be investing for very long.
Due diligence is a process that every VC goes through before investing in a startup. Standard considerations include analysis of the market opportunities, management team, business model, operations workflow, technology and more.
Also, due diligence doesn’t stop once the capital changes hands. Certain forms of transparency can be baked into the agreement to keep an eye on how the investment (and the startup) is performing. These can include everything from access to accounting metrics to regular compliance audits and stakeholder meetings.
2. Diversification
What do farmers and venture capitalists have in common?
Neither should have all of their eggs in one basket.
Diversifying your VC investments is one of the most effective ways to mitigate risk, especially over the long term. Many VCs, for example, commit to a three- to five-year investment timeline with a given startup. This approach provides more stability in that contracts don’t all start and end at the same time. It also helps investors keep track of longer-term performance and take steps to correct any problems that might arise (see #5 below).
This principle also applies to the types of businesses you invest in, or sector diversification, as well as fund diversification, in which a VC chooses to work with early-stage or late-stage startups or a mixture of both.
3. Reduce Variables
Even if the results of the due diligence process are sound, there are a lot of factors that can contribute to a startup’s success or failure.
Further, many of those factors — market fit, competitor performance, vendor availability, advertising effectiveness, etc. — are out of the startup and investor’s control.
Reducing the variables in your investment is another way to mitigate risk. In practice, this might include doubling down on a winning advertising channel, choosing the right niche, or hiring trusted staff that you’ve worked with before. Every question mark that you can turn into a sure thing will boost the chances of your investment’s overall success.
4. Contract Structure
Many institutional investors see venture capital for startups as a risky investment It’s also a well-known fact that even the best ideas don’t always turn into successful companies.
That’s why many VCs include contract language that ensures they’ll get their money back first if a startup goes under or has to be sold under less-than-ideal circumstances. With this structure in place, VCs can protect against failure while still doing all they can to help their startups succeed
5. Hands-On Assistance
Our fifth and final resource for risk mitigation is closer to you than you might think.
In fact, it’s the person you see the mirror.
Most VCs and investors become investors because they’ve succeeded in some form of business or another. That specialized knowledge grows as you work with startups, consider new investments, and track performance over time.
Sharing those lessons with the startups you work with is a great way to chart a more lucrative path, course-correct if necessary, and increase the probability of a healthy ROI.
Looking for a VC partner that can help your startup succeed? Click to contact us now!
If you’re in eCommerce, digital marketing, or any business that sells products and services, you’ll need to write marketing copy at some point.
And as the saying goes, “everyone can write, but not everyone is a writer.”
If you want to make your writing clear, effective, and engaging, you don’t need to go back to 10th-grade English to learn to diagram sentences again. Instead, use these five tools for writing better marketing copy.
1. Grammarly
It should go without saying that your marketing copy should always be error- and typo-free. Readable, professional copy is a baseline you’ll have to meet for successful ads, landing pages, emails, blogs, and other collateral.
Research also shows that clean copy is essential. A survey of more than 1,000 web users in the UK found that over 40% of respondents would be negatively influenced by a brand’s spelling or grammar mistakes on social media.
If you write copy or content in multiple systems like Google Docs, a social media publishing tool, and an email scheduler, it’s helpful to have a spelling and grammar checker on at all times. That’s why Grammarly is so helpful.
Grammarly is a free browser extension that will check your spelling and grammar in Google Chrome, Safari, Firefox, or Microsoft Edge. There is a paid version that provides more functions and tools, but the free version is a must to keep your texxt text error-free.
2. Word Visualizer & Thesauri
Sometimes when you’re writing marketing copy you need a different word than the one that came out of your brain. After all, you can only call a product or service “amazing” so many times before your prospect starts to lose interest.
That’s why it’s handy to bookmark your favorite thesaurus website or a free word visualization tool to use regularly. Mix some interesting, but not pretentious, words into your copy to keep readers engaged.
(Fun fact: Before writing this post, I didn’t know that the plural of ‘thesaurus’ was ‘thesauri.’ Ironically, I found out from the dictionary.)
3. CoSchedule Analysis
CoSchedule produces work management software for marketers, but they have a couple of free tools that are extremely useful for anyone producing content.
First, the CoSchedule Headline Analyzer is a free tool that you can use to generate simpler and stronger headlines across outputs. It produces a score for every version of each headline you put in, and shows a version history so you can choose the most effective headline after trying out a few different versions.
And second, CoSchedule’s Email Subject Line Tester does the same thing, but for your email subject lines.
Neither tool is perfect, but it’s a great place to test the headlines and email subjects you’re working on to get an idea of how they’ll perform.
4. Hemingway Editor
The best marketing copy isn’t just error-free, of course. Your ads, emails, landing pages, and other outputs need to be engaging to hold your audience’s interest. And a big part of engagement is readability.
Multiple sources say that you should write copy for a sixth-grade reading level. That means smaller and simpler words and shorter sentences.
If you’re struggling to share your value proposition or technical information in an easy-to-read way, try running your content through the Hemingway Editor.
This free system, named for famous author (and recent Ken Burns documentary subject) Ernest Hemingway, helps you shorten sentences, simplify phrases, and replace pretentious-sounding words with clearer language. It also includes a grade-level metric so you can see what kinds of edits you need to make.
5. Conversion.ai
If you’re looking to level up your ad copy or produce content at scale, a new generation of artificial intelligence tools is entering the marketplace to make your life easier.
One such tool is Conversion.ai. Unlike the other tools listed above, you’ll need to pay for Conversion.ai’s suite of features, but the opportunities for growth are real.
All you have to do is enter some basic information and the AI tool will generate useable copy for ads, emails, websites, listings, blogs, and more instantly. Specific options include auto-generated headlines and copy for different platforms, a "content improver," a blog post topic idea generator, a social post and caption generator, video topic and script tools, and much more.
If you incorporate one or more of the tools above into your copy and content creation workflow, you’ll save time and produce content that you’ll feel confident about. And if you have team members producing content, these tools can help them too.
Social proof is powerful. And great testimonials are one of the most powerful forms of social proof.
If your business is on social media, relies on referrals, or runs ads for products and services (read: everyone), testimonials can boost everything from early-stage engagement to conversions.
Why Are Great Testimonials Important?
As HubSpot says (but you knew already), potential customers trust recommendations from real people more than your marketing content and sales reps.
And if you’re doing business online, testimonials add credibility and authenticity to your offer. Social proof shows that there’s a positive outcome waiting for customers at the end of the process.
The benefits don’t end there. You can also use testimonials to alleviate buyer objections, show your products or services in action, and build your brand and social media presence.
To get content that does all of those things, however, will require some proactivity on your part.
7 Tips to Get Great Testimonials
Not all testimonials are created equal. To leverage reviews, user-generated content (UGC), and other client comments effectively, you’ll need great testimonials that will resonate with your audience.
Use these 7 tips to get great testimonials that will help your business grow.
1. Make it Easy
One of the least effective ways to ask for a testimonial is to… just ask for a testimonial.
When you give users or buyers a blank slate to say anything they want about your product or service, they’re going to struggle to put a cohesive response together.
Instead, as Optinmonster suggests, start by asking how their experience with your product or service has been so far. When they reply in a positive way, ask for more details and specifics about their results. Once you have that information, summarize what they’ve said and ask if you can use that version as a testimonial.
And if you want to scale up your testimonial-gathering, you can use these steps to…
2. Put a Process in Place
As StoryBrand says, “The best time to get great customer testimonials is BEFORE you need them.”
And if you want to feature great testimonials in your marketing, on your social media profiles, or throughout your checkout experience, you’ll need to create a testimonial-gathering process.
Lots of eCommerce sellers have an automated system for getting testimonials already. You’ve probably received a “what did you think of your product?” email from an Amazon seller or two — that’s a common example.
Whatever business you’re in, it’s crucial to put a process in place to find, capture, and organize testimonials so that you can use them in relevant locations.
3. Timing is Everything
If you want relevant testimonials that resonate, when you ask is just as important as how you ask.
If you ask too soon, your customers won’t have formed an opinion worth sharing. And if you’re too late, they won’t remember the important details that you’re looking for.
The optimal time to ask for testimonials is usually after a project if you’ve provided a service or a few days after they’ve started using or getting value from an app or physical products.
4. Ask the Right Questions
Even if you’ve put an automated, easy-to-use, well-timed testimonial process in place, the responses you get from your customers will only be as good as the questions you ask.
If you want to use your testimonials to engage and encourage would-be buyers, ask about the problem that your product solved and the positive outcomes and benefits that the customer received from your product.
Thoughtful answers to the right questions can be used to reduce objections during the buying process. (Also, those answers will be much more impactful than responses to questions like “What did you think of [new feature X]?”)
5. Use Images and Video Whenever Possible
The more engaging your testimonials are, the more likely they are to convince prospects that your offer is the right one.
That’s why it’s so important to incorporate images and leverage video as often as you can.
If you’re using written testimonials, for example, include the reviewer’s name, picture, and title (if applicable) next to their words. These visual indicators reinforce that these are real people and real success stories.
To that point, it’s a good idea to ask for video testimonials from satisfied customers and partners if you can. Even if it’s just a few seconds of self-shot smartphone footage, having someone say good things about you on camera will always be more engaging than written testimonials.
6. Leverage the Buyer’s Journey
ECommerce sellers and digital marketers should already be familiar with the buyer’s journey or sales funnel.
Great testimonials are a powerful tool for addressing key objections throughout the buying process, especially if your offer is a service or high-value product with a longer sales cycle.
7. Great Testimonials Aren’t Feedback
The responses you get from your testimonial requests won’t be universally positive. While you’re looking for good, reusable content, you’re likely to get critical responses or negative feedback about some stage of your process.
If you ask for a testimonial and receive feedback or criticism instead, use the opportunity to offer support or provide a solution. If you’re able to make the buyer’s frown turn upside down, ask for an updated testimonial that incorporates the steps you took after the initial review.
GO VC provides digital marketing and operations expertise as well as capital to help startups and businesses grow. Click here to contact us and learn more about GO VC.