By John Ortbal, President Services Marketing Group
It is estimated that 40 percent of venture backed companies fail; 40 percent return moderate amounts of capital; and only 20 percent or less produce high returns. It is the small percentage of high return deals that are most responsible for the venture capital industry consistently performing above the public markets.
For the past 15 years I’ve been a key contributor in marketing several software and hardware technology startups and early growth stage companies in the US. In some cases I’ve served as the VP of Marketing or Director of Marketing Communications, and in others as a contract consultant focusing on developing brand positioning and creating marketing programs to launch or revitalize a young firm. My fellow team members at the time are now VP’s of Marketing and CMO’s at successful technology companies across the country.
Helping to launch a dozen or more tech companies that were eventually acquired by larger enterprises, I’ve learned a few lessons in marketing that I want to share.
Thought Leadership is a primary differentiator
While launching a new company or growing a young company requires an outstanding product /service, marketplaces today are so cluttered with new and innovative ideas that the real differentiator in my experience is thought leadership.
How does one define thought leadership? Here’s how writer Shel Israel in Forbes magazine described the concept.
A thought leader is someone who looks at the future and sets a course for it that others will follow. Thought leaders look at existing best practices then come up with better practices. They foment change, often causing great disruption.
Not everyone can be a thought leader on the scale of Steven Jobs or Martin Luther King. For most young companies, it’s enough to be a thought leader for a specific audience or niche market.
To establish thought leadership you have to know your audience, understand what motivates them emotionally as well as rationally, and stake out a position that presents a unique perspective. Keep in mind that your positioning is not thought leadership unless it breaks through the status quo to challenge the conventional thinking or habits of your audience. Plus, when positioning yourself as a thought leader in your space, you’ve got to reposition all your competitors as lacking in both vision and capabilities.
Redefine the playing field according to your rules
Time and again I’ve seen startup or emerging growth tech companies floundering in search of the “right” messages to demonstrate the superiority of their products. What they should be concentrating on is creating a context or playing field that leads inevitably to the conclusion that their product is the right solution for the problem situation.
In most cases that means re-defining or refreshing the perceptions surrounding the category where your product/solution plays. So when you stake out a thought leadership positioning and start promoting your agenda, you’ve got to define the new rules and convince others of their validity and value.
This of course is not nearly as easy as it sounds. You’ve got to understand your audience and marketplace, see where customers are frustrated and in pain, and give your audience hope that there is a reasoned, workable solution within their grasp.