Mark Bruneau - Selling intangibles - Wins and sins


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Startupfest 2014

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Mark Bruneau - Selling intangibles - Wins and sins

  1. 1. Professional Services Start-up That Scale Start-up Festival Montréal July 11, 2014 1. Defining Intangibles 2. Scaling Services 3. Wins & Sins — A Personal Journey Mark Bruneau Founder & CEO of ADVENTIS and VELOCENT
  2. 2. Selling Intangibles: Wins and Sins 1. What does “Intangible” mean? 2. Building A Scale Services Business 3. Services Start-Ups Wins & Sins Mark Bruneau Start-Up Festival, July 11, 2014 1
  3. 3. 1.1 Defining Intangibles Selling intangibles… Can be: • Imagined • Infered Need to be: • Touched • Seen • Quantified Use active listening & incisive language to shape a vivid picture of the Journey and its outcomes … Requires a bridge from ideas to concrete results Measurable outcomes • Market share • Enterprise value • Competitivity Superiority Intangibles Tangibles IDEAS RESULTS • Overcoming Doubts • Make Them Believe 2
  4. 4. 1.2 Language that Surfaces Issues & Opportunities “I did not sculpt David — I removed the excess stone that released him” - Michelangelo 3 Active Listening 1. Invest in developing deep understanding of the client business, industry, and possible issues & opportunities 2. You want to sell more? “Stop talking” — don’t think about what to say next — Listen to infer coded needs 3. Develop real-time hypotheses and use investigative questions to test them 4. Synthesize, summarize, and paraphrase in real-time Client Confidence 1. “I respect you, you’ve taken time to learn about me, my company, my industry” 2. Earn the legitimacy to ask deep questions 3. “This consultant can help me sound GOOD” — “You express my issues & opportunities more incisively than I can ever after 10 years” 4. “I will enjoy the process of working with this smart person”
  5. 5. 1.3 Less is More “You don’t sell intangibles by talking about them, but by demonstrating just what it feels like to work together.” Charles H Green “When your work speaks for itself, don’t interrupt” “Consider both interpersonal chemistry and strategic needs to determine which relationships to cultivate” Don Moyer, Harvard Business Review Henry J Kaiser 4
  6. 6. 1.4 First Be an Expert — Then Be a Friend • Most CEO’s are lonely: ‐ In the pursuit of power and wealth many have lost family, friends, a personal life… • Most CEO’s are mis-informed and are told by their senior executives highly varnished truths • Over time, through trust, empathy, and external comparative knowledge — be a friend: ‐ Truthful ‐ Empathic ‐ Helpful and they will keep you around a long time! 5
  7. 7. Selling Intangibles: Wins and Sins 1. What does “Intangible” mean? 2. Building A Scale Services Business 3. Services Start-Ups Wins & Sins Mark Bruneau Start-Up Festival, July 11, 2014 6
  8. 8. 2.1 Understanding the Leverage Model Finders 1 Minders 5 Grinders 25 Leverage Consulting Model Cost & Value • Rain Makers ‐ Rare ‐ Prima-donna • Extract maximum value from teams • Rigorous research & analyses Early stage: "highly customizable" work performed by skilled professionals - no standardization and reproducibility. Low leverage model: After 2-3 years, a few senior people sell their expensive time at expensive rates. Limited growth potential. High leverage model: Bill out junior people at high utilization. Profit drivers: • High utilization rates • Allows finders to secure new projects. Key enablers of high leverage: • “Lead" the market in a particular industry sector or functional area • convert learnings into reproducible, standardized modules 7
  9. 9. Productable Teachable Deliverable Highly Customizable Services “Guru” Standardized & Reproducible Services Standardization Engine Product Marketing “Products” for Clients “Training” for Staff “Delivery Set-Up” for Organization Learnings Learnings Learnings Cost Low Geographic Expandability High HighLow Client Value Proposition HighHigh Scale allows lower cost, speedier delivery and a deeper network Sub-Scale At-Scale 2.2 Why Scale & Leverage Matter: 8
  10. 10. 2.3 From “Guru” to a Sales Generating Machine Get Published • Identify trade publications • Get to know the editors • Learn what they want • Submit articles Get Referred • Do great work • Refer others • Consistently connect • Ask for referrals Be the Authority • Identify your special knowledge • Master public speaking • Develop list of opportunities Be Connected • 2 Industry events per month • Be very curious • Be very helpful • Reconnect with those you meet Engage in Social Networking • Blog • eNewsletter • LinkedIn Networking • Reconnect with those you meet Engage in Community • Something you truly care about • Add value • Learn the etiquette • Reconnect with those you meet 9
  11. 11. Selling Intangibles: Wins and Sins 1. What does “Intangible” mean? 2. Building A Scale Services Business 3. Services Start-Ups Wins & Sins Mark Bruneau Start-Up Festival, July 11, 2014 10
  12. 12. 3.1 A Personal Journey 11 After Harvard Business School 1986, I joined Mercer Mgmt Consulting — after 5 years I had vaulted from “Associate” to “Senior Associate”… Too slow for me I thought I could do it faster, sell as well as Partners I worked for — so I started my own firm — me and a box of business cards In 5 years, we reached $10M revenues, in 10 years we reached $60M in revenues — with no debt nor line of credit I sold the firm shortly after — for 1.25 X revenues
  13. 13. 3.2 My Learnings — Wins & Sins WINS + Keep cost as variable as possible • Part-time high caliber stringers • Well networked home offices + Clear value proposition, well defined industry or functional expertise + Scope projects narrowly and precisely — Then OVER deliver + Set achievably stretch revenue (objectives sold – billed – and collected) for each partners – with clearly defined functional or sub industry charter + Commission 2-4% on fees sold + Hire staff slowly (after demand is secured) + Hire the best – Pay what it takes (test for work ethic and cultural fit) + In case of M&A offer generous retention bonuses over 3 years SINS − Over-commit to fixed costs (people, office space, etc.) − Generalist value proposition − Over-promise on contract scope and deliverables – working beyond scope is never appreciated − Unclear performance expectations by level − Neglecting marketing and sales prospecting while delivering − Mistaking big contract revenues as lasting forever 12