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I know, establishing the business KPIs of a young B2B startup is hard. Very hard.A lot of it is set by the marketing functions, whether they are internal employees or external ones.
The decision of who to work with is not easy and there are many parameters to consider. Many founders, being technical creatures in nature, don’t usually know that much about marketing. How can they decide what to consider and understand what’s important to ask?
In fact, it wasn’t uncommon for them to ask me to list the important points, saying “I know almost nothing about marketing, I don’t even know what to ask you”.
Over the years I met with hundreds of founders, and answered, probably, thousands of questions (some of them repeated ones). Some of them were really smart and spot-on. Others… not so much.
Naturally, a lot of the questions were about our expertise and what the fact that we focus on the early stage actually means, but there were many more, important and even brilliant questions.
So, I listed the questions that we felt are most important – for founders and marketers in these stages, looking to hire external help; the ones that I believe are most important to the future success of the company and the mutual work.
I hope this will help you navigate this process and make the right decision, and if I missed a few, shoot me a message, please!
A note before we start..
These questions apply to both internal and external hiring
Also, the questions are relevant whether you are looking for a marketing agency, CMO-on demand or a fractional CMO – the differences are only nuanced ones.
#1: Can you both lead and execute the entire marketing operation?
An early-stage startup needs to build and execute multiple activities, dynamically, and toggle between them. Most vendors are not built for such flexibility and don’t offer such a rich portfolio of services. Most marketing managers are great orchestrators but they are not proficient in hands-on work of various activities such as SEO, paid media campaigns, PR, content writing for technical audiences, and more. Budget and resource limitations are also challenging.
In the early stage, I often find myself not only orchestrating but also managing (hands-on) multiple tasks, from messaging, website, collateral, PR, product marketing, and SEO, to paid campaigns or content.
I work on the website, suddenly there’s an industry conference to prep for, and the next day? Boom, a new feature is released and we need to decide whether to run a PR or not. Another day passes by and there’s a momentum that wasn’t there before- Quickly there’s a need to run a paid media campaign. Sounds familiar? That’s the case 100% of the time.
In most cases, founders are not even 100% sure of what needs to be done in order to maximize the impact.
In fact, if I were an early-stage startup founder, I would use this question as the basis of my discussion in the selection process and look to work with a vendor that wouldn’t only “sell” me some services, but would also help by drawing a strategic map of activities and timelines. It should be done based on the near future KPIs, resources, budget, industry, business model, and more.
Then I would go elsewhere and validate it. Finally, I would return and discuss what I learned.
To summarize – Most early-stage startups can’t afford an expensive marketing operation that is built on multiple vendors and players. So, my advice is to ensure that whoever you’ve selected, be it an agency or a fractional (or a full-time) CMO can execute tasks such as PR, content, industry conferences, website management, product marketing, collateral, SEO, paid campaigns and more, without needing additional budget.
#2: What budget do you need and what can you do with it?
Different stakeholders are used to different budgets and therefore may find it difficult to adjust to the budget that usually comes with Seed or Round A startups. For instance, some agencies will not run LinkedIn campaigns for less than $15K per month, saying it’s just not effective. Others will not be able to deliver a minisite for anything less than $30K.
Here too, many times founders are not really sure how much they should spend on marketing nor what costs are acceptable in this industry. They may hire a CMO or an agency that doesn’t handle all the needed activities, and find themselves needing to add more and more money to the operation.
Many agencies, those that aren’t specialized in the early stages, are used to working with internal marketers that take a lot of the load. They are used to spending much larger budgets. It makes sense when we talk about more mature startups, but the early stages are a different story.
Moreover, they expect founders to come with a clear vision and knowledge of how much they want to spend, and many times will try to stretch the budget limits way higher than the startup can afford at this point, way higher than what the startup really needs at this point.
For example, some vendors look to engage in full implementation of Hubspot marketing and sales hubs, even for a Seed stage, or even a stealth mode startup. That’s quite expensive and such implementation isn’t usually needed at this stage. The basic implementation can be more than enough until the marketing and sales operations become more mature.
There are major differences between startups, based on industry, product maturity, and more. For instance, medical device startups may need many years of clinical trials and will mature their business units only when they near regulatory approvals.
But, still, in the majority of cases, marketing should be done right after the first significant round, handling multiple KPIs of awareness (among prospects, employees, and future investors), market traction, initial deals, and competitive edge.
And the budget should be strict and well-crafted for this stage.
To summarize: Many times, I find myself helping founders decide on the right marketing budget for the startup. They appreciate the option to lean on knowledge gained from our work with many other startups at this stage. Many tend to budget too little, are not sure what activities to include in the mix and what price ranges to take into account.
My 2 cents: The budget should be a certain % of the round, and it should take into account the resources, as well as assets production (such as the website, collateral, etc.) and ongoing activities (conferences, paid campaigns, SEO, content writing, influencer marketing and communities management and more).
Work with a vendor that can help you pilot activities and feel the market – this can be done even with campaigns that cost no more than just a few thousand dollars a month, an initial website that doesn’t cost way too much (you will change it a lot in the early stages… messaging, content, structure… ), A vendor that understands what being lean means, and will be able to work with extra low budgets
#3: Service pricing… What’s included and how flexible is it?
Naturally, this set of questions is ALWAYS on the table. We are always asked about our pricing model, what’s included, what’s not, and the level of flexibility in moving between tasks and areas of responsibility (startup mode after all).
While mature companies can support a different budget for each unit (such as growth, demand gen, marcom, product marketing, etc.), for early-stage startups the situation is different.
Most agencies will offer specific services, for a given price (such as a retainer, hours, % of media spent, etc.), and adding more services will require additional budgets.
The toggling between different activities under the same capacity is not very common among agencies due to obvious reasons. Even if they were able to allow for toggling, skill-set-wise, they will struggle to offer it at a reasonable price that a startup can meet. Stand-alone, fractional CMOs on the other hand, are usually much more flexible, but they will usually require additional resources for 3rd party execution.
I believe that early-stage startups need something in between. A predefined service fee, that is fixed and is feasible to their stage, on the one hand, and a flexible approach that allows toggling on the other hand. We call it the Hybrid approach.
I am biased of course, but still, I think that our method is the right one for the early stage. We tend to work in a retainer model as this is the most affordable model for young startups and most times makes more sense. It allows for parallel management of several marketing areas such as social media, content marketing, paid campaigns, etc. plus CMO on demand. It also allows for toggling between activities if needed (for instance working on industry conferences, product marketing needs and PR drops, from time to time, on top of the “regular” stuff)
In order to estimate the service fee, check what’s included, make sure it includes the management and orchestration as well (you need it), and don’t forget to ask about the extras.
#4: Is the CMO-level management layer included?
Like I already said, many founders I talk to can build a rocketship (not really but you get the idea) but couldn’t build or assess a super basic marketing plan. You will be needing someone to orchestrate the party. Many founders don’t fully understand that.
A founder recently told me “I am not looking for a Captain, I need a soldier”. Well, not quite. You need a single player that can do both. Plain execution with no strategy and thought behind is a sure disappointment.
On the other hand, startups in such stages are reluctant to hire consultants (or C-level executives) that offer the strategy and not the hands-on work. Rightfully so I must say. They are looking for an offering that goes beyond just building the strategy and plan – an end-to-end service that also includes the actual project management and execution of the different marketing activities down to the last detail, from banner to copy to producing content, to analytics, and more. This is one more question where I see how important the one-stop-shop concept is for founders.
Search for the solution that includes both layers: CMO as a service and multi-area execution of all activities – There are such creatures out there.
#5: Who will be doing the actual hands-on work?
In the early stage almost no foundations are built yet, let alone solid ones. In other words, there’s no “clone” option for proven strategies.
It means that the hands-on work must be super smart and well experimented, in order to maximize the potential of each activity and ensure that nothing fails due to poor execution.
In other words, I don’t think that the initial execution in the early stage can be done by junior professionals who don’t have enough experience or the full contextual knowledge of the product, the ecosystem, etc. – Be it campaign management, SEO, content writing, social media marketing or any other activity.
When a fractional CMO delegates the work to low-level vendors, there’s a huge risk, and I’ve many times witnessed poor execution that led to collateral damage.
BTW, that’s not such a big risk for more mature companies – there’s enough proof for what’s been working and can be replicated, there’s a need to execute in scale, not build more strategies, and there are enough internal resources to supervise the quality.
You would want to know and trust not only the big boss (the CMO) but also the team that is doing the hands-on work. In the early stages, they must be experienced (for instance have filled product marketing or marketing management roles in tech companies).
You should also ensure that the people you talk to before you start the engagement (and are talking marketing shop fluently) will be there, leading the operation, after the engagement starts.
#6: Deliverables and timelines – what should I expect?
Founders hardly know to set their expectations here, and the fact that there are no standard timelines for deliveries doesn’t help. Some agencies would need 1.5 months for a messaging process, we run a messaging sprint that is completed in the first month, in parallel to other activities. Some creative houses will need 6 months to complete a website, while others will be able to deliver (an initial and lean) website in 2 months.
The problem is that many times startup founders start an engagement without having full clarity over the deliverables and timelines, not setting deadlines upfront, as part of the engagement proposal, and then pay the price later on (literally).
Ask for a Gantt-style HL planning of deliverables and timelines – for the first months, so you have clear visibility.
Some examples of what to ask: How long does it take till we complete the messaging process? For the website to go live? To plan and release our out-of-stealth campaign? Complete the Hubspot implementation? See paid campaigns live and running? Analyze results?
We are asked about this a lot, and founders are always stressed to complete things as fast as possible. While vendors or professionals are not magicians, they should be able to meet the timelines that make sense in the early stage. I would say, no more than 3 months of preparations for out-of-stealth, no more than 2-3 weeks to complete the messaging process, and no more than 1.5-2 months for a new (slim) website, including the branding (unless you suffer from OCD), etc.
#7: How will we measure success?
This one is a bit funny. We usually ask the founders how they will judge our performance as an agency, and what will make them happy.
They can often provide answers that represent the effort of the entire company – such as getting to $1M ARR or closing 15 deals. I usually answer with humor “What about the IPO?”
Basically, we see the same issue once again – lack of knowledge. Technical founders know (usually) how to measure the productivity, quality, and performance of the engineering team, but they are lost when it comes to the right measure for the business units.
Measures for success should match the role of the employee or vendor, and in the case of marketing should include both qualitative and quantitative measures.
When you ask about measures for success, you should expect to hear answers related to both big data trends and trends related to specific marketing channels, such as – website traffic, engagement time, number of leads, and movement through the funnel.
You should also expect to hear answers related to qualitative measures such as deliveries against the deadline, and qualitative feedback from prospects (on the messages, materials, awareness, etc.).
Another KPI should be related to the service. How easy is it to work with the vendor/employee? How much attention is needed from your side? How fast do they get the nuances related to the product and the ecosystem? How responsive are they? Organized? Pushing until they complete the task?
These are all critical elements in the early stage.
We are also asked a lot about the reports that are provided and the insights generated out of the data and the numbers.
Question #8: What’s the time investment on my (founder’s) end?
This is a question that we are asked 100% of the time. Founders are busy and don’t have time to waste on endless meetings and hand-holding. They are very concerned with the fact that marketing will create additional overhead and many times even choose to delay kicking off the marketing operation due to these concerns.
Vendors tailored to the early stage should be built to this constraint and know how to operate independently. This has to do with the seniority and experience of the team (see point above) as well as their management methodologies.
For instance, our onboarding includes intensive learning of the product and ecosystem that we do independently. We also proactively build the marketing folders and connect to all the systems needed in order to access all data and documents on our own. We have methods to help founders approve activities and materials without them needing to dig in for the files, data, etc. we split projects into mini-tasks so the approval stages are much quicker and easier, we overview all context and suggest the next actions when there’s a challenge, and the list goes on – all designed to minimize the load on the management/founding team.
Question #9: What is your specific expertise in the early stage? Out of stealth?
Setting up the marketing DNA from scratch is not at all the same expertise as operating an existing infrastructure or even scaling it up. Founders often fail to understand the skills that are needed in order to create a solid infrastructure when there are no pillars already in place. Inexperienced marketers tend to underestimate the effort and expertise needed. The result could be painful.
Match your vendor to fill the gaps you have in the marketing unit. If there’s no infrastructure, search for someone who can fill all the needed gaps in both lean and agile ways. Ask for work examples in similar situations.
Time to seal the deal
An agile startup state of mind is crucial for establishing a successful marketing operation in an early stage – with its own unique needs, constraints, and challenges. The selected marketing team must have strong past experience dealing with limited budgets, determining market fit, uncertainty regarding messages and personas, lack of recognized brand, and more.
Lastly, the prospecting process itself will teach you a lot about the people on the other side and their ability to answer your KPIs in an optimal way.
Tsipi Joseph is a co-founder of G2M. She has been in the global tech marketing industry for 'oh so many years', dealing with technical products and services in almost any industry you can think of, including mobile apps, augmented reality, telecommunications, finance, medical, cyber and more.