Reeling In the Big One
In retrospect, Patrick Wack admits, it was a pretty audacious move. In 1996, Wack and his three business partners marched into the J.P. Morgan building, a towering neoclassical skyscraper on Wall Street, and told executives of the financial giant that they needed to change the way they did business. Rather than relying on an army of foot messengers and FedEx trucks when sensitive documents needed to change hands, J.P. Morgan could do it cheaper and more easily via a secure site on the World Wide Web. And Wack's New York City-based start-up, IntraLinks, was just the firm to help them make the change.
IntraLinks had just five employees, no outside financing, and had not even completed its product. But armed with a PowerPoint presentation and some webpage mockups, Wack, then 29, and his three partners outlined their vision to bring the century-old institution into the Internet age. On Morgan's side of the table, listening silently, sat "a small army of technology, business, legal, and operations staff," Wack recalls. Then, one of the bank's managing directors stood up. "We've always prided ourselves on being innovative," she said. "We'd like to work with you on this." She left the room and let Wack, his cronies, and some junior staffers work out the details of what later became a $50,000 contract -- IntraLinks' first big sale. "We had been confident all along," Wack says. "But we were still surprised."
For start-ups like IntraLinks, landing a major brand-name customer is one of the biggest coups there is. Pull off the job, and the reward is instant credibility -- and an invaluable tool to entice other clients to open their wallets. "Those big reference customers bring in the little guys -- and it's rarely the other way around," says Joel Wiggins, director of the Austin Technology Incubator, which has helped more than 140 start-ups get off the ground. But how does an unproven and anonymous start-up win the attention and trust of a deep-pocketed corporate giant?
For Wack -- who built and sold a successful physical therapy company but had no tech experience before launching IntraLinks -- it was a matter of skillfully exploiting connections to create an image of competence. One of his original partners, Mark Adams, was a longtime Bear Stearns banker with scores of contacts in the industry. What's more, long before meeting any potential clients or even hammering out the final details of IntraLinks' product, Wack and his team spent months gaining the trust and support of key players in the tech marketplace. They learned, for instance, that IBM was getting into the application-hosting business and looking for innovative "showcase partners" with which to develop such technology. IBM became an early IntraLinks collaborator, and though the two companies hadn't yet signed a formal contract, IntraLinks was able to use the tech giant's name in negotiations.
Once IntraLinks was ready to begin selling, Wack asked his father-in-law's brother, a former J.P. Morgan bigwig, to help him set up a meeting. And the networking only grew more furious once the Morgan deal was signed. Within a month of landing the account, Wack and his partners convinced several top execs there to introduce them to managers at other Wall Street shops, including Bank of America and Deutsche Bank -- now clients. "Businesses put all this effort into getting a good product together, and it's not about products at all," says Wack. "People buy from people they trust."
Of course, not every entrepreneur is lucky enough to have such well-connected in-laws. For those entrepreneurs, there is always cold-calling. Josh Linkner, who started the online promotion agency ePrize in Farmington Hills, Mich., in 1999, says he spent nearly four months making 500 calls to corporate execs before he got someone to listen. Fortunately, that sympathetic ear belonged to an executive at Ameritech, then a large midwestern long-distance provider, who was impressed by Linkner's phone manner. That was enough to get an initial meeting. Linkner and his two salespeople put on their best suits and made a brief pitch. But mostly, Linkner says, they listened. Ameritech, it turned out, wanted to gather information about its customers, rather than simply bombard them with ads. Linkner had a brainstorm: Ameritech could capture data, as well as generate buzz, with an online contest that required participants to provide personal information to enter. "Eager business owners come in screaming their song from the mountaintops, but it's always better to get the customer talking," Linkner says. "You should listen at least twice as much as you talk."
Linkner's project -- a sweepstakes to win a Porsche Boxster -- proved so successful that the Ameritech exec allowed Linkner to use his name as a reference for other jobs. In fact, Linkner added a case study about the campaign -- including an enthusiastic quote from the Ameritech exec -- to his marketing materials. It became part of his broader sales strategy: Don't just make your clients happy -- turn them into "raving fans." Now, every piece of ePrize's marketing material wears the badges of his biggest clients -- blue-chip corporations like General Motors, CBS, AT&T, Domino's Pizza, and MasterCard. "We come in with a huge amount of credibility," he says.
Cold-calling, while never easy, becomes somewhat less onerous once you learn that decisions about whether to sign up with a vendor are not always made at the top. Mid-level managers often have considerable independence and clout. Jeff Cronrod learned that in 1990, when he launched Fidelity Information Corp., a debt collection and tenant screening service based in Pacific Palisades, Calif. Sure, he'll never turn down the chance to chat up a CEO, but he encourages sales staff to cultivate relationships with middle managers. Competitive pricing also plays a role. While wooing large clients, Cronrod is not shy about giving away free or dramatically discounted services on a trial basis. The way he sees it, it's an investment in his company's future. Some prospects, he says, get as many 100 free tenant screens before being pressured to become paying customers. "We believe, without question, that if you let someone use your service for free, they'll end up using you in the long run," he says.
Play your cards right, and you might find that the tables have turned. Remember IntraLinks? With clients including major Wall Street banks and several large pharmaceutical firms, the company now has 170 employees and revenue of more than $25 million. In fact, Wack now finds himself being approached by small, unproven start-ups looking to land their big sale. How does it feel to have the shoe on the other foot? "I've got a soft spot for people with good ideas," Wack says.
Selling to the Bigwigs 101
Use Your Connections
Linking with the right people can give a big boost to your credibility -- and help get your foot in the door.
Aim for the Middle
Mid-level managers are more accessible than top execs and often have more clout than you think.
Give It Away
Offer your service for free or at a deep discount. Do a good job, and they'll be happy to start paying.