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Why Start-Ups Fail With Brands And Agencies

Fail

Ninety five percent of the start-up pitches that I received while working a major agency, representing major brands, went nowhere.  Many of these start-ups had great concepts.  Most had one or two great components and many had very likeable teams.  In most cases these start-ups failed to generate meaningful traction with big brands because of a lack of meaningful solutions in three primary areas: resources, experience and delivery.

This post was inspired by Shiv Singh's fantastic Love Letter To StartUps on Ad Age.  Once you're done reading this post, sharing it with your friends and commenting, please have a read over at Shiv's.

RESOURCES

Brands and agencies look to build incredible experiences - both lifestyle and product related.  Brands and agencies are looking for great start-ups who will make their lives either easier or more effective.  

Working with a start-up requires that the brand or agency either (a) devote resources and investment towards setting up a trial, or (b) hand over a well earned brand to a unknown team and pray for the best.  As most experienced marketers are loath to do the latter and do not have enough of the former, the opportunity dies on the vine.

There is little that a start-up can do to solve for resource limitations at the brand or agency.  But when someone at the brand or agency asks the startup to assist, the answer should always be yes.

EXPERIENCE

When an agency brings a partner to their clients, or a brand manager engages a vendor for their projects, the agency or brand manager is putting their reputation on the line.  Every kid has to fall a few times in order to learn how to ride a bike.  Rarely does a first-time project go as planned.  Nearly everything an innovative start-up does for the first year or two is in some sense, a first.  A first time with a new team, a first time with a new platform, a first time with integrated analytics, a first time with new functionality, etc.  There is real career risk in bringing in an unknown or unproven partner.  Those individuals or teams recently burned by an unsuccessful project are unlikely to go back to the well with another start-up for some time.  

The other great experience divide is in process and implementation.  Start-up culture is to sell first, and then figure it out as you go.  This catch-up game does not mix well with brand and agency process, which are generally fairly standardized and rigid.  Traditional processes and timelines assume that the solutions are ready to go based on their pre-assumed timelines.  Print advertising and start-up innovation are very different.  This fairly fixed process and high expectation force start-ups to endure ridiculously fast turnarounds on development, and almost all development will have to occur out of cycle.  Without enough time to fully test the platform and little experience delivering a proven product at scale, there are 101 ways that everything can go to hell.

And even if lightning strikes once, rare is the start-up that can deliver the same quality of experience time and again.  Start-ups are about rapid failure, learning and innovation. Most brand marketers will not accept engineering glitches that stop their Facebook app from working while millions of dollars are driving users to the platform. It is generally not in the marketer's best interest to accept start-up development and learning on their dime.

Smart start-ups should try to bring on employees or advisors with proven experience building and implimenting very similar or parallel solutions.  This will often help manage both marketer's concerns, as well as project management alignment.

DELIVERY

Components Vs Solutions

Most start-ups have at most one or two limited, unique components.  Most marketers do not have the resources to manage or invest in components of solutions.  For example, I may love your platform for developing a Facebook Photo Contest.  Your unique visualization tool is stunning.  But you don't have experience or capabilities for managingFacebook Promotions Policy, Content Moderation, Legal Review or Prizing and Fulfillment.  Working with your component-solution would therefor require that we invest in at least two or three other partners, as well as project management resources to bring all of you together.  OR, I could just go to my regular roster or Facebook Promotions vendors and get something slightly less cutting edge.  

All-In-One = None-In-What?

At the same time, most start-ups are lightly staffed.  The all-in-one sales lead/relationship lead/project manager is a tough role to play and few do it well.  This causes innumerable headaches in either project management or miscommunication.  And remember, even if you (the start-up) did your best, if the project bombed for reasons beyond your control ... let's just say that communications is key.

Talented People Vs Talented Teams

With a small staff, there are often only one or two brilliant people driving the platform.  Sometimes they need a break.  The single brilliant developer that ran the first two efforts worked 80 hour weeks for three weeks straight in order to get both of those campaigns live.  He then crashed and burned and has opted to take a well deserved vacation or spend some time with his now 5 month old child.  But it's time for project #3 to go up.  Without Einstein at the helm, the end product looks like a kindergartner made it in Geocities.

The Bottom Line

  1. Great marketers build experiences.  Don't sell your start-up as a technology or as an end-to-end solution.  Sell the experience you can create for their business.  
  2. Ask questions.  The more that you ask, the better you can manage and meet expectations.  Listen, take notes and send follow up recaps of everything discussed.  
  3. Partner with the right agency.  Every agency or partner with a leg into a brand will try to pitch them on the next big thing - social, mobile, gaming, interactive tv etc.  Agencies are in the business of growing their revenues, and revenue growth is often driven by breaking off a bigger chunk of the pie - for example: moving from traditional PR to Social Media, and then from Social Media in Digital Marketing.  Set yourself up for success by evaluating the agency while they are evaluating you.  Do they have a culture that embraces newness and innovation?  Is there a capable technology team that you can be successful working with?  Do they have experience delivering solutions related to your own, or is this entire space new to them?    
  4. Become part of the team.  Invest in face time together.  Join the weekly status.  Don't let your insecurity limit your participation or drive you to "own" the meeting.  Act like a member of the team and you will be treated like one.
  5. Don't become another problem. Everyone has problems.  Nobody wants to hear about yours.  Coding is not a marketing activity, it's a marketing enabler.  Focus on what you are delivering and deliver it.  Try as hard as you can to avoid creating new challenges. 
  6. Don't act like a start-up. Forget the insider jargon or Valley talk.  Forget about your rounds of investing orcompany size.  Forget about the Skype or Hangout meetings.  Never host a WebEx from a Starbucks and then apologize for the noise or WiFi.  Participate in the business like you belong in the business. 
  7. Bring the right people to the table.  Try to avoid bringing your founder and lead engineer to an introductory meeting with marketing leads at a big agency.  Their pride will get in the way of the pitch.  When pitching theright agency of brand, consider - who is your ideal audience.  The marketing or media team may be the right place to start when you are selling an experience.  If your solution relies on technology integration however, be sure to get your technologists meeting with their technologists.  Let your technology people work with the technologists, and keep the marketing folks from getting in their way.  
  8. Change your process.  Try to adapt your processes and time-lines to your most important client's needs.  The more that you can learn to work within their standard project plans, the more agreeable the team will be towards reengaging your team for the next project.
  9. Focus on the goal.  Get over your last success quickly, because that's not why you were hired.  You were hired to build your next great success, for them.  Make it happen with every ounce of energy you have.  It will show.
  10. Stay positive, solve challenges.  Provide solutions, not problems.  Everyone has their challenges.  Don't be a challenge creater, be a problem solver.  Make their challenges go away.  Make their work simpler or more productive.  Make them enjoy their work more.  Make them more proud of their output.  Get them promoted or recognized in their industry.  It's not about your platform, it's about their business.  Make it yours.