In 2009, when we first founded Datahug we did not know many other founders, investors or mentors who could help with advice or introductions to customers or investors. Equally, when we did manage to get that rare early introduction or connection, we had very little validation or credibility in the market to convince people they should trust us and work with us.
We had a huge access and credibility problem.
The Access Problem
First time founders usually don’t have strong networks in the startup ecosystem. They simply don’t know any experienced founders or mentors who can help with valuable mentorship and introductions to potential customers, partners or investors. They often have to build new networks from scratch, which requires an awful lot of energy, time and luck.
B2B founders especially know that relationships are everything, and that the right introduction at the right time can be a game changer to help them build momentum.
The Credibility Problem
“Hi, I’m Connor from Datahug” – “Sorry who are you? And what is a Datahug?”
In the beginning, customers have absolutely ZERO reason to trust you. Let alone even take a meeting from you. Enterprise customers are also very conservative and risk averse when it comes to working with startups they have never heard of and who have mediocre customer references.
The Magic of Techstars
Since joining Techstars as managing director of the SAP.iO Foundry, Powered by Techstars Accelerator earlier this year, I’ve had some time to think about how we overcame this at Datahug and how I believe the Techstars Worldwide Network helps entrepreneurs succeed.
Techstars helps by:
- Engineering Serendipity by surrounding early stage founders with 100+ mentors when it matters most to their early growth and success.
- Lending Credibility by allowing founders to leverage their Techstars brand association to help our companies build early trust.
I call these two advantages, Hello and Halo.
Hello World – Tapping into Mentor Network Effects
Relationships are everything. A common fallacy in enterprise SaaS in particular is that businesses buy from other businesses. They don’t. Instead, what really happens is that a person (Mary) at Company A buys something from another person (Ingrid) at Company B.
Therefore, it should be no surprise that building relationships with early customers, partners, investors and potential hires is one of the most impactful activities B2B founders can do. This is why at the core of every great accelerator program is a strong and experienced Mentor Network.
At Techstars, we believe in the power of mentors so much that we have built our whole accelerator model around Mentor Networks. Within the first month of any Techstars program, our founders experience what we call Mentor Madness. An intensive 3 weeks where our teams have up to 100 1:1 meetings with mentors from our network who can often help with advice, introductions, sales or investment.
Typically, it could take a founder years to meet so many highly supportive mentors who have a #GiveFirst mentality (people who ask ‘how can I help’) and genuine experience in either a specific domain that is related to the founder’s company (whether it be potential customers, angel investors, or experienced founders who’ve experienced and overcome the same challenges facing your startup).
Access to these mentors is a game changer for our companies. Founders typically build networks and insights that would have taken them two years to achieve outside Techstars. By helping engineer serendipity and hundreds of warm ‘hellos’ we help our companies #DoMoreFaster.
The Halo Effect – Standing on the Shoulders of Giants
“Hi, I’m Connor from Datahug. We are an SAP.iO and Techstars backed company” – “Hi Connor. Interesting as we are a SAP customer… or we have invested in Techstars companies before…”
This is nothing short of a game changer. If you have ever done sales, then you know the importance of reference customers or brands to help establish trust and early rapport. At Datahug, when Salesforce invested in us they brought us no real clients or direct deal flow.
Instead, they gave us huge credibility in the marketplace and really helped us ‘earn the right’ to pitch and ultimately convert more contacts to leads and eventually more customers.
As we built momentum and secured more global brands, we then expanded our pitch to include things like “We also work with Deloitte, Qlik, Optimizely, Silicon Valley Bank etc…” It’s why you always see client logos plastered over every SaaS companies website or investment deck.
Ultimately, founders and investors know that logos and brand association matters. Credibility matters. Techstars and SAP are probably two of the biggest global brands in venture capital and enterprise Saas respectively (in fact, SAP is also well known in the VC industry through its Sapphire and SAP.iO funds). Not a bad resource to have on your side!
So, Do You Want to Say Hello/Halo?
If access and credibility are important to your B2B SaaS company, then we’d love to see how Techstars and SAP can help you succeed. You’ll still need to have a great team and proven ability to execute and deliver.
We are very protective of our mentors’ time and brand equity, but once you are in Techstars, you are in for life. We call this #TechstarsForLife. That is why we love working with strong teams who we know can leverage our network effectively and will be great brand ambassadors for Techstars globally as a proud alumni.
If you want to learn more, then I’d encourage you to apply – the SAP.iO Foundry, Powered by Techstars Accelerator is now open for applications.
Our deadline is June 18th and we encourage you to start your application early so that we can get to know you well ahead of our selection process (we review applications every few days and often reach out with questions – this is a great way for us to get to know each other more ahead of selection).
We are also hosting an AMA and Webinar on May 22nd where you can learn more and ask us any questions you might have. (If you are reading this after the webinar, check out the same link for the recording).
Connor & Sanah