Sales Innovation: The Power of Next Generation Sales Models

April 17, 2009

Blogger and Panel Moderator:

Mike Grandinetti

Senior Lecturer, MIT Sloan School of Management & Serial Software Industry Entrepreneur

Tech recession? For many of the iconic industry incumbents, unfortunately, and emphatically, yes. Although the software industry is only a quarter of a century old, it has gone through an incredibly fast paced and brutally Darwinian evolution.  We have accelerated through a number of aggressive sales models recently, including open source, SaaS and web- and cloud-based. Traditional models with large direct sales and support forces have created significant challenges across many dimensions for companies, including a high cost of sales per dollar of revenue and an increasingly elongated sales cycles, amongst many other issues. These challenges have been increasing for some time, but to some extent have been bearable in a buoyant economy. However, they have been exacerbated to the point of no return in the current economic environment.

However, many pioneers of the Sales 2.0 model have been experiencing very different results in comparison to the well known incumbents, including breathtaking customer and revenue growth, despite one of the most challenging selling environments in recent software industry history.

For example, Constant Contact (NASD: CTCT, http://www.constantcontact.com), an e-mail marketing services firm, (Tagline – Connect. Inform. Grow), reported exceptional FY08 results. Revenue grew 73 per cent to $87.3M, while the number of customer accounts grew 54 per cent to over 253 thousand.

Simple Tuition, (www.simpletuition.com), an online student loan site for both borrowers and lenders, (Tagline – The Smart Way to Chose Student Loans), saw 2008 revenue increase 600% year over year, while the number of leads delivered increased from 190 thousand to 750 thousand, or 500 per cent, in the same fiscal period.

Rapidly emerging inbound online marketing platform provider HubSpot (www.hubspot.com), has seen its business explode out of the gate in the most positive sense, in terms of new customers, bookings, revenues, etc. HubSpot’s year over year revenue increased by 360 per cent and the number of customer accounts increased by 6X to 1200.

A ’surprise’ special guest panelist, who has been a leader of not just one but two consecutive, extraordinary Sales 2.0 successes, saw his current firm’s revenue double on a very substantial base from FY07 to FY08.  In addition, it surged to number three in global market share in a very competitive market behind two very well established marquee brand names.

What do all of these companies have in common? Join us to hear from and interact with the CEO’s of these exciting businesses to gain a deeper understanding of how they have all brought together customer -focused methodologies and productivity enhancing technologies to transform sales from an art to science, while rapidly growing their respective companies in a very cash efficient manner perfect for today’s hostile fundraising environment. This panel will give you a view of the future of where the sales profession is very quickly heading – and an understanding of why leading VCs see this as the only truly fundable model for success going forward. For those of you not in software or service-based sales, there is still much knowledge to be gained. Historically, the software industry has been a leader in pioneering new models. For example, the open source software movement has led to today’s very exciting Open Innovation approach to product development, prevalent across all industries, including life sciences, medical equipment and consumer products. The software as a service (or SaaS) sales model has led to equipment as a service models with companies such as Optos, a business model pioneer and leader in the digital 3D optometry equipment market.

I hope that you can join us at the Hyatt Regency Hotel in Cambridge MA on 17 April at 1:30PM for a great discussion.

The early registration deadline is March 15th.  Please enter the code: “EarlyBirdSpecial” for a special 15% discount.

Thank you all and we look forward to seeing everyone on April 17th.