When most people think of what makes tech companies successful, they think of new technical innovations like powerful new mobile apps, or new AI capabilities or cloud-based applications. Its true that technical innovations like these have spawned billion dollar industries, but it took much more than just cool technology to make that happen.
After 25 years as a technology executive at many successful tech companies, I have come to conclude that its not the technology that makes tech companies successful, but it’s the go-to-market (GTM) approach that brings this technology to market that ultimately determines success from failure. And I have decided to start a new business called Rocket Scale that will help tech companies master GTM and scale like a rocket to new heights.
GTM is the process of efficiently delivering a needed solution to its target market.
Most people think of it as the Sales and Marketing strategy since it involves distribution. But the “needed solution” part of the definition brings product into the center of a GTM strategy. If you have the wrong product for the market you are attacking, i.e., its not a “needed solution” then even a world class GTM team won’t be able to scale it into a large revenue stream. This is news to most product leaders, who like to view product as a more independent entity that works with sales and marketing where needed but largely focuses on the technical aspects of product development, releases and maintenance.
SaaS companies in particular have highlighted the importance of product within GTM plans because customer acquisition is just the beginning – most SaaS companies make the bulk of their revenues on upsells and renewals. And customers that are unhappy with the product they purchased from a successful GTM acquisition plan will not renew or purchase upsells. So the product needs to fit the market requirement in order to scale. This is often called product-market fit, and is an essential part of a GTM plan (more on that in future blog posts).
This might seem obvious, but you would be surprised how many smart people in Silicon Valley forget this, and think new innovative technology can “sell itself.” It doesn’t happen.
If You are Not Growing, You are Dying
In the tech world, its all about rapid growth. If you are not growing fast, you are dying because another competitor is likely growing faster than you and will ultimately wipe you out. There is no such thing as an exciting slow-growth technology company. Fast growth is the proof that your technology is truly earth-shattering. GTM is the vehicle that delivers that growth.
In spite of this, you won’t hear much about GTM in Silicon Valley. It involves mundane but critical tasks like effectively targeting a market, getting customer feedback to product for future roadmaps, developing a value proposition that addresses the prospect’s business needs, building a marketing machine that efficiently targets, generates and qualifies opportunities, and building a sales team that can not only close accounts initially, but see that they are happy over time so that they buy more in the future.
Its not as sexy as new technology, but no tech company would be successful without the right GTM approach. And plenty have failed because they could not figure it out – cool technology or not. Palm (Palm Pilot), Segway, and Netscape, all had ground-breaking technology but ultimately failed because their GTM plans could not deliver consistent growth.
Even successful companies can fail at GTM with new products: Amazon’s Fire phone and Google Glass are examples of cool technology coming from industry leaders that couldn’t nail the GTM and did not gain traction.
Technology may be the heart of Silicon Valley, but GTM is the rest of the body. One without the other won’t get very far, even if you have the market clout of Amazon or Google. And most companies don’t have that advantage.
An effective GTM plan ties customer needs, competitive and market dynamics back to the product and technology. The iPhone has super cool technology, but how popular would the iPhone be without over 2M apps that can run on it? That’s not a technology play, but a brilliant GTM move to build a platform that helped launch the mobile revolution and left early mobile pioneers Nokia, RIM and Motorola in the trash heap.
What Got You Here Won’t Get You There
One other challenge with a GTM engine: they can work like a charm up to a point, but then start to sputter as the market changes, new competitors emerge, or a target market segment becomes saturated. What worked to get to one level of growth e.g., $100M in revenues, probably won’t work to get you to $500M.
To keep the GTM wheels turning at high speed requires constant attention to pricing, sales models, marketing mix, messaging, product roadmaps and more.
This blog is dedicated to discussing all aspects of GTM so that it can get the attention and respect it deserves. Join me in the discussion!