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The company I worked for had a pretty much identical experience with Unilever: they aggressively reduced the scope of the contract, but expected all the extras anyway; then at the end of the contract made the company choose between getting paid for all the overages, or extending the contract. They never even really needed us if you ask me; we were primarily used as a tool for one group of execs trying to one-up another group who was backing a competitor. Eventually it all lead to us having to integrate with that competing company... until said competitor suddnly went out of business (helped by their Unilever deal, no doubt). Of course the management's objective was keeping them as a client at any cost because having them as a reference would open up so many opportunities (it didn't really).

It will come as a surprise to many people, but it's quite possible to lose a ton of money on a toxic client who is paying you millions. Avoid such "white elephant" clients at any cost. And really, the last thing you need in your life is getting dragged into some huge conglomerate's internal politics.

I never worked with Singapore Airlines, but people who have experience with them tell me they're even worse in the sense that they allegedly have a policy of not paying for software - you get to give them free stuff in exchange for being able to list them as a client. Huge software companies can afford to do that; your growth stage startup probably can't.

Hah, a past SaaS “big startup/small enterprise” company I worked for also had Unilever as a customer, and they were also arguably our worst, most toxic customer. Constantly draining the time of everyone they interacted with. Managed to convince our execs to build a number of custom features just for them, that we spent a huge amount of time on, and they never used them (nor did our other customers).

I've encountered similar time-wasting behaviour with large companies, although not specifically Unilever.

In most cases I don't even think it's malicious: just that if you work somewhere in the middle of a giant corporation you forget the value of time. I suspect this is perhaps because it may take you years to deliver value for any initiative or project (assuming you can do it at all). Whereas smaller companies might be able to deliver the same value for themselves in days, weeks, or months so there's always this sense of momentum and urgency.

This is related to another theory I have about large corporations which is that if you work for them too long it robs you of initiative and possibly even makes you become stupid. Again, there are doubtless parts of these companies where this is more or less true, and possibly even some where it doesn't work this way at all, but I've had to deal with too many mid-level employees at large corporations now who simply can't get anything done, can't think for themselves, and for whom even the most basic of tasks can drag out for months. (It gets frustrating endlessly having to spoonfeed and restate next steps, and correct misunderstandings and misinformation.)

I realise this is quite a jaded view so I'd be happy to hear counterpoints.

I think this is the natural destination of bureaucracies, because the entire point of a bureaucracy is to reduce risk by creating a documented process for anything you could imagine wanting to do, leaving employees with no opportunities to think for themselves or be creative. So they just get to work, watch the clock, mindlessly follow the rules, and then go home. I suspect the lack of imagination required to work such a job draws people who prioritise stability and predictability over creativity.

I've worked at a small company constantly chasing large customers. Let's say a middling customer deal was $50k. Pretty much all profit. A large customer deal would be $500k, and need $500k of very specific technical-debt inducing bespoke dev work. I didn't know why they didn't grow the number of $50k deals!

Actually I know why. It was the "If we can get walmart it'll lead to much more" mentality (but not walmart but similarly big clients).

Also the $500k deals took a long time to land. When budgeting, whether the company made a profit or not would depend on a top salesman landing such a deal, or not.

What I notice is with larger deals and tenders the world was more cutthroat, the competition was more fierce etc, a lot of the "value" was from negotiating contracts and arguing over deadlines and shit, not actually delivering a product.

Sounds like where I ended up. We had a moderately successful company doing a lot of ~$100K deals and once we became financially sustainable we merged with a supposedly larger company in a complementary field with a view to accelerating our sales and getting access to a larger and more experienced tech team.

It turns out that they didn’t care at all about our regular little deals - the sales lead bragged to me once that he didn’t “get out of bed for less than $1M”. Long story short they spent all their time chasing much larger deals, but landing far fewer of them, and like your experience, the bigger deals are more complex and expensive to service. It was all driven by ego instead of logic, and it ended pretty badly.

I worked for a defense contractor that turned their nose up at $200M NASA contracts. Then after shenanigans from an unrelated division of the parent company all the big contracts started to dry up as punishment.

I had two of these moments, both with former top 3 tech giants (they were both far removed from the top by the time we talked).

The first gave us all sorts of access to their products first, presumably to see how our product would utilize them. And we used this as selling point to customers, not recognizing that we were kind of doing advertising for that other company as well as removing a barrier to customer acquisition. Nearly eight months in and that relationship petered out.

Second was more exciting. They came in loud and excited and had recently made some 9 figure acquisitions. They wanted to move quick so they started some technical evaluations. Tons of questions, requests, ideas, meetings, handoffs, etc. After four months of this we kind of got sick of doing their bidding without any timeline for how the process might go. After pressing a few times, they went cold. Our assumption was they were initially interested in a deal but moved into make-it-feel-like-we'll-be-family-soon-so-they-share-way-too-much mode.

I believe the second group was intent on just replicating what we had but I watched them closely and nothing materialized. I suspect given the resources they devoted the project collapsed there or was repurposed to a subsidiary.

Beware of the customer that kills the company...

I wonder if there are any gropus out there anymore with the intention of becoming successful by making good product for users, serving the client? I read articles like this, stories like yours, talk to startup owners recruiting who answer "Sold to someone." when you ask them "Where do you see your company in 5 years?" and I have doubt the product and users are in focus. And organizations proud themself being series n founded next to or before the success of their product (which many time is just missing in fact). Seems like product and users, the functionality is an unavoidable circumstance only, one of the many, something to consider like office space or tax returns. I don't know why but somehow the Boeing story comes to mind, how they shifted focus from engineering to business in the passenger plane line when McDonnell Douglas managers bought themselfs into Boeing management with Boeing's money. And the 737 MAX.

I think the nature of the startup world where you shoot for the moon to be unicorn or get bought out... or bust, leads to an all or nothing approach.

From the other side of this, if a company has been charging you $20 for something, why are you suddenly going to pay $100 for three times as much?

Working for places that are trying to do what your company was trying to do is how people get burnout. Congrats on the external perspective. Most places don’t get that lucky. Sunk cost fallacy and all.

Stay with the companies that are your size, until you’re big enough to land the big fish. Then charge them the same as you charged everybody else. If you lock the biggest fish in at an unsustainable rate, how do you intend to make up the difference on volume?

Sometimes it isn't about the "big sale" but having the big company on your list of customers. It can give your company a lot of credibility.

I don't doubt it for a start up... but I also wonder what value that is vs. 18 months of work and turn that into a deal that is really a loss, and the customer struggles to use the product ... and now you've got a big dominating customer who is going to continue to eat up time ...

I wonder how many profitable customers could be had in that time.

I've lived situation. Large co bought one of our systems, as their internally built systems weren't up to the task. We sold it at effectively break even. This was in part due to my business partner's view that we could turn this into a bigger deal.

Well, no. We couldn't.

The "customer" wanted specifically to see how we did what we did, in order to copy this. It took me a while to figure it out, but I did, and we wound up walking away from it. Partner was angry, but it was absolutely the right business decision to terminate the interaction.

PSA for any small startup firm with real differentiation: BigCo will, absolutely, positively will, try to see if they can replicate your value on their own rather than buy from you. Patents won't stop this. Pretty much nothing will, apart from an architecture and implementation that they don't understand. They will mess with you. Approach with extreme caution, and be prepared to cut bait quickly.

I used to say that our customers were our biggest competitors. You have to execute 10x better and be ½ the price if you want them to buy your product rather than replicate it. Or (better) you have to know something they don’t — and keep it to yourself.

>Patents won't stop this.

Can you elaborate? Is this because they'll infringe anyway, then use their big legal budget to game the system?

My guess is basically yes. Once they copy your small startup features and you go bust, what is really left to do? Spend an inordinate amount of time and money that you might not have chasing some compensation? How feasible is that.

Small companies that go bust have their assets acquired. That includes patents.

Corporate parent trolls eat them up and sue.

There are publicly traded companies whose sole means of profit is patent law suits.

They aren’t really your customer if they aren’t either paying you or otherwise hinging part of their own success on your product.

They used the product (in our case). They just asked for things that no one has wanted since.

I don’t think credibility is the right word. I agree that a well known customer can help the sales process up to a point. But I f you are in a b2b business and you have 100 customers on your books then having a name-brand customer is probably not that important.

In fact, if you have 100 customers on your books then it’s likely that customer number 101 has heard of many of them even if the regular guy on the street has not.

That one big customer - especially if it’s an early one - can really screw up your relationships with the customers that actually spend money with you - and what happens to your credibility when they quit?

Small customers give more credibility, they cannot waste money and your product must deliver value.

That logic sounds great to other small customers. It holds little water for the larger enterprise evaluation, in my experience.

Amazon (often) demands a year of free service from a vendor, and requires an NDA and charges a fee to cancel the NDA so you can claim them as a customer

Except Wal-Mart generally would not allow their name to be listed as a user of the product either.