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Don't buy from bad startups.

1. Startups have a high(er) chance of pivoting out of something you don't want. They aren't stuck selling you the same bloated database (or whatever).

2. Don't buy from startups that don't have a path to monetization and growth. If the path leads to no where. That's not a company, that's a resume bullet point.

3. Don't buy from a startup just because they're a startup. If they suck at service, they're not worth your time and money.

4. Yes, startups should fit to customer expectations. But if a big company's or govt's buying model prevents them from buying a superior product, then maybe something is wrong with the buying model. Govt buying decisions led to a $300M webapp. Marc Benioff offered to build and host it for free for 5 years.

http://www.washingtonpost.com/national/health-science/health... "A White House official said the administration could not have accepted the offer, because it ran afoul of federal contracting rules."

OF COURSE something is wrong with the govt/edu buying model (I worked at a college for 5 years). But I still think it's worth playing the game if that's within your target market.

Are you saying don't sell to them on principle?

Of course they should. Marc Benioff tried to sell to the govt. Govt couldn't buy it. Couldn't even evaluate it.

We're talking to several universities now to find the best way to serve them. Sometimes we run into structural road blocks. One school requires a printed hard copy form be sent between departments for processing. But we're still trying to find a way to make it work. Mostly because I'm hellbent on moving companies, schools, and governments from paper to digital.

> "Don't buy from bad startups."

Do you have a resource that can definitively tell which startups are bad and which ones are good?

If I did, I'd have already sold my Facebook and Twitter shares and sprinkle words of wisdom down upon the masses. Or become a VC.

But, if I'm a company looking for vendors, I evaluate "good" vs "bad" in the context of sustainability of the org. If they don't have a path to profitability and sustainability as a company, they're bad. If they do, they still may fail. But big companies fail too. I know no one gets fired for buying Oracle, but what are you missing if you ignore Postgres?

Postgres isn't a startup, it's open source software that you implement yourself. If the people currently supporting it decide to stop supporting it, then other people will (eventually) step in to fill the void. In the meantime you can keep on trucking with your working production code.

Rely on a startup and when it fails, the part of your business that relies on it fails with it.

All very true. This is why I find that companies tend to do best buying from companies of relatively similar size. GM and GE struggle with buying from startups for these reasons. The pace of change is too much. But they will buy from the startup after IBM has bought them. Startups are better off finding more nimble initial customers. Crossing the Chasm [1] is the best resource I've found on describing the challenges of startups servicing large companies.

The exception to this is parts of the company that are either specifically geared towards hunting new technologies, or subsidiaries/departments with lots of autonomy and shorter timeframes. Basically folks who are tasked with experimenting and moving on. Even then, it's a better fit with services (boutique ad agencies and investment banks supporting large firms) than products with lock-in.

[1] http://en.wikipedia.org/wiki/Crossing_the_Chasm

Regarding the customer service part, I'm not sure to understand what's the logic behind such a thought process.

When you're a giant corp, you can afford to be slacking on CS. But when you're a small structure with a limited amount of stability and cash flow, why would you take the risk to screw your PR ?

I'm biaised, I'm doing specialised tech support for a Giant so I it's obvious to me.

I've been looking to move to a smaller company (Ie a startup) and I found not so many positions, most being standard CS and nothing technical which is surprising. Might be because I'm in Europe though.

Counter-points

1. Pivoting away from revenue is pretty stupid thing to do. If you are buying from me, and so is Tom Dick and Harry, I am getting a strong market signal.

2. The team is so good they might get acqui-hired and you are worried your multinational company is now relying on them - well there is a solution to stop another company acqui-hiring them....

3. Customer service sucks most places. Some use it as a differentiator (Rackspace), but a lot of the time customer service should be automated (lost your password?). And "on-boarding" new customers by hand - this is gold that some startups are learning about

4. I will happily send you an invoice and set up a monthly billing run. It just won't be for 29 dollars a month :-)

But yes - I agree with your main thrust - we should make it easy and simple to get a yes turned into a paid invoice from a corporate budget holder.

Regarding 3: I agree many CS functions should be automated (lost password is a good example). However, for foreseeable future a lot of people want to talk to a human. This is especially true for services that touch sensitive or mission-critical data (money, infrastructure).

As an example: I love Stripe as much as anyone, but I find it extremely odd that a company that touches up to 100% of another company's revenue doesn't have a phone number on their support page [a]

Maybe I'm old-fashioned but I think there's more to it. At my company, at least, great customer service has been a cornerstone for us and a reason people refer us and don't leave us.

[a] https://support.stripe.com/

You don't build customer trust with good salesmen, you do it when you fix the issue they're having.

See Amazon.

See Amazon.

Assuming that was meant to be an example of good customer service, it's an ironic one. I'm increasingly voting with my wallet for local stores over Amazon for any big name items. This is mainly because Amazon's unpredictable pricing, including sometimes dramatically overpricing things for a while, is turning me right off trusting them or assuming that they'll be cheaper the way they almost always used to be.

Free delivery, we'll-call-you-back customer support, and a smartly automated returns process are all great, but they are still vastly inferior to being able to walk for two minutes from my home and buy what I want right now, and being able to return it just as easily on the increasingly rare occasions there is a defective disk in the box.

Between this kind of nonsense and a couple of years of getting Christmas wrong for lots of people, I'm not sure how much longer Amazon specifically will be able to rely on the good will they've built up over the years without a change in course.

With regards to 1 and 2, if I'm in charge of buying a SaaS app to run a small but important part of my big company's operations, I really don't want to deal with the risk you might change your mind if Tom, Dick and Harry turn you down, still less have to contemplate acqui-hiring your developers at $1m per head in future to ensure you actually honour the three year contract and SLA I asked for....