When a customer is going to spend more than $100k, they look for a relationship to minimize risk. Golf and similar activities are what the buyer demographic does with their friends.<p>Do people really think that customers that sign up for $10/mo "to-do" apps are more sophisticated buyers than enterprise customers?<p>In my experience, many people who complain about the enterprise sales process are failing for their lack of real domain expertise not their distaste for "schmoozing." They are also usually underestimating the intelligence of their customers and unwilling to build relationships.<p>Disclaimer: My companies do enterprise software.
Edit: I've also played golf exactly once in seven years since we started.
How does this apply to subscription-based models? I'm guessing that the valley of death bounds change when you're talking about monthly recurring revenue.<p>If most managers can approve a $5,000 purchase without much hassle, what's the magic number for monthly subscriptions? Is it $5K/12? Higher? Lower?<p>Also, with subscription-based sales, you often have the opportunity to sell more plans to the same organization if your product solves their problem. Is there some magic number that people have experienced here? If it's proven by one business unit, can you get enough "grass-roots" support to equal something close to $100K/12? That would be nice because it cuts down on the timeline of the initial sale and is a natural way to recruit internal champions.
I vowed after my first startup never again to build an enterprise product for this reason. Plus I don't like golfing and drinking with some random guy in Omaha trying to convince him my product solves one of this top three problems.
The #1 question to ask when selling to the enterprise is, "What are the spending authority cut-offs?" Nothing means more.<p>Funny, in my experience, the 5K and 100K numbers are pretty accurate.<p>I recently assisted in the purchase of business intelligence package. The CIO (my contact) had authority to spend up to $100K. Anything more had to go the board, and that "just wasn't going to happen". One vendor knew what to ask and bid $93K. The two others were much higher. Guess who (automatically) got the sale. The other 2 may have been better, but we'll never know. They were effectively eliminated by rules they never asked about.<p>At the low end, almost everyone has authority to spend up to $5K, even users. They bring in desktop software or SAAS under IT's radar. There's <i>huge</i> demand for solutions to their problems that fit under their spending limits.