The manner in which start-ups sell their technology into large enterprises has changed, according to a US entrepreneur.
Arun Agarwal, CEO of venture-capital backed storage software firm Infinio, said that the days of playing golf with a CIO in order to get some business are long gone.
“The old model to selling to large enterprises, and you can include government in that too, was really the ‘play golf with the CIO’ strategy,” said the Harvard graduate.
According to Agarwall: “The CIO would tell his executive VP of infrastructure to tell his executive VP of storage performance (the actual guy who has to do the work), to go try this product.
“You’d go through this chain and align the stars in order to get a deal done. That’s the traditional model of enterprise selling.”
The new model of selling involves making a product that can easily be tried and tested by the end user, said Agarwall.
If the end-user likes it then they will try and persuade the CIO to give them some funding so that the technology can be more deeply integrated into the enterprise.
“The initial deals are kept small so you don’t have to go all the way up the chain,” said Agarwall. “Then you’re in. You’ve made someone’s life better and you’ve got a foothold of the account. That’s a much better position to go up the chain and expand.
“By way of example, Infinio, we’re a really early stage company and we’ve been shipping the product for just over two quarters. We have three global Fortune 500 accounts and it’s because of this strategy.”
Agarwall believes that the new model makes it easier for start-ups to sell into enterprises. “Now distribution is mattering less and less as you can increasingly appeal to the folks who do the work."
Boston-based Infinio has a handful of European customers on its books but none in the UK yet. However, the three-year-old company hopes to change that later this year when it expands its business operations to London.
Agarwall said: “We absolutely want to be in the UK. It’s a great market for us.”