How do you deal with a nonrealistic tech start up founder/CEO

Question

To give some background I started at this new brand new start up in the Fintech space 2 weeks ago.

Before I started here a good friend of mine started about a month earlier. I had some reservations before joinng due to his ludicrous revenue expectations that he had expressed to my buddy but according to my friend he had tampered his expations.

We'll now I'm here and boy waz my friend wrong. The average sales cycle is 30+ days and some how starting in the middle of a month I was expected to close multiple deals month 0.

On top of that there is a large disconnect between what he thinks the product is worth and what people are willing to pay given we only have less than 200 endusers at the moment. This is causing us to have to turn away revenue to then be hit with "where's the revenue." Even though on the smaller deals we’re turning away, the revenue per end user would be higher than the large deals he’s focused on that take months to close.

Any advice would be great appreciate!

Accepted Answer

That’s tough. Founders are their own worst enemy. They understand it so well and have convinced themselves of it’s necessity that they can’t even fathom anything in any fashion other than what they express.
1 - I’d build a sheet showing how many deals you won at the current asking price, and;
2 - have a row showing how many deals you turned away at a lower asking price.
Then map out MOM revenue and you’ll be able to see where the two axis cross and you’ll have your law of diminishing returns in the real world.
You’ll be able to say that:
1 - if you had sold everything at $10 a month instead of $49, based on the deals you lost, you’d surpass your current revenue in month 4.5 at our current rate of growth, and;
2 - you’d have X% more of growth with more clients at a lower rate, while increasing profitability due to scale.
Good luck, I hope it helps and keep fighting!

Answer

Is your logo positioned to be an Enterprise level solution? Have they done product and market fit homework?

Answer

With what you've said, I'd probably be considering my next move and looking for another opportunity.

Nikosuave

How do you deal with a nonrealistic tech start up founder/CEO

6 comments

Nikosuave

How do you deal with a nonrealistic tech start up founder/CEO

6 comments

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