The Enterprise-Startup Chasm

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If you’ve worked in a startup before, you have likely read or heard of the book, Crossing The Chasm by Geoffrey A. Moore. The book outlines several fundamental principles about marketing and building a scalable company that can reach larger audiences, helping to bridge the Enterprise-Startup Chasm.

The book centres around the “Technology Adoption Life Cycle” which is a diagram representing how customer audiences generally adopt a new technology.

Technology-Adoption-Lifecycle

There are several “chasms” in which companies have to jump in order to reach the next set of customers. The two most important ones are: Innovators to Early Adopters (from the blue to the red) and then “The Chasm,” which is Early Adopters to Early Majority.

For this article, I’m going to reference Yesware, an email sales tool for Gmail designed to increase sales productivity and optimize sales emails through tracking.

 

Yesware

 

The First Chasm

Yesware was founded in 2010 by Matthew Bellows, Cashman Andrus and Rajat Bhargava. They created a product and began building the company, targeting the Innovators. In order to reach the Early Adopters, they needed to secure innovators and seed funding.

Only a year after they started the company, they announced the finalization of their initial seed round. The round, backed by Google Ventures and others, helped solidify their credibility to the market and ensured that the company would continue to operate into the foreseeable future. During this time, they worked on ensuring their product produced results and demonstrated how it could help others.

The Second Chasm

Following their initial funding period, it took only another year until they secured their Series A funding. During that time they focused on building their product and making it work with other systems. The second round pushed the company through the chasm into the early majority. Following the financing round, they recently announced that they reached 200,000 users and more features. Now you might be asking, so what?

Consumer vs. Business

The difference between the consumer focused startup and the business focused startup are the way they must build customers and how they scale their business. Business needs are significantly more rigid than consumer ones. In the world of enterprise  and B2B marketing there is no viral marketing, there is only results. And the product must produce those results.

A great example of business rigidity is the integration of Salesforce into Yesware. The integration is not a coincidence, nor was it likely intended when the company was founded. Virtually all sales focused organizations use Salesforce as a CRM and as the blog post demonstrates, it’s a workaround solution for both companies.

While crossing both chasms, Yesware needed to adopt their product in a way that matched the current business environment. While many companies are switching to cloud solutions, those products have to be taken into consideration when it comes to building an enterprise business.

There are two main things to consider when crossing both “chasms” as an enterprise startup

m_chasm_sf

 

 

The first Chasm:

You need to demonstrate that your product produces results

The second Chasm:

You need to make your product work with other business systems

 

Both of these are also dependant on the company securing the necessary funding to continue building their product. But these factors are essential to keeping the product relevant to the company’s customer base. In a nutshell, these are two basic principles that can help companies get through the challenges ahead.

 

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About Author

Kenneth Loi

Kenneth is Chief Operating Officer and Founder of Procurify and oversees several business divisions including Operations, Product Management and Customer Relations. Kenneth's vision is to assemble the dream team to help build an enterprise product that helps solve critical business problems yet is intuitively easy to use.

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