17:16The Better Customer–Startups or Big Enterprise?
From Y Combinator · Published Jul 21, 2023 · Watch on YouTube
TL;DR
Selling software to startups can work well (e.g., Stripe, PagerDuty, Gusto) but fails when founders mistakenly assume startups are easier customers, won't churn, or that a startup-targeted product naturally fits enterprise.
Key insights
- Founders who built a product for large companies (e.g., enterprise-grade dev tools) often try to sell it cheap to startups that don't have the problem, wasting time and missing traction.
- Selling to startups is not inherently easier; a customer without the problem is worse than a customer with the problem who takes long to decide.
- Startup customers can be just as high-maintenance as enterprise customers, but pay less, making support harder to afford.
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