by Matt Niehaus
When I became CEO of Instore, an iPad-based point of sale solution for small businesses and restaurants, we didn’t have a huge pool of money for hiring top software engineers, planning extravagant corporate getaways, or spending millions of dollars on marketing. But even so, we’ve been able to successfully compete with bigger companies with big balance sheets and a head start in the market.
Here’s our underdog strategy to competing in the big leagues when you run a small startup.
Build a great product that customers love
The first and most important point? It’s all about the product. We correspond frequently with our customer base, paying close attention to their thoughts about our software. Then we strategize about what we can do to expand our solution to provide an even better experience for our customers while attracting new ones.
For example, when we discovered that our customers wanted the ability to offer and process gift cards, we partnered with a gift card printing company to give them a market-leading gift card program in time for Christmas sales. Making sure that customers are happy with our platform helps us save on marketing costs—20% of our business comes in from customer referrals.
Use guerilla marketing and sales tactics
We don’t have the budget to invest in big TV campaigns or to saturate the web with PPC ads. Instead, we focus on purchasing highly targeted leads, and developing a content marketing strategy aimed at attracting our target audience of restaurant owners. These approaches have helped us generate interest in the Instore brand and attract new customers without excessive acquisition costs.
Keep costs low so you can reach profitability with little capital
Rather than aiming for huge VC financing and all the pressures that come with it, we’ve kept our operating costs low, allowing us to become profitable quickly. We’ve focused on finding software engineers who’ll work for less than the $100,000+ going rate in our area; kept our physical team small while relying on external contractors; and avoided spending thousands of dollars per month on unnecessary technology investments. That helps us stay in the black, rather than burning through our capital and needing to raise funds or fail.
Create a lean startup culture
At our company, we’ve built a culture that thrives on overcoming challenges imposed by limited resources. We don’t have 100 coders working to solve problems and build new programs—we have just a few. Our team members closely collaborate to resolve issues and take pride in their ability to create a great solution for small businesses.
Matt Niehaus is the CEO of Instore, an iPad-based point of sale solution for restaurants and other small businesses. Previously, he served as a partner at the venture capital firm Battery Ventures, working closely with early-stage companies to guide them to success.
U.S. Army | Courtesy of Matt Niehaus