David Friedberg's weather-risk startup spent its first year cold-calling construction, farming, travel, and energy companies, but had only a proof-of-concept, not a real product. The team spread thin across multiple industries, nearly closing deals with travel agencies and ski resorts, before realizing they needed depth in one market, not breadth across many.
Chapters
In that first year, after no one came to the website to buy coverage, I was sort of along with the rest of our early team of endeavorers, pioneers, cold calling businesses in all these different industries, like, why aren't you buying? So hey, Mr. Construction Company, doesn't it cause delays in your operations when it rains? Or hey, Mr. Farmer, if there's a freeze, you're going to lose your entire citrus crop. Right? And you start to end up in these consultative dialogues with these potential customers. And cold calling was something that I would say is sort of a critical, something you shouldn't be afraid to do if you're dealing with customers, because you're going to have to do it to understand what your customers want. So through this process, we realized, well, there are people that want this and we're able to close some sales, but every single one of them we're having to say, well, tell me the weather that affects you. And then they give you a whole story, then you do an analysis for them and then you run the price. So we were using our own website to sell products to people that wouldn't go to our website because there was a whole bunch of hand holding and positioning and the technology worked. But at the end of the day, we hadn't productized yet. We clearly just had a proof of technology. So the next year we ended up being, what was the guy at Yahoo. Peanut butter. We were like spread very thin. So we were trying to sell into all these different markets. Travel companies, energy companies. How do we make this thing work? Can we get travel companies to give rain free guarantees to all their customers? Negotiations, getting on planes, flying back and forth, meeting with all the online travel agencies. Well, we almost got a deal. We're almost there. That's not really going to work. So we've got to back off of that market. Ski resorts. Can we get all the ski resorts to buy? Well, we make snow and people will show up and we'll make money other ways. So we learned a lot about customers in different markets, but we didn't get deep enough to provide a solution to a customer in any given market.
