StartUp Founders: Second Order Revenue Drives Sales Scale

Name: StartUp Founders: Second Order Revenue Drives Sales Scale
Uploaded: 2023-01-04T21:02:43+00:00
Duration: 58 s
Channel: James Sinclair
Description: James Sinclair argues startup founders should focus on second order revenue: customers referring you or bringing your product to new jobs. It costs…

4 Jan 2023 · 1 min

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James Sinclair argues startup founders should focus on second order revenue: customers referring you or bringing your product to new jobs. It costs almost nothing, proves your product works, and beats paid marketing when you have no budget.

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If you're a startup founder, you need to start taking second order revenue really seriously. Second order revenue is when an existing customer refers you to someone else or they move employer and they take your solution with them. What better proof of the validity and value of your solution than an existing customer either referring you to someone else or going to a new employer and taking you with them? More importantly, no ad spend, no marketing spend, so your cost of acquisition is almost zero. It's all done through the value of your solution that you deliver to that customer and the relationship you have built with their customer so that they want to refer you, they want to use you again. And as a startup you need accelerated scale. You need sales, but you don't have the marketing spend to get in front of everyone this problem. You don't have the brand value that they know about you. Your existing customers are the greatest pipeline to your next customers. So work out what you have to do to make it easy for them to want to refer you. Good luck.