Originate More Deals

Business developers like to compare their deal pipelines to giant funnels. Into the top of the funnel, you pour your new investment opportunities. As the funnel narrows, you engage with the deals that meet your investment hurdles and have the highest probability to close.

Often business development strategies focus on the top of the funnel: the leads that a company is collecting. Most strategies have something to do with widening the funnel or the volume of leads that are going in. These deal referral leads can come from in-house lists, purchased lists, online directories, and are driven by business development activities.  The main goal of these strategies is to invest resources to drive volume at the top of the funnel.

However, ask any seasoned BD professional and they will tell you of the horrors that can be created from just focusing on increasing the number of new deal leads.  That is it creates much more work to separate the quality deal leads from the duds and shepherd the good and actionable deals through to closing.

Business developers are becoming increasingly aware of the drawbacks of this model and the execution bottlenecks it can create.  The digital age has made it easier to get in front of more eyeballs, and collect more inbound leads in easy-to-use CRM databases. But so far it hasn’t done as much to smooth or streamline the midpoint of the funnel.

I advise today’s technology enabled investment professionals to focus not just on increasing the volume of new deal leads, but on the quality of the leads which is directly correlated to the quality of the referral source.  And one popular social media platform has made it a lot easier.

Using LinkedIn to land (and keep) referral sources and deal leads

Since its inception, LinkedIn has grown from just another place for recent grads to post resumés to the de facto social network for businesses. LinkedIn’s ad services are prized for how precisely they can be tailored to clients by sector and demographic. They tend to turn up leads of more consistent quality than purchased data lists and online directories.

Now the platform is adding Lead Gen forms to make the process of converting leads even smoother. This is a game-changer for business developers; by instantly populating a custom form with a LinkedIn user’s information when they click an ad on the site, Lead Gen forms eliminate the need for a landing page that users need to fill out manually.

This helps make the process of collecting lead information as smooth as possible. As soon as a potential customer clicks an ad, their information can be collected and added to a database as a potential lead.

LinkedIn’s ad services are prized for how specifically they can be tailored and served according to metrics like sector, location, and even position, increasing the likelihood that they’ll be seen by someone with decision-making power. But no matter how well an ad is targeted, the click-through experience can often keep a business developer from capturing a prospective deal referral source’s contact information and reason for inquiry which can further help screen to actionable deal flow.

Every click a conversion

By automatically populating a form with a visitor’s data, LinkedIn has eliminated the need for a manual form. Instead, every click on a sponsored ad becomes a conversion, collecting quality information that staff can use to follow up, nurture a relationship, and eventually close a deal.

Requiring a busy executive to manually populate a form can be the kiss of death. Sponsored ad campaigns that require customers to fill out their information manually are a drag on a conventional keyboard, and they’re even worse on the tiny one on your smart phone.

LinkedIn has added a powerful addition to an already effective tool. Business developers who used LinkedIn’s ad services are already paying to attract clicks and hoping that with enough exposure, they’ll have a decent conversion rate.

With Lead Gen forms, every click is a conversion, which causes the overall cost-to-convert to drop. Some business developers have been able to successfully reduce their costs per conversion to 10% of what they were previously, but even more modest reductions mean significant savings that can be allocated to other areas of business development.

How to set up a Lead Gen form on LinkedIn

The process of setting up Lead Gen forms is simple, and offers some useful features. When creating LinkedIn Sponsored Content, you can choose whether you want the ad to redirect to a landing page or other content, or to collect information for a Lead Gen form. The forms are customizable, allowing marketers to select up to seven auto-populating fields, making it easy to collect only the information that’s most relevant to your team. And customized messages add a convenient way to call people to action.

When potential leads click through an ad, they’ll be shown the form, its fields already filled out with information sourced from their profile. All they have to do is press “submit.”But where does the information go? LinkedIn stores responses in a database format that syncs easily with many CRM applications. From there, it’s ready to be integrated into your outreach program and prioritized more appropriately than before.

By the time a business has gone to the trouble of selecting a target demographic and crafting a sponsored content campaign, it shouldn’t have to worry about additional costs to convert. Lead Gen forms are an easy and effective way to improve this metric.

Amazon wasn’t even profitable until 2015. Fueled by the bold vision of its CEO, Jeff Bezos, the company spent a lot in its early days to build a future where the company could dominate.

Today, it appears the vision has been fulfilled. The company’s continually explosive top-line growth has finally led to a very profitable bottom line.

Still, in the early days, Amazon had to justify its spending to investors and even other team members, who had concerns about high operating losses and financial sustainability. This is a common conflict many businesses have to continually address.

Within any organization with a budget, there’s bound to be issues between expenses, revenues, and profits and losses. Here’s how companies can prudently balance business development and investment with expenses:

Understand there is no one-size-fits-all approach

As noted in a guide published by the US Small Business Administration, “managing the finances of a growing business requires persistence and balance.” There is no one right approach, not only because each business’ needs, goals, and situation are unique, but also because we live in a world of uncertainty.

After all, macroeconomic forces can alter business plans. Internal decisions about how to use resources can also change with the times.

With that said, companies should unite teams around a common goal: growth and development. The strategy, and how fast it accelerates the business, depends on the proper balancing of opposing forces, one in which financial leverage, sales growth, operating expenses, and profit margins must be considered.

Within any organization, visions may not align. This is where companies must compromise and find direction.

Establish a clear development strategy

Jamie MacDonald, a business development expert, recommends leadership take an objective look at their company’s current situation, analyzing strengths and weaknesses and financial health. Input from all facets of the business, from the budget-minded CFO to the growth-oriented CMO to the efficiency-focused COO, is necessary to ensure the needs of the organization are effectively balanced.

For instance, a business could perform SWOT analysis (strengths, weaknesses, opportunities, and threats). This can help uncover growth opportunities that would otherwise go unnoticed.

Once you locate problems to fix and potential growth areas, it’s time to identify strategic objectives. This means laying out high-level goals for all areas of business. Then, break this down into short-term plans that describe what teams need to do to achieve these goals. Next, establish ways to manage performance and adapt and improve as business development is ongoing.

Of course, this is easier said than done. As Peter Bregman, CEO of a global management consultancy, notes, there is always a tendency for leaders to think about their “own arrows — their piece of the company,” rather than the company as a whole.

Bregman says there isn’t an issue with crafting a unified strategy. What’s necessary is to remember the “big arrow” — the direction in which leadership hopes to take the company. Strategies across every department should keep the big arrow in mind. The key is consistently emphasizing this overarching strategy. This will make decisions around financial leverage, operating expenses, growth strategies, and more much easier.

Stay on top of finances

Prudent CFOs and accountants remain crucial to ensuring growth is sustainable. A staggering 82% of businesses that fail do so because of poor cash flow management, according to a US Bank study.

Clearly, any business development strategy must keep cash flow in mind.

For example, financial leverage is only a good idea if the return on investment exceeds the cost of debt, or the influx of capital leads to greater bottom line growth. If sales growth can’t rise quicker than expenses and debt, then the business will not be in position for success. Though it’s worked eventually for some companies, top-line growth at the expense of the bottom line can be dangerous. Without profitability, funding for business operations and development becomes more difficult to obtain and manage.

One way businesses can obtain help and guidance is through their investors. Business development companies like Saratoga, for instance, not only invest in developing companies, but also provide strategic advice and managerial assistance.

When considering growth strategies, businesses should think of both the top line and bottom line, and how the two should feed off one another. There is no need to highlight one above the other, as both are important to long-term success.

A company must attempt to simultaneously earn more revenue while continually optimizing business processes to lower operating costs. Set goals that detail how an increase of X percent in revenue should lead to an increase in X percent in profit. This will put the company on a path greater market share and positive cash flow. This is how businesses can set themselves up for long-term success.

Remember the direction ahead

Intelligent handling of finances, savvy business strategizing, and thorough execution of plans requires leadership maintain focus on the vision. With solid communication and transparency, conflicts between expenses, profits, investments, and debt can be solved, and the business can successfully forge ahead.

Depending on your individual personality, email is either the best invention of the digital age (thus far), or a time-wasting, soul-sucking menace, evidence of humanity’s tendency to take two steps forward and one step back.

Whatever description you may settle on, know this: email proficiency is incredibly important, especially when it comes to private equity and business development. In fact, I’d go so far as to say that email management is, next to networking and deal flow, probably the most important skill a BD professional has–at least in terms of first communication and softening up prospects.

Think of it this way: when it comes to following up with warm leads, particularly those prospects that you’ve already met in person, email is an excellent tool, allowing you to keep records of conversations, facts and other details exchanged, and even set reminders. But without the right mindset and goals, it’s impossible to master this valuable medium.

What is the point of email management?

Let’s get one thing out of the way first. Even the best email management techniques are useless if you don’t have an end in mind. Instead of picking and choosing from the thousands of email management listicles out there, try working backwards: determine your goal and then work backwards to achieve it.

To begin, your email goals are likely simple ones: boost efficiency, streamline your processes, and simply have email take up less of your life. You’ll probably want to spend less time on useless emails, to spend more time with specific leads, and spend less time sorting out your email inbox. Basically, you wish to have email work for you–and not the other way around.

Switch services if you can

Though it may be out of your control, one action that could work wonders would be to change email providers. Granted your company may already have an existing email interface (Outlook anyone?), but to be honest, not all email services were born equal. The best offer intuitive, all-encompassing interfaces that you can plug into your other apps, such as calendars, and are responsive (they can be used on smartphones and tablets in addition to computer browsers).

By far, the best email provider is Gmail. Granted, Gmail for Business (the company calls it G Suite) is no longer free; however, it is a fantastic choice. With G Suite, you can rely on all the standard features that you’ve grown accustomed to with Gmail: Calendar for keeping appointments and Drive for editing documents and spreadsheets on the cloud, to name a few. More importantly, such programs are integrated, and boast significant cross-functionality: it’s easy to set reminders and invite others to events, and to track deadlines, appointments, and important documents.

Yet G Suite isn’t the end-all of email providers. For those investors who travel frequently, especially to nations like China (where Gmail is banned) will need alternatives. As a result, Zoho is an excellent option: its broad suite of features allows users to synch emails on all devices, easy-to-use archives, templates, and integration with Zoho apps, and unlimited online storage. Still, in comparison to G Suite, Zoho is more limited: you cannot detect dates, and searching isn’t nearly as thorough as Google.

Learn to create filters and keywords

With any email provider, it’s key to set filters. This way, you not only automatically sort important documents and emails into the right folders, but you’ll also prevent overzealous spam filters from accidentally sifting out emails you actually need.

More importantly, setting up filters can prevent your inbox from being overloaded. Directing new emails to the appropriate folders (such as “New Prospects” or “Cold Leads”) allows you to avoid searching constantly for every email when you need it. After all, keep in mind that a full inbox has consequences that go far beyond frustration. One study found that email raises stress levels considerably–simply because people receive so many emails every day.

Check email periodically, and only then

Make a schedule–and stick to it. One reason for email-induced stress has to do with how we interact with email; specifically, rather than setting aside chunks of time to check email, we instead check frequently–more than is reasonable or healthy.

When it comes to this email-related multitasking, the danger isn’t just in wasting time; instead, it’s in wasting energy. Neuroscientists have found that people cannot actually multitask; instead, our brains simply switch quickly from one task to another, rapidly depleting glucose. As a result, when you compare someone who multitasks to someone who doesn’t, you’ll find that the person who focuses on a task longer will be more productive.

Towards that end, it helps to turn off notifications. In their place, set up reminders, either in the form of a timer (Pomodoro works great for this), or a more sophisticated, daily alarm that rings at various intervals (perhaps every weekday on the hour, from 9 in the morning to 5 in the evening). However you choose to do it, the goal remains the same: check your email, but only when you’re allowed to. Save your energy for everything else.

Build email catchup into your schedule

This is related to the previous point. Even paradigms of efficiency and innovation like Tony Hsieh of Zappos can fall behind on emails (and get stressed out as a result). Therefore, a helpful solution is to prioritize: set aside less urgent emails for the next day, and send the first hour or so of each day reading and answering emails remaining from yesterday.

Known as Yesterbox, this approach brings a systematic, straightforward approach–and more importantly, doesn’t demand that you do more (read and answer more emails) in less time. The trick, however, is to shuttle all emails which aren’t urgent to the next day. Moreover, when you do complete (read, reply, file, or delete) at least ten of your emails from the previous day, then (and only then) can you move onto the day’s emails. For any emails that require a lot of time to respond, you should schedule out on the calendar to do so.

In the end, none of these techniques and methods come naturally. But research shows that any behavior change, no matter how small, is very difficult. Try to pick one at a time, and stick with that. After all, you owe it to your loved ones and yourself to live a less stressed, more productive life.

Software companies have become an increasingly attractive investment choice over the last few decades. This is largely thanks to the rise of SaaS (software-as-a-service). The SaaS model has enabled promising small- to mid-market software firms to lower costs, scale more easily, and iterate quickly.

Needless to say, big bucks can be made by investing in a growing software company. Let’s take a look at the top middle market software investors today: [Read more…]