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One of the Biggest Mistakes Enterprise Startups Make

The era of VCs investing in successful consumer Internet startups such as eBay led to a belief system that seemed to permeate many enterprise software startups that hiring sales or implementation people was a bad thing.

The line of reasoning goes, “Services businesses are not scalable and the market won’t reward this revenue so make sure that third-parties do your implementation or clients do it themselves. We only want software revenue.”

This is a huge mistake. If you’re an early-stage enterprise startup services revenue is exactly what you need.

1. Successful Implementations
2. System Integrations
3. Channel Partners Not Yet Formed
4. Your Best Eyes & Ears
5. It’s Profitable Revenue Covering Your Fixed Costs

Professional services = profitable revenue streams that fuel your business continuity.

The key is to not become overly reliant on professional services. There are some clear do’s and don’t for how to layer in professional services into a software business.

 

Read Mark Suster’s full article here.

Mark Suster is a 2x entrepreneur turned VC. He joined Upfront Ventures in 2007 as a General Partner after selling his company to Salesforce.com.

Follow @msuster

 

 

 

 

About the Author

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Mark Suster

Mark Suster is a 2x entrepreneur turned VC. He joined Upfront Ventures in 2007 as a General Partner after selling his company to Salesforce.com. Follow @msuster

http://twitter.com/msuster