As a startup founder, it’s crucial to keep the business customer-centric through all phases of growth and funding. Howard Lerman knows this well, as a three-time founder of startups that include Yext, a Unicorn that went public and kept growing. Tune in to the entire episode to discover what happened after Google declared, “We want to purchase your business.”
Lerman founded Yext in 2006 as a lead-generation platform, designed to help businesses understand what people were saying about them. The idea was that business intelligence would help companies make more customer-centric business decisions. Today, Yext serves companies like Lego, Samsung, and Subway, and Lerman is the CEO of Roam, a new venture launched in 2022.
He stopped by the Sit Down Startup podcast to share wisdom on his journey from bootstrapping founder to CEO of a public company. These are just a few of his top tips:
- Strong dialogue with customers is just the foundation—effective leaders turn customers’ problems into solutions and better products.
“Customers are very good at telling you their problems. They’re not as good at telling you the solution, because they don’t have the context of your product. And only you as the founder or visionary can string it all together and figure out how to solve their problem in a way that’s consistent with the way you want to set up your company.”
- Use customer relationships to expand your customer base.
“You’ve got to figure out ways to grow without doing expensive paid advertising,” Lerman advises. “You need to make sure that your existing customers are driving your existing referrals.”
- Reconsider your pricing packages.
When there is less venture capital to go around, budgets are tighter all around, and every tool, vendor, and solution is being put under the microscope, Lerman suggests competitive pricing to remain attractive for CFOs looking for cost savings.
- Lean on software to automate and support your processes—but don’t think of it as a magic wand.
Software solutions, for everything from CX to HR, to IT, can be a big help for companies just getting off the ground. Software can help resource-strapped teams manage customer support, automatically route customers to the right department, serve up answers from a help center, and more. But targeted face-to-face time can be more powerful in building foundational connections. Choose your moments and meet your customers where they want to meet you.
Above all, don’t look to growth as your only measure of success. Over-indexing on it can land founders in tough situations—where the dollar signs take focus off customers and their problems, and growth hacks overtake the business strategy. Lerman’s guidance: concentrate on building something first; understand and prioritize customer needs; strive for connections beyond just technology; and balance growth expectations with reality—which are all hallmarks of successful B2B SaaS companies.