Interview: Desperation Never Sells But Relationships Do with Lloyd Armbrust
Lloyd Armbrust is the founder of OwnLocal a venture capital backed technology company that powers over 100 publications and reaches over 1 million visitors a month. Starting out he not only was able to convince newspaper companies to pay for his company’s service, but they also helped fund him to build his company. Today he shares how he networks and builds relationships.
Your company OwnLocal started out as an app to put print ads online. Starting out you’ve said that you needed to get more newspapers on board so you could make enough money for you and your cofounder to quit your day jobs. How did you convince newspapers to use a product that was new and relatively untested and convince them to pay you for it?
I actually convinced them to first pay for the development of the product, and then later to prepay a year in advance so that we could use the money to grow faster.
Sales comes down to two things: relationships, and the ask. If you want to sell something, especially in the Enterprise, you need to have solid relationships, and you can’t be afraid to ask for money—most people actually have the hardest time with the ask.
For me, I had worked in the newspaper industry for some 8 years so I had plenty of solid relationships. If you’ve made a lot of money for someone in the past, they’re a good person to goto for help in the future.
When you applied to Y-Combinator, the popular tech startup incubator, you got feedback on your application by approaching strangers in Starbucks and seeing if they understood your business? How did that actual conversation start and go?
Again, this comes back to the ask: the hardest part is approaching someone and asking if they’ll help. Once they believe that you’re trustworthy (and not trying to sell them something) the information flows. Plus, they’re an easy mark… “Do you want coffee?”… “Yeah, I’m standing in line to buy coffee, so obviously I want some.”
Admittedly, a few folks declined even the free coffee, but everything goes back to that trust (relationship) and ask.
How do you use networking to grow your business today? Does attending trade shows and conventions help? Do you cold email potential customers?
In my experience, cold emails do not work in the Enterprise. We foster relationships in a number of ways: industry conferences, speaking engagements, twitter, LinkedIn, corporate sponsorships and blog posts. Of everything we’ve tried, working to become an industry thought leader has had the most success. I say “working to” because we’re no where there yet… but our effort builds those relationships so that the ask becomes easier.
Let’s say you are at a conference or networking event. From your experience what does someone have to do to leave a good impression on you?
It’s hard to say. I appreciate anyone who is a hard worker—so while a “sales” person is annoying at first, if they keep trying, that’s impressive. But at the same time, I also respect people who don’t have to hustle.
When I go to a conference, I’m not necessarily working to get business. I’d rather have a conversation about changing the newspaper industry over a single-malt Scotch than try to hustle my company at a convention booth.
Sometimes I’ve talked with an industry executive for a few hours over drinks and dinner, and as I’m picking up the check they asked, “Wait, what is it your company does?” For me, this is not a conscious effort, but I think it demonstrates two things: one, that I care more about our industry and our relationship than I do selling to them; and two, that I don’t really need them as a customer (because we have thousands of customers).
Desperation never sells anything. But relationships do.
What do they have to do to leave a bad impression?
I can’t stand it when people try to sell me something when they don’t understand if I need it. I get it, you have the very-best crowd-sourced cloud-based social-local and GPS enabled dog-watching service. If I don’t have a dog, I don’t care.