Case Study – Market Penetration Results Lead to Attractive Exit

AI Language Processing Innovator Giant Otter LLC based in Cambridge MA calls on Barnett Strategies to turn ground SaaS chatbot code into customer cash

With an innovative, AI-powered chatbot platform, Giant Otter offered an example of revolutionary technology. But while their product may have broken ground, breaking through and into the market was another issue.

Two years ago, Giant Otter reached out to Barnett Strategies and its founder and principal, Chris Barnett, thanks to a recommendation from longtime Giant Otter advisor, Vlingo co-founder John Nguyen (Chris led Vlingo’s sales and marketing team).

“Most specialized sales and marketing folks can’t deal with the ambiguity of the product/market-fit stage,” says Giant Otter co-founder and business development head, Dan Tomaschko. “John knew that Chris had the right experience, and would tailor his approach and advice to the stage of our company.”

Digging in to the Challenge

After the connection was made, Chris saw Giant Otter’s potential alongside its challenges.

“Giant Otter had a strong technology baseline, thanks to [co-founder and CEO Jeff Orkin’s] research at the Massachusetts Institute of Technology and several years of commercial development,” says Chris. “But they had no commercial deals yet and prospect engagement was based only on their networks and inbound inquiries.”

A look at Giant Otter’s web analytics shined a light on some basic issues. “Chris showed us how far behind we were in generating interest in our product, just based on website traffic,” Dan says. “Those metrics were eye-opening.”

“The chatbot space was — and is — extremely noisy and overcrowded,” says Chris. “Many competitors had similar claims and language, with a lot of vaporware and overstated promises confusing customers.”

So Much Noise…

To break through the noise, Giant Otter would need to articulate clear and compelling features and benefits. With Barnett Strategies’ guidance, Giant Otter had a story to share about a product that wasn’t just viable but vital.

“Chris and his team helped us get into the heads of busy, over-pitched buyers,” says Dan. “We stepped up our aggressiveness and our helpfulness several notches to stay on buyers’ radars.”

Key to Barnett Strategies’ efforts was increasing awareness and interest in the right places. “We identified the highest priority target markets from among a very large potential set of market sectors,” Chris says. “Then we worked to understand the high-value entry points: Marketing? Customer care? IT? Executives? Innovation departments?”

Once the right people received a recalibrated message, results came quickly. “In 2018 we generated a third of our new clients from the lead-gen program they helped us to stand up in Q2 of that year,” says Dan. “Chris and his team then helped us to negotiate our top three biggest deals.”

Chris remembers one important milestone: “When Jeff and Dan were double booked with pitches to high-value customers from top name brands, we knew the strategy and execution were working.”

The Results are In

An active funding round followed, culminating in the introduction of an optimal business partner for Giant Otter: conversational marketing platform Drift.

“A potential investor introduced us to Drift CTO Elias Torres,” says Dan. “We quickly realized that there was a strong fit between our products, our vision for the future, and our common ambitions. We realized we could go further together, so we turned down investors interested in the round and joined Drift instead.”

Paving the way to Giant Otter’s successful exit were the efforts of the Barnett Strategies team. “Chris helped us with all of our go-to-market efforts,” Dan recalls. “From positioning and articulating a value proposition, to targeting prospects for outreach, to generating leads via outreach and content marketing, to tracking prospects and nudging them down the funnel, to closing and documenting the exit.”

Now that Giant Otter is part of a large company with an in-house marketing and sales team, its working relationship with Barnett Strategies has wrapped up. “But on a personal level,” says Chris, “we’ve kept in touch and continued to collaborate — Dan made an intro to Spansive, which has become a major Barnett Strategies client.”

“We are happy boosters for Barnett Strategies,” says Dan.

Seeing Results: The Barnett Growth Quadrants

Technology and software-as-a-service (SaaS) companies often come to us when they haven’t fully realized growth on their own. We survey the situation with a model that lays out their marketing spend versus the size of revenue results they’ve seen. We call this matrixed approach the Barnett Growth Quadrants:

Big budget, big results: Pay (Big) To WinWhat it visualizes is four types of management teams — a couple to aspire to, and two to avoid.

Imagine you’re the CEO of Apple. AT&T. Nike. You blanket the globe with your unmistakable brand and omnipresent message, thanks to a marketing division bursting with talent and a budget that bulges with zeros (the five largest marketing spends totaled over $46 billion in 2017, per Ad Age). This is the goal, but let’s not dwell on it. Pin a picture of Phil Knight to your vision board and keep reading.

Big budget, low results: Expensive Failure

Another scenario: You throw money at your problem, which only compounds (as does the venture debt interest). Channels are sucking cash but not spitting out results, spreading efforts and patience thin. Your ego, fear, or false hopes squelch a smarter, sounder approach.

It’s a nightmare that’s too real — see Beyond the Rack and Chef’d for examples of multi-million dollar mistakes. But even start-ups with a total capital of $1 million can run into $30,000-a-month PR retainers, sales staff on payroll with no product, and misguided marketing purchases (maybe scale back that lavish trade show booth).

Small budget, small results: Thrifty Failure

Most start-ups start small, but staying that way indicates a lack of strategy. Maybe your entire digital department a nephew with Squarespace skills. Or you rely on gig-economy tactics for your public relations or sales staff. Perhaps the lists you buy get you sucked into spam filters 90% of the time. It’s all technically something — but it’s not savvy.

Perhaps you managed to taste success through these efforts, but don’t have the acumen or hours in the day to go further. Your good ideas need amplification. Your positioning needs to adjust (or exist). There’s only one place to go: our final quadrant.

Small budget, big results: The Best of Both

Welcome to the sweet spot — a place not many start-ups occupy. Here, your goals clarify and your budget clicks. You get the results you want with a burn rate that works for you. You spend time crossing off your success checklist, not revising it.

We love guiding entrepreneurs and venture capital investors into this optimized quadrant. Here, we make a difference for prudent yet hungry companies who can’t afford to go into debt or stay small. If that sounds like you, and you’re ready, let’s talk. » chris@barnettstrategies.com

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