Thinking Outside the Box: Aaron Levie’s 4 Keys to Dominating Enterprise Software
Whether you’re the founder of a software startup trying to compete against big competitors or a serial entrepreneur looking for the next great enterprise opportunity, Aaron Levie, the co-founder and CEO of Box, has some advice for you: Avoid doing the obvious.
“Take the stodgiest, oldest, slowest moving industry you can find. And build amazing software for it.” — Levie, in a recent tweet
In 2005, Aaron Levie co-founded Box as an innovative solution to the staid hardware-based file storage and sharing market. Since then, Levie and his team have built the company into one of the most innovative and highly touted enterprise software platforms in the world. According to Inc.com, Box’s customers include 97 percent of the Fortune 500, and the business is now being valued at $1.2 billion. Not bad for a startup that was created in a University of Southern California dorm room.
So, what’s made Box so successful at the enterprise level, and how has Levie made something as mundane as file sharing and content management into something that’s sexy?
Here are four tips from Levie on how to position your software startup to take the enterprise world by storm.
4 Lessons in Enterprise Software Growth Strategy You Can Learn from Box
1) Make User Experience Your Competitive Advantage
For years, very few enterprise software vendors paid much attention to user experience. It simply wasn’t a top priority. When Levie and his Box team set their sights on the enterprise market, they did the opposite.
As Eric Markowitz points out in this Inc.com post from last year, Levie predicted in 2010 that the most successful enterprise platforms of the future would be driven by mobility, design, simplicity, and usability. So, that’s precisely the direction Box took.
“We truly believe that sharing should be simple, and we’re constantly listening to feedback from our users on ways to make Box even easier to use,” writes Box Director of Product Management Brandon Savage in a post on the company’s blog. “We see simplicity as a pretty powerful edge over traditional enterprise software solutions, which are typically feature-bloated and require heavy IT intervention and maintenance.”
2) Adopt a Trojan Horse Strategy
Another major issue with enterprise software in the mid-to-late 2000s was that enterprise software buyers were rarely the end users of the actual product. In fact, they often operated in a very different corporate silo.
Box’s strategy for addressing that hurdle was simple: Avoid the traditional route altogether by building adoption and loyalty with users first. Those users could then drive adoption upward, instead of the company having to wait for it to trickle down to the buyer.
“[Box] represents a powerful lesson to entrepreneurs entering the enterprise software business: Build something employees aren’t told to use but something they want to use,” Markowitz writes in Inc.com’s post that named Levie the magazine’s Entrepreneur of the Year. “Levie didn’t start off by selling to IT department buyers; he started off by creating a great, free product that would attract early adopters. Once these employees got hooked, they wanted more, and IT buyers were forced to purchase.”
3) Take Responsibility for Customer Success and Support
One significant challenge facing startup and expansion-stage companies entering the enterprise market is that the enterprise model traditionally requires large amounts of professional services and support, and those activities tend to absorb significant man power and capital.
Box, however, has attempted to dodge that obstacle by building a product so simple and easy to use that it simplifies (or ideally removes the need for) costly implementation and support processes. As a result, Box’s enterprise customers were able to get up-and-running quicker, and customer satisfaction was much higher.
“The enterprise software industry has become too wedded to a model where the success of the vendor is disconnected from customer success,” Levie told TechCrunch in 2011. “Traditionally, as soon as an enterprise software sale is made, it becomes the buyer’s responsibility to support the purchase — often requiring the manpower of a 6 and 7-figure consulting engagement.
— Aaron Levie, Founder and CEO of Box, in a guest post for TechCrunch
4) Target Unease and Deliver a Compelling Solution
Of course, the enterprise software market is much different than the one Zappos targets. But Levie says the approach to identifying customer pain points and becoming the solution for those issues should be no different.
In Box’s case, one primary many enterprise customers were concerned with was the security capabilities of cloud-based storage services. Levie and his team addressed that by building security directly into the company’s value proposition.
“The idea is, ‘How do we make Box become the enabler for them to be able to move to the cloud — the solution for their security in the cloud,’” Levie explained to Marktowitz in this post for Inc.com. “So not that it’s a check box that allows them to adopt Box; it’s actually the reason they put documents in the cloud.”
What are some of the other challenges your company has faced selling to the enterprise vs. consumer market? Let us know in the comments below.
Image by Theophilos Papadopoulos
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