20 things a CEO learned about starting a business

In the face of an ever-changing market, founders should maintain an open mind, proactively collect information, promote awareness upgrades, and respond to unknown changes. This article summarizes 20 insights from a CEO on entrepreneurship, which I hope will be helpful to you.

It is difficult to always have leading cognition. The only thing we can do is to keep an open mind and actively acquire new information to continuously promote cognitive upgrades.

Three years ago, Sensors Data’s WeChat public account published an article titled “Sang Wenfeng: Five Years of Entrepreneurship”, which conveyed the founder and CEO Sang Wenfeng’s views on entrepreneurship and gained a lot of attention and recognition from fans. On the occasion of the eighth anniversary of Sensors Data, the editor will share with you Sang Wenfeng’s latest cognition and thinking over the past three years. Welcome to exchange ideas.

1. The underlying logic of entrepreneurship comes from "cognitive upgrade"

Business opportunities are contained in the knowledge that is not common sense. Correct knowledge is the driving force for future development. Correct knowledge generates motivation, while incorrect knowledge generates resistance. It is difficult for us to ensure that our knowledge is always leading. The only thing we can do is to keep an open mind and actively acquire new information, so as to continuously promote cognitive upgrades.

Organizations also have cognition, but the cognition of an organization is often not equal to the cognition of the founder. The best way is to drive the improvement of the cognition of the entire organization and let advanced cognition stand out.

2. The three-stage rocket for sustainable growth of To B enterprise performance: marketing, sales and customer service

Marketing, that is, reaching users, mainly includes channel tracking, attracting customers from the official website, and evaluating leads. Sales, that is, promoting conversions. When the market lets users know about the product, they need to be converted through sales. Customer service, that is, improving corporate satisfaction and renewal rates. The key factor for the success of the subscription model is customer satisfaction. The three are closely linked and none of them can be missing.

3. The market is objective and has its own rhythm

If the market is not growing rapidly, we will do in-depth cultivation. Enterprises need to judge the current market situation based on the combination of demand pain points, customer groups, commercialization, and competitive situation, and adjust a certain dimension to maintain survival. However, the model is not fixed. Don't go into a dead end all of a sudden. Find ways to make dynamic adjustments, which will make the entire business bigger and bigger.

4. Respect the market and upgrade the strategy under MRP thinking

Some outstanding entrepreneurs first look at the market to determine whether it is big enough. After all, only a trillion-dollar market has the opportunity to build a hundred-billion-dollar company. At the same time, they look at the key pain points of the industry.

If the conclusion is: the market is large enough and can solve the pain points of the industry, then they will start to work - they have people, money, and resources, so they don't have to worry about not being able to create products. I abstract this model as the MRP model, that is, from Market to Requirement to Product. Respect the market and let market research come first.

5. Are you selling baby bottles or baby nannies?

We need to make the value point clear and tell everyone whether you are selling a baby bottle or a baby sitter. Each target customer group must be differentiated. The clearer it is, the easier it is to provide targeted value. Each value proposition must have granularity. The reason why we use the word "value proposition" instead of "value" is that we want to make it clearer.

6. Let ordinary sales also sell products

Just because a To B product can be sold doesn’t mean it can be sold on a large scale.

On the one hand, it is necessary to build a sales team. Without a sales team, the company's combat effectiveness will be limited.

On the other hand, clear and precise target customers, coupled with highly competitive products, enable us to provide maximum support for signing orders without considering the sales capabilities of the sales themselves.

7. Don’t pursue “out-of-the-box use”

We also hope that Sensors products can be used out of the box like To C products, but To B products are constantly iterating during the delivery process with customers. What we want to do is a "SLR camera". If we follow the fool-like logic, many powerful functions will not be realized. So how can we lower the threshold for using the product? In addition to powerful product functions, we need perfect services to achieve this.

8. To B products are like Lego

When users buy Lego, they are not just buying individual bricks, but the complete kit and, more importantly, the kit instructions. Without the instructions, few people can put together a decent shape.

The same is true for B2B companies. In addition to providing products, they also need to provide product manuals, application methodology, product usage procedures, etc. The customer successfully plays the role of the producer of Lego manuals, leading some users who do not understand the product well to complete the first Lego assembly process.

9. Services that cannot be eliminated

At the beginning of my business, I always wanted to get rid of the service. But in order to truly deliver value, we must provide services based on industry characteristics and actual customer needs. Especially as product functions and customer structures develop in a diversified and complex direction, a strong service team is needed to support the delivery.

So far, 40% of Sensors employees provide service support. Since service cannot be "done away", we can continuously optimize the service system through a series of actions to ensure organizational efficiency.

10. SDAF Data Closed-Loop Methodology

The business operations of an enterprise are all carried out around SDAF: Sense, Decision, Action, and Feedback.

At the same time, our service system has been further upgraded to the form of "consulting services + productized data closed loop + standard services" and "consulting services + industry solutions + project management services".

11. Analysis + Marketing, Solve Customers’ Private Domain Marketing Problems

The marketing field includes two categories: public domain marketing and private domain marketing. The core of public domain marketing is traffic. Sensors itself does not own "traffic", so we can only serve customers as a "supporting role"; private domain traffic is equivalent to a company's own "field", and Sensors has great potential in terms of how to "cultivate" and "plant" it.

To put it more vividly, it can be said that Sensors only "drinks soup" in the public domain traffic pool, helping customers with advertising monitoring, advertising optimization and analysis, etc.; in the private domain traffic pool, it helps customers "cultivate the land" based on the existing traffic. What Sensors clearly wants to do is data analysis + marketing.

12. Reverse drive

In the past, most companies were stuck at the stage of "using demand to drive product development". Under this year's situation, there has been a trend of "using solutions to drive product development".

For enterprises, they can no longer stay at a single function point, but should take the final solution as the value to be delivered to customers, and drive product development from this perspective. That is, define the value of delivery and implementation at the beginning, and then carry out product development. This is a kind of reverse drive or a kind of value retrospection.

13. Only the first place is a "friend of time"

As time goes by, the market's high-quality resources (money, resources, talent, etc.) will gradually gather towards the first place, and the strong will become stronger and the weak will become weaker. Therefore, we insist on doing things to the extreme. If we can't get 90 points in a field, we will further subdivide the field and do the best in the subdivided field.

14. An enterprise is a commercial organization

For Sensors, there are two big accounts to be calculated: one is the gross profit margin when providing services, and the other is the ROI of R&D investment. For project delivery, it is not only about the contract amount, but also about confirming revenue, collecting payments, and maintaining a healthy cash flow.

15. True Business Closed Loop

I used to think that making a product and selling it was a closed business loop, but now I realize that making a product, selling it, and making money is a closed business loop.

From this perspective, making money is an issue that must be considered. Only when we have a clear account can we better and continuously bring value to customers. At the same time, making money by calculating accounts also brings about conflicts in corporate values. From providing services unconditionally to starting to calculate accounts to make money, we also have questions internally - is it good or bad for Sensors to become a more commercial company? I think this is precisely a return to the essence of business.

16. Culture and business need to be closely linked

Culture is influenced by the founding team in the early stage and by the business in the later stage. Culture and business are strongly related. It is false and wrong to talk about culture in vain. From Sensors' own perspective, from data analysis to marketing technology, from serving Internet companies to serving medium and large enterprises, the company culture is destined to continue to evolve to better fit the business.

17. Use advanced cognition to unify thoughts and use scientific methods to improve efficiency

Sensors is a company that organically combines organizational construction with scientific methods. Efficiency is the culture that Sensors most respects. Just as Apple praises innovators and Nike praises top athletes, we praise those people and organizations that use scientific methods to improve efficiency.

18. Every student who joins Sensors must have an open mind

We have also introduced a large number of excellent talents from SAP and Adobe China, which have brought new strength to our understanding of the marketing cloud market and the development of the industry. Therefore, we must unify our thinking. No matter which company they come from, they must change to the core of Sensors when they come to Sensors - the pursuit of excellence at the bottom of Sensors, the use of scientific methods to improve efficiency, and the value brought to customers must be installed in their heads. In other words, we hope that every student who joins Sensors will have an open mind and dare to transform their own "operating system".

19. Co-creation is collective learning for the future

The requirements for co-creation mainly include:

First, the level requirement is high. Co-creation is not suitable for everyone and requires participants to have a high level of cognition.

Second, you need to use your brain. Co-creation requires each participant to not only listen and receive information, but also to "transmit information back" and give feedback.

Third, facing the problem of future uncertainty. From our own perspective, the reason why marketing cloud is difficult is precisely because it is semi-open and semi-deterministic, which requires team members and customers to work together to achieve breakthroughs.

20. Starting a business is like driving a ship. The only thing we can do is to steer the ship well.

When I first started my business, I felt that it was like a 100-meter sprint, thinking every day about how to get to the finish line as quickly as possible. Later, I found that starting a business is more like a marathon, which requires constant persistence.

After a while, I felt that starting a business was more like a marathon after 30 kilometers. You wanted to "die" every step you took forward, especially when you stopped and restarted, it would be very painful.

At the beginning of 2020, I found that starting a business is more like playing mahjong. It is hard to tell whether you win or lose unless you leave the table. For many companies, they may be successful at a certain stage, but it is hard to say whether they will have good development in the end.

By 2022, due to major changes in the economy and capital markets, I realized the objectivity of the market. I found that starting a business is more like driving a ship. The rough waves under the ship cannot be controlled. The only thing you can do is to steer the ship well.