Bastian Nominacher – Co-Founder & Co-CEO, Celonis
Celonis was founded in 2011 by Bastian Nominacher, Alexander Rinke and Martin Klenk. Its process mining software helps companies unlock the capacity to maximize business performance. Headquartered in New York and Munich - and with 15 offices worldwide - Celonis currently has more than 1000 employees and more than $100 million in revenue. To date, Celonis has raised $370 million and is valued in excess of $2.5 billion.
On the importance of sales for founders:
Sales is such an essential area of your business. You can’t just hand it off to someone else. As a founder, you have to go through the process yourself to understand it. In the beginning, sales is a very entrepreneurial activity. How do you find someone with a need? How do you get their contacts? Only later does the process becomes more standardized. Now at Celonis, we have hundreds of people dedicated to our go-to-market activities.
A founder can sell on an entirely different level to a sales representative, who can only change the product or change the pricing. A founder can change the rules if that helps close the deal.
On learning how to sell:
In Germany, sales is often considered as a mythical thing. But founders, especially engineers, need to understand that selling is a serious profession that must be approached just as systematically as any other area of your business.
If you are looking to understand how to sell, my advice is to shadow someone who is selling professionally. Visit a call center and listen to the conversations the sales representatives have. Accompany a field sales rep for a week and see how they prepare and conduct their meetings.
On the sales process / getting to decision-makers:
One crucial step is to understand your customers’ decision-making structures. How do you get to the decision-makers? It took us a while to determine that the procurement manager does not make the actual purchasing decision but merely decides on terms and conditions.
You need to get to the decision-makers. But how do you get their attention when you are just starting? We soon learned that assistants would throw away letters before they even reached the decision-maker. So, what did we do to get past them? We hand-labeled envelopes. No assistants throws out something fhand-labeled -- it’s probably from the manager’s grandma! Of course, that was time-intensive, but it got us a 50x higher open rate.
On the sales process / learning and scaling:
Of course, the process changes. In the beginning, it was trial and error for us, and not at all standardized. But as soon as we could, we analyzed what worked and what didn’t.
We found that we could talk the prospective customer’s ears off about the advantages of our product, but what excited them was a live demo. As soon as we showed what our software could do, we got them hooked.
After two or three years, we realized that customers always asked the same questions. We used these insights to create a sales package that answered all those frequently asked questions. That kind of standardization was necessary to scale the business.
Startups often make the mistake of targeting customers based on the wrong criteria. It is important to focus on the segments where you see the biggest scope and opportunity to scale – at least to start with. Do not make the mistake and try to boil the ocean.
In my opinion, there is no general rule for how big deals should be at a specific stage – it entirely depends on the business model. But founders need to consider that the sales cycle is different for different-sized customers: the process takes longer for a €1 million deal than for a €50,000 deal. Some startups make the mistake of focusing on smaller companies, as they find it easier to get appointments. That might be the case but still doesn’t help to close deals if your product is, for example, too highly-priced for the target audience.
On lessons learned:
A significant milestone in our first years was to win strong partners like the Big4 firms as KPMG or Deloitte or software vendors like SAP as partner. It helped provide the necessary credibility to get a foot into the door of potential customers. Today, our brand is well-known in the market. That makes it so much easier.