Newsgator – going about enterprise sales the right way

I was catching up on my feed reader this morning and noticed my friend Jeff Nolan’s post (also see Brad Feld) on Newsgator and FeedDemon RSS clients now being free.  I know that Jeff joined Newsgator  because of his belief in the enterprise, and I applaud the company’s new strategy.  As I have written before, enterprise sales is incredibly hard.  If I were going to do anything on the enterprise side, I would look at how to make my sales as frictionless as possible.  Leverage SAAS and downloads and reduce the barriers to usage.  What you have in a free Newsgator and FeedDemon RSS client is the opportunity for the pull-push method of enterprise selling vs. the push-pull method.  Rather than only rely on expensive enterprise sales guys trying to push products into corporations, Newsgator, as Jeff says in his blog post, has the opportunity to expand its client base from 1mm users to 10mm users and have them potentially pull Newsgator into new enterprise sales opportunities.  This is certainly a new way of thinking and considering that the company has an excellent client, this should be a winning strategy.  From Jeff’s post:

So if we are generating zero dollars of revenue from the client applications that we used to sell, well what is our business? Today we generate the bulk of our revenue from enterprise software, which is predominately server products but also includes these client applications (we call them “endpoints”). The fact remains that we actually generate a significant number of enterprise leads from people who are using our client apps and then realize they would benefit from enterprise management products. By that logic, more client applications in use is more enterprise goodness for us.

Published by Ed Sim

founder boldstart ventures, over 20 years experience seeding and leading first rounds in enterprise startups, @boldstartvc, googlization of IT, SaaS 3.0, security, smart data; cherish family time + enjoy lacrosse + hockey

2 comments on “Newsgator – going about enterprise sales the right way”

  1. Thanks Ed,
    Happy New Year to you and the family.

    We had a really good day yesterday, a reflection not only of the enthusiasm for making stuff free but also of the brand equity the company has in the market.

    We’ll still build out our sales teams but it’s my hope that with this move their job gets a lot easier. We’re seeing the market firm up in terms of demand, the number of competitors we have, and the capabilities of the products, so I really believe that we have about as good alignment of the planets as we’ll get and it’s time to strike.

    But this move is also about expanding our product capabilities through community filtering and discovery capabilities. We generate a lot of behavior data that translates into “attention markers”. If we can successfully take that attention data apply it to search and filtering, well we’ll end up with a network effect in our products that is very powerful, akin to how search engines use clicks in search results to improve the quality of future search results.

  2. thanks for explaining further. Network effects will be potentially huge and add more value to your enterprise efforts and the FREE will certainly grease the skids for your direct sales guys. Having to not ONLY rely on sales guys to get the word out is a great thing

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