Three things I did to grow a service that didn't sell at all to 1,000 client companies

I am the president of a company called Stamen.

We were founded in 2016 and achieved a public listing in 2020. Our number of employees is approaching 200.

Our core business is an organizational development support service called TUNAG. Thankfully, it is now used by over 1,000 companies.

However, when we first started the company, it was seriously dead in the water and it was scary!!

At the time, we already had over 10 employees. Yet, our annual revenue was only about 6 million yen.

This is bad! What should I do...!! I was incredibly anxious at the time.

Sales for early-stage startups are difficult

What went wrong?

The biggest reason was, after all, that "sales are difficult." I think this is true for every company in its founding period...

No matter how excellent the service itself is, it is incredibly difficult to get new contracts when you have almost no track record of implementation.

Especially in our case, the product itself was a service that is difficult to sell from the start.

Stamen provides a SaaS that supports "organizational development." It is a service that connects the creation of a "highly motivated organization" to improvements in turnover rates and increases in sales and profits.

Of course, we are doing this because we believe it is "absolutely necessary!"

However, from the customer's perspective, it is "nice to have, but not an essential service". "Organizational development" doesn't lead to an immediate increase in sales or cost reductions.

Therefore, in the early days, we went through a period where we would try to sell and get rejected, try again and get rejected....

However, by practicing three points in our sales, the business gradually got on track.

In this note, I would like to talk about those early-stage startup sales techniques.

I hope this will be of some help to those who are thinking about starting a business or creating a business in the future!

This must be a groundbreaking service!

To begin with, the first business we started was a "fringe benefit service".

It started in the spring of 2016. My co-founder and I were talking at a cafe in Nakameguro about "what kind of business should we do?"

In the middle of the table was a single sheet of loose-leaf paper. On it were about 10 "business ideas" written in bullet points. While staring at them, the two of us talked back and forth about the growth potential of each business.

Among them, there was an idea that my co-founder brought as his "top recommendation," and that I personally felt "has the most potential to grow!"

That was the concept of "revitalizing organizations by updating the way fringe benefits work through technology".

In 2016, the fringe benefit market itself was growing significantly. However, to be honest, there were few attractive services that we, as consumers, felt were "great!" or "I want to use this!"

We had a hypothesis that there were many forms of fringe benefit services that were "not suited for the current era".

Easy for employees to use on their smartphones, high satisfaction, and something where companies can also feel the value provided—there was no such service in the world yet.

So we thought,



"If we can update the way fringe benefit services work with a modern sensibility, wouldn't it become a groundbreaking service?"
.
Thus, we decided to release a new, unprecedented fringe benefit service.

It doesn't sell at all

However!!

When we actually released it, it didn't sell at all.

We were able to get plenty of sales appointments. The feeling during conversations with customers was also good. When we explained the service, they would say, "That's great!" or "That sounds interesting!"

However, when we moved to the concrete discussion of a contract, the conversation wouldn't move forward. It didn't lead to any orders at all.

The reason was simply that "the selling price was high."

The fringe benefit service we were developing at the time was what is known as a "cafeteria plan." It is a format where employees can freely select fringe benefit menus according to their own needs.

When operating in this way, it is necessary to grant "points" or "subsidies" to employees.

In that case, "funds" are needed to cover those points and subsidies.

In addition to the platform usage fee, we had to have the customer set aside a budget for the "funds" for the fringe benefits—.

As a result, the price inevitably became high, and we couldn't get contracts easily.

It was a service we had poured our hearts into developing over half a year, so it was quite a shock...

Pivot in 3 months

With no results at all, what should we do??

After much deliberation, we decided to "pivot". It was a major decision made just three months after the release.

We had the option to stick with it, but I felt that wouldn't work out.

So, instead of fringe benefits, we decided to shift to "utilizing existing internal systems".

Many companies have "internal systems that have existed for a long time but are not being fully utilized".

For example,

・Internal awards
・"Thank you messages" to express gratitude to each other
・"Welcome lunches" to welcome new employees
・Regular 1-on-1s
・"Top messages" from management to employees

Things like these.

These often become mere formalities and are not operated well. Because of that, the organization often becomes cold...

We changed our policy to create a service that "supports the utilization of internal systems" by providing a platform.

In other words, we kept the core part of "increasing organizational engagement" as it was, but decided to change the service concept. Unlike fringe benefits, this doesn't require funds.

Since we can keep the price low, we should be able to get contracts this time!

Thinking that, we decided to make a second start.

Three points I was conscious of in sales

However—.

Even so, sales were difficult, and contracts were not easily finalized.

As I wrote at the beginning, the service of "supporting organizational development" was a business model where it was difficult to get people to spend money in the first place. It is inevitably difficult to show "quantitative value" in the short term.

Furthermore, because there were few implementation examples to begin with, it was also difficult to appeal to results with a "track record" by saying, "These kinds of effects are appearing."

From such a state, how did we manage to reach over 1,000 implementations?

Looking back now, there are about three points that I think were effective, so I would like to introduce them.

While looking back on those days, I would like to explain them below!

1. We used our own service thoroughly ourselves

In the phase with zero track record, how do you get people to believe in the value of the service?

The most important thing was "using the service thoroughly within our own company".

At the time, we made it so that almost all of our organizational operations were done using our own service. We made it a natural "infrastructure" for everyone, including engineers.

In doing so, we felt that our own organizational engagement was increasing.

In sales, we talk about examples of our own utilization. "Our organization got better when we utilized it like this!"

In a sense, our own results functioned as the "strongest implementation example".

In fact, it was precisely because we had our own tool that we were able to overcome the COVID-19 pandemic and be chosen as number one in the "Best Places to Work" ranking.

(↓ We were using it like this! Nostalgic...)

Of course, there were functions where people said, "Isn't it more convenient to use Google?" and there were times when engineers said, "I want to use other tools."

Even so, I decided, "No, even if there is some inconvenience, we will do everything on TUNAG!".

As a result, everyone came to sincerely believe in the "value" of our own service.

Can you create "empathy"?

What is the strongest weapon in sales? I believe it is "empathy."

The side proposing and the side receiving the proposal. It is important that both sides "have the same problem awareness".

Whether both sides share the same worries and are seriously trying to solve them. Whether you can share the challenge by saying, "I really understand. This is difficult, isn't it...!"

If that doesn't match, you won't gain the other party's trust.

Therefore, if we are to provide an "organizational development" service to customers, we ourselves must be seriously working on organizational development.

Worry about organizational development and go through trial and error. In the process, use our own tools to create successful experiences—.

If we don't have that kind of "real experience" ourselves, we cannot gain the customer's empathy.

(By the way, not only did we use our own tools, but from that time on, half of the agenda for management meetings was about "organization.")

This was an incredibly important point in spreading the service from a state of almost zero track record.

2. Focus sales efforts exclusively on the "management layer"

When it came to getting contracts signed, the strategy of"who to target for sales"was also extremely important.

Who would resonate most with the service concept? Who would understand its value?

Beyond the content of the sales pitch, if you don't identify that, you won't be able to close the contracts you could otherwise win.

In our case, that was"business owners."It is honestly difficult to get people at the operational level to truly understand the value of "organizational development." After all, they tend to prioritize

"whether it leads to immediate sales or cost reductions."In fact, at first, we were conducting sales meetings from the bottom up, but we were often turned down with comments like, "I understand it's necessary, but is it worth paying for?"On the other hand, many business owners understand that



"investing in organizational development is worth it."They know that increasing organizational engagement leads to profits in the long run. As leaders running a company, they have gained that practical realization.In particular, so-called "early adopter" business owners who were highly sensitive to organizational development were proactive in listening to us.Even without case studies, they resonated with the service concept and decided to sign a contract.

From this experience, I realized it was a battle of



"how to meet business owners or people close to that level."

I aggressively attended seminars and conferences where business owners gathered, and sometimes had them introduced to me through others. Sometimes I even managed to connect with them on social media like Facebook.Around this time, I did a lot of incredibly gritty work.

Achieve results and get introduced through a "chain of referrals"

As I wrote above, in the beginning, we had almost no success stories. Our operational know-how was still weak. Even so, we kept finding ways to connect with business owners and continued to make emotional sales pitches.

Then, gradually, stylish customers started appearing who would decide to sign a contract, saying, "Well, let's give it a try!"

Once that happened, we absolutely could not fail.

We couldn't betray their expectations by saying, "We didn't get any results at all."

Not only would it be unfair to the customer, but if we couldn't create a "success story" there, the service would never spread. I believed that gaining the customer's trust andwhether we could get them to introduce us to others in a "chain of referrals"would be a major key.

So we thought, "Let's commit to producing results!" but—

Organizational development takes time

The difficult part of organizational development is thatno matter how hard you try, it doesn't necessarily mean you can produce results immediately.By focusing on organizational development, "emotional moments" are created within the company, and the company atmosphere improves. Employees become happy, and eventually, results appear visibly, such as lower turnover rates and increased hiring.

This is the ideal.



However, those kinds of results don't appear immediately.
Just because you introduce a tool doesn't mean it will have an effect in one or two months. Improving an organization takes time on a "yearly basis."
When that happens, even if you get them to adopt it, there are times when

they cancel before results appear.This was a very difficult problem when we were spreading the service in the early stages.

3. We dared to make a "one-year contract" mandatory

So, what should we do to produce results?

What we thought of was to ask all customers, in principle, foran "annual contract" and "company-wide adoption."We decided to decline "monthly contracts" and "departmental adoption."

We decided to make sales pitches in a "strong style," saying, "Please definitely continue for one year."

What's good about this is thatyou can "hang in there" within that one year.Even if things don't go well at first, there are many things you can improve within a year. For example, when a feature is clearly missing, it's difficult to say, "We'll build this feature in a week."

But with a one-year contract, you can say, "We'll build the feature in half a year, so let's do this for now!" You can extend the time limit.

By enduring in that way, even if you start with the feeling that "this service might be subtle," you can recover within the year. That way, when the contract renewal date comes, they will say, "Please renew" or "Let's do our best for another year."

The temptation of "I'd do it if it were a one-off..."

However, it goes without saying that if you make both "annual contracts" and "company-wide adoption" mandatory, sales become even more difficult.

When I go to sales meetings, I am told many times,"I'd do it if it were a one-off..." or "Can't we adopt it by department?"Every time, my heart wavers.

After all, our annual sales at the time were only

6 million yen.Yet, we had over 10 employees.Reports would come up from the field saying, "This customer says they'll do it if it's for one month!" But then I would say,

"No, we only accept annual contracts."and turn them away... This was incredibly painful.Because I know the sales members in the field are struggling to somehow "produce results," the feeling of wanting to accept it also emerges.

However, even if adoption is decided, it's meaningless if we can't produce "results." I firmly suppressed the urge to shift to "monthly contracts" or "departmental adoption."

On the other hand, if there are no immediate sales, the company will collapse.



Sales are difficult, but still, somehow sell and generate revenue.In a desperate situation, somehow balance these. It was a painful time, but I had no choice but to stick it out.

Adoption by a leading company in the industry is decided

As I did this kind of sales work steadily, contracts gradually increased, and success stories emerged. We began to gain trust from customers.

A major turning point wasthat our service began to spread among the "food service industry."Contracts with top-brand companies like WIRED CAFE (Cafe Company Inc.), DEAN & DELUCA (Welcome Co., Ltd.), and T.Y. Harbor (Tysons & Company) began to be decided one after another.

This was also because the method of

"making sales pitches directly to the management layer"hit the mark. The presidents of each company resonated with the concept of our service.This became a major success story.

And because there are strong connections between business owners in the restaurant industry, the service spread throughout the industry by "word of mouth."



"Let's produce success stories and spread them in a chain of referrals."The strategy of doing this was exactly what paid off.Also, while supporting the organizational development of top companies in the industry, it became an opportunity for us to learn

"what is a good organization?"This experience also led to the evolution of the service itself.In a way, our service grew as we were raised by our customers.

Can you turn "individual success" into "team success"?

In this way, our customers increased steadily, and Stamen achieved an IPO in 2020.The number of client companiesgrew to over 1,000. Now, annual sales of 5 billion yen are within reach. We are truly grateful.

We are providing value mainly to customers in industries such as food service, logistics, and retail, specificallynon-desk workers.

Thinking back to the time when we were hopeless with '6 million yen in annual sales,' I think it's amazing we made it this far.

Looking back, I think what was important wasnot letting small successes end as 'points,' but expanding them into 'planes'.

In the early phase, we moved recklessly and somehow managed to get large companies to sign contracts.

However, it is meaningless if the success there ends as a 'point.' It just becomes mere luck.

What is important is how it connects to the 'big success' that follows.

That is why what we were thorough about waswhen someone achieved results, sharing that knowledge with everyone in the company. The next person would copy it and achieve results again.

Not only was know-how accumulated within the company, but'If he could do it, I can do it too!'we kept raising the team's standards. This was huge.

If we were amazing executives from McKinsey or BCG, we might have been able to fight in a smart way, like 'drawing up a strategy and executing it as planned.'

But that's not us. It was a complete team battle.

We moved recklessly, somehow grabbed small opportunities, and gradually made them bigger.Being able to turn 'individual success experiences' into 'team success experiences'is what I believe ultimately led to the expansion of the service.

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