YC Startup School’s Delhi founders who work for SMBs met online to share the problems they were working on and what they learnt while building for SMBs. For the first meetup, we had mouve.app, restat.co, designforpeople.in, and Uplift Inc.

As we discussed how we discovered the problem we are solving, mistakes we have made, our markets and customers, we had some interesting lessons for each other. Here are 6 lessons for startups working for SMBs:

#1 Blue Ocean vs Red Ocean strategy

We revisited the famous blue ocean vs red ocean strategy. As many people are building software solutions for SMBs knowing whether your market is a blue ocean (aka a new market) or a red ocean (i.e. already filled with big players aka sharks) is important. Here’s a quick summary for you:

For example, accounting and sales software like ERPs and CRMs have been around for a while, red ocean, and you might encounter sharks. To win the “red ocean” market, you need to create the value-cost trade off very apparent for businesses. Also, know that you are agile, and quick, and can create market-winning product differentiation by addressing user needs that the sharks are not fulfilling. Looking at a “blue ocean” example, automatic content generation like short videos, photographs, for e-commerce sites can be a good market to tap, and good user-friendly tools can capture this upcoming demand.

#2 Mitigating the “Lala” mindset

It’s not a lesser known fact that selling to small businesses in India is difficult, and not a lot of companies have been able to successfully generate revenue from the market. We discussed strategies to win typical Indian businessman (aka Lalas), here are a few:

Direct benefits over vision: quote case studies that have led to actual business benefits such as increase in sales, or reduction in cost, etc. It can help in winning new users, if not customers.Build trust with the user by ensuring that your software does the job well. For example, if you do data analytics on business data, customer balances not matching with their accounting software is a big no-no!First value, then revenue: if you can’t demonstrate value for their businesses, these small businessman won’t be comfortable spending a penny, but if you do, you can win these customers for a long term.

#3 Gamify the incentive?

We discussed how engagement is important for the user segment and a good way of doing that would be to gamify for users. Gamification will help get appreciation for their job, and users are likely to feel comfortable learning a new piece of technology and be invested.

For example, let’s say, if the business owner sets a daily target for the sales team, and if the sales team reaches that target, they probably get a badge for their work. If a sales person is very consistent across time, they get a “Sales person of the month” batch. This can not only push the application usage, but also improve employer-employee connections.

#4 UI vs UX — what matters?

As we were reviewing some of the software, we discussed how Tally has been a market leader for years, and we concluded the reason was that while Tally doesn’t have the new age UI, however, the UX works really well for an accountant — the prime user for the software. Tally saves him/her a lot more time compared to any new alternatives. Tally proves that the experience of the user matters more in the sector compared to the UI.

#5 Play Store for distribution!

One of the participants shared how they were able to create a quick prototype and earned over 200k users through organic user growth in Play Store only. Since marketing channels like Facebook, Twitter, Google, etc. might not work well for SMB users, putting out your app on Play Store can work as a good medium for distribution.

Though a word of caution: get your focus right before publishing on Play Store and ensure that you are confident about the direction of the application, because once you have enough users, you can’t change course so easily, and will have to serve current customer base — it’s a double-edged sword.

#6 Engaging customers

SMB owners are not email-savvy, and while we discussed various strategies to engage them: top medium of communication was WhatsApp, and top medium to share a new concept or thought was videos. A lot of SMB owners follow up and keep their customer updated through WhatsApp, and are used to seeing videos to learn something new.

Hope these were useful for people building for the next billion businesses which are coming online!

Previously published at https://medium.com/@richaverma8792/building-for-smbs-6-lessons-from-yc-startup-school-delhi-meetup-1-4ccd1ae8de