Is All Publicity Really Good Publicity?
Is it true that any publicity is good publicity?
Courting the media when your startup doesn’t yet have a product can be a double-edged sword, says Ashish Mistry, a serial entrepreneur and co-founder of BLH Venture Partners, an Atlanta-based early-stage investment firm. “I’ve done it both ways, however in both instances I knew definitively that we would make the product,” he says.
Whether or not to take that course isn’t an easy choice. When asked about seeking publicity before your first product launches, experts resoundingly agreed: It depends on the company, the product and the market.
So before you decide to make noise, think carefully about what you hope to accomplish. Here are some things to consider.
Reasons to Do It
- To Hire: Some startup are active in meetups and other events in the local IT community, doing anything they can to get free publicity in hopes of gaining more traction with job candidates, says Ben Hicks, a partner in the Software Technology Search division at Boston recruitment firm WinterWyman.
- To Gauge Demand: “Given the importance of finding your audience and cultivating that audience into brand champions, courting the media as you near launch and announcing your solution openly is an incredible opportunity to build the foundation of your brand,” believes Dan Goldstein, director of client marketing at Toronto digital marketing agency Neumarkets. That might be true for consumer technology, but Indranil Guha, principal at Bain Capital Ventures’ Palo Alto office, doesn’t see enterprise customers lining up for a product based on pre-launch buzz.
- To Raise Funds: A devoted following and pre-market buzz can serve as a powerful negotiating tool when it comes to valuations, says Goldstein, who previously was group manager with the Ryerson Angel Network at Ryerson University in Toronto. “While nothing speaks better than revenue, being able to tout a community of potential customers who are involved in early iterations for your model is huge.”
Reasons Not To
- So You Can Perfect Your Idea: If an idea gains traction, the VC market will fund a half-dozen or so other companies going after the same thing. Playing your idea close to the vest can give you time to carefully study your market and build your technology.
- So You Can Gain Competitive Advantage: Because he was able to raise a substantial first round, Porch.com CEO Matt Ehrlichman said his company was able to quietly finalize partnerships for exclusive streams of data that will be the site’s differentiator. “It was not in our best interest to talk to the media. We wanted to be very quiet. We had enough money to put a team together and go get a lot of work done before we were known. So we could come out of that with a unique advantage … and start ramping up faster,” he says. However, Goldstein notes, “stealth mode” for startups has come to mean operating in silence with a few key “leaks.”
- So You Can Work the Bugs Out: “The challenge I see in Kickstarter-type ‘launches’ is that the media becomes involved in an overhyped process that in many cases leaves the consumer completely hanging. It’s a total tease,” says Mistry. “It also a leaves a credibility blemish on the entrepreneur … if the product doesn’t end up coming to market.” He stresses having a prototype so you can send the media something tangible to review.
Timing is everything, according to Goldstein. “Too often we see startups announcing too soon and hurting their business as they stumble publicly or are delayed in going to market, or losing out on any advantages they might have due to competitors with deeper pockets,” he says.
Announcing too late, however, could mean missing key opportunities to perfect your offering and generate pre-launch buzz that can help your startup gain the attention that’s much-needed for a full launch.
So, he advises, keep it simple: Focus first on your team, then the product. When you have something real, ramp up the networking to prepare for launch.