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How and when to build marketing teams at deep tech companies

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Deep tech startups develop cutting-edge innovations with the power to truly revolutionize society. The founding team members at these companies often come from deeply technical backgrounds, which powers rapid product progress but can create bottlenecks on the go-to-market side.

In this post, I outline the answers to four key questions around marketing at early-stage deep tech companies that are post-revenue:

  • What marketing teams at deep tech companies do.
  • When to hire the marketing team.
  • Whether the marketing team needs industry experience.
  • How to source and evaluate talent for the marketing team.

From this post, deep tech startups can formulate their marketing hiring strategy and attract and cultivate top talent to drive their go-to-market plan. Without business execution, even the most groundbreaking innovations do not achieve their intended impact.

What do marketing teams at deep tech companies do?

To set the context, I share below the typical projects of deep tech marketing teams, which look different from marketing in other industries given the greater product focus and complexity, regulatory oversight and longer time to market.

Go-to-market

Marketers leverage the strength of the IP to establish collaborations with large companies, such as pharma companies and institutions, such as the government, universities or hospitals. To this end, marketers develop creative ways to gather lists of, and information on, key contacts at these potential partners. They also build sales collateral, such as demo videos, pitch decks and one-pagers, to more effectively reach and build long-term relationships with these prospects.

More broadly, marketers also develop the go-to-market strategy beyond partnerships. To this end, marketers conduct in-depth market research on business models, monetization strategies and reimbursement channels.

Communications

Marketers create original content to establish the company as a thought leader, build the company’s brand credibility through social media and apply for awards and honors to validate the potential of the company’s solution.

Forecasting

Marketers work with finance and product teams to formulate projections as the company moves into the clinical phase.

When should deep tech companies hire marketers?

The CEO and other members of the founding team take on marketing work in the formation stage to better understand and empathize with the needs, capabilities and opportunities in the department before bringing someone on full time.

Once the product shows signs of repeatable revenue, a marketing lead is needed. Specifically, this is ahead of a large Series A round, after a small Series A round or when a commercial partner has expressed interest in larger, long-term contracts. Instead of the typical chief marketing officer or chief revenue officer title, deep tech startups call this person a chief commercial officer or chief partnerships officer.

For additional support in the formation stage, companies bring on MBA interns and work with their investors. Prior to the Series A, platform teams at deep tech venture-capital funds are hands-on in helping with marketing through actually doing marketing projects for their portfolio companies, ideating on long-term marketing strategy with the founders through regular feedback sessions and connecting founders with vetted marketing contractors or agencies.

For companies that require FDA approval, commercial advisors, consultants and board members fully take on the partnership strategy work (which represents the bulk of the marketing needs) prior to the Series A round. Similarly, external consultants, such as marketing agencies, can take over major projects like launch strategy. External consultants can then join the team should their performance be strong.

For drug-development companies, the marketing leader is most crucial when the company enters the clinical phase and prepares for trials, regardless of funding stage.

Do marketing hires need industry experience?

Of course, it is ideal to hire someone with experience selling into the space and someone who is comfortable with the complex supply chains and long sales cycles. However, if the choice is between someone with functional expertise but no industry expertise and someone with industry experience but limited or no functional expertise, it is better to hire the former candidate and leverage the rest of the team for domain expertise. Deep tech is a niche area, so the other team members can support the marketer in developing industry expertise.

Lyron Foster is a Hawaii based African American Musician, Author, Actor, Blogger, Filmmaker, Philanthropist and Multinational Serial Tech Entrepreneur.

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What China’s Big Tech CEOs propose at the annual parliament meeting

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The annual meetings of the Chinese parliament and its advisory body are underway in Beijing this week. Top executives from some of China’s largest tech firms are among the thousands of delegates who attend and put forward their opinions. Here is a look at what the tech bosses are proposing for China’s digital economy.

Pony Ma

More regulatory scrutiny is needed for the country’s budding internet economy, Tencent’s founder and CEO Pony Ma says in one of his proposals, according to a report from the state-backed People’s Posts and Telecommunications News. As a delegate of the National People’s Congress, Ma has submitted over 50 proposals during the parliament meetings over nine consecutive years, said the report.

Specifically, Ma calls for strict governance on peer-to-peer finance, bike-sharing, long-term apartment rental and online grocery group-buying, fledgling areas that have also seen businesses go bust amid cash-hemorrhaging competition.

Ma’s comment comes at a time when regulators are tightening their grips on the country’s tech giants. In recent months, the government has launched probes into Alibaba and other tech firms over anti-competitive practices and proposed a sweeping data law that will limit how platforms collect user information.

Lei Jun

In China’s grand plan to move up the manufacturing value chain, Xiaomi, which makes smartphones and a slew of other hardware devices, has been keen to help factories upgrade.

Xiaomi CEO Lei Jun, a delegate of the NPC, recognizes China is late to smart manufacturing, lacks home-grown innovation and is overreliant on foreign technologies, he says in his proposal. Research and development efforts should be directed to key components such as cutting-edge sensors and precision reducers for factory robots, he says.

China also lacks the talent for advancing factory innovation, Lei points out, thus government policies should support corporations in attracting foreign talent and cultivating collaboration between industries and academia.

Robin Li

As part of its artificial intelligence pivot, Baidu, China’s biggest search engine service, has invested heavily in smart driving tech. Regulation is a major hurdle for autonomous driving firms like Baidu that need large volumes of data to train algorithms, and the rate at which testing permits are issued varies greatly across regions.

Robin Li, CEO of Baidu and a member of the Chinese People’s Political Consultative Conference, urges regulators to be more innovative and pave the way for legal and at-scale commercialization of autonomous driving. A mechanism should be created for various government agencies, industry players and academia to collectively promote the commercial deployment of autonomous driving.

In addition, Li calls for more senior-friendly technologies, greater public access to government data, and better online protection for underage users in China.

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Indonesian logistics startup SiCepat raises $170 million Series B

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SiCepat, an end-to-end logistics startup in Indonesia, announced today it has raised a $170 million Series B funding round. Founded in 2014 to provide last-mile deliveries for small merchants, the company has since expanded to serve large e-commerce platforms, too. Its services now also cover warehousing and fulfillment, middle-mile logistics and online distribution.

Investors in SiCepat’s Series B include Falcon House Partners; Kejora Capital; DEG (the German Development Finance Institution); Telkom Indonesia’s investment arm MDI Ventures; Indies Capital; Temasek Holdings subsidiary Pavilion Capital; Tri Hill; and Daiwa Securities. The company’s last funding announcement was a $50 million Series A in April 2019.

In a press statement, The Kim Hai, founder and chief executive officer of SiCepat’s parent company Onstar Express, said the funding will be used to “further fortify SiCepat’s position as the leading end-to-end logistics service provider in the Indonesian market and potentially to explore expansion to other markets in Southeast Asia.” SiCepat claims to be profitable already and that it was able to fulfill more than 1.4 million packages per day in 2020.

The logistics industry in Indonesia is highly fragmented, which means higher costs for businesses. At the same time, demand for deliveries is increasing thanks to the growth of e-commerce, especially during the COVID-19 pandemic.

SiCepat is one of several Indonesian startups that have raised funding recently to make the supply chain and logistics infrastructure more efficient. For example, earlier this week, supply chain SaaS provider Advotics announced a $2.75 million round. Other notable startups in the space include Kargo, founded by a former Uber Asia executive, and Waresix.

SiCepat focuses in particular on e-commerce and social commerce, or people who sell goods through their social media networks. In statement, Kejora Capital managing partner Sebastian Togelang, said the Indonesian e-commerce market is expected to grow at five-year compounded annual growth rate of 21%, reaching $82 billion by 2025.

“We believe SiCepat is ideally positioned to serve customers from e-commerce giants to uprising social commerce players which contribute an estimated 25% to the total digital commerce economy,” he added.

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InsurGrid raises pre-seed financing to help modernize legacy insurance agents

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Insurance agents spend hours handling paperwork and grabbing client information over the phone. A new seed-stage startup, InsurGrid, has developed a software solution to help ease the process, and make it easier for agents to serve existing clients — and secure new ones.

InsurGrid gives agents a personalized platform to collect information from clients, such as date of birth, driver’s license information and policy declaration. This platform helps agents avoid sitting on long calls or managing back-to-back emails, and instead gives them one spot to understand how all their different clients function. It is starting with property and casualty management.

The startup integrates with 85 insurance carriers, serving as the software layer instead of the provider. Using the InsurGrid platform, insurers can ask clients to upload information and within seconds be registered as a policyholder. This essentially turns into a living Rolodex that insurers can use to access information on the account, and offer quotes on a faster rate.

Image Credits: InsurGrid

There’s a monetary benefit in providing better service. Eden Insurance, a customer of InsurGrid, said that people who submit information through the platform converted at an 82% higher rate than those who don’t. Jeremy Eden, the agency owner of Eden Insurance, said they were able to show consumers that its plan was $300 cheaper than its existing rate.

At the heart of InsurGrid is a bet from the founding team that legacy insurance agents aren’t going anywhere. Co-founder/CEO Chase Beach pointed out that the majority of the $684 billion of annual property and casualty insurance premiums in the United States is distributed by approximately 800,000 agents working in 16,000 brokerages. So far, InsurGrid works with more than 150 of those agencies.

When asked if InsurGrid ever had plans to offer its own insurance, similar to insurtech giants Hippo, Lemonade and Root, Beach said that it is solely working on innovating around the sales process for now. He said that these big companies, which have either recently gone public or are planning to, still rely on agents to be successful.

“Instead of us replacing the insurance agent, what if we gave them that same level of technology of a Hippo or large carrier,” Beach said. “And provide them with the digital experiences so they can compete in 2021.”

As time goes on, he sees insurance agents taking the same role that financial advisors or real estate agents take: “very much involved in the process because they are that expert.”

Other startups that have popped up in this space include Gabi, Trellis and Canopy Connect. The differentiator, the team sees, is that Beach comes from a 144-year-old insurance legacy, giving him key insights on how to sell to agents in a successful and effective way. It is starting with sales, but expect InsurGrid to expand to other parts of the insurance process as well.

To help them compete with new and old startups, InsurGrid recently raised $1.3 million in pre-seed financing to help it fulfill its goal to be the “underdog for the underdogs,” Beach said. Investors include Engineering Capital, Hustle Fund, Vess Capital, Sahil Lavingia and Trevor Kienzle.

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