White Paper:
Why startups need marketing to succeed.
Written by Kulin Marketing
Affordable high-end marketing development services for startups.
www.KulinMarketing.com
For questions, comments, or to start marketing the right way contact: info@kulinmarketing.com

Kulin Marketing – White Paper: Marketing for startups www.KulinMarketing.com
OVERVIEW:
Eric Ries of the Lean Startup defines startups as, “a human institution designed to create new
products and services under conditions of extreme uncertainty.” But at what point do startups
start marketing? Many new companies start marketing without even knowing it. For example,
choosing a name, a slogan, and a key message (the phrase you repeat over and over to your
target market) are all marketing decisions. Furthermore, brand strategy is used to reach these
decisions. You have to know what you are, who you are for, and what problem you are solving
in order to determine characteristics that enable you to decide on brand elements and
messaging. Sometimes, however, companies bypass these first steps and go with gut decisions
based on minimal research or rationale.
Take one of our current clients, an internet technology company with great products and
services, but it always suffered from low brand image. For years, this technology company
called itself an ad server, positioning itself as a direct competitor to Google’s DoubleClick ad-
serving platform. Continuously struggling in the shadows of this huge market leader, our client
was not reaching its true potential. It focused on development of products and services that it
believed its target market wanted, promoting them with a heavy focus on product-based
messaging. Their target market struggled to see the difference between our client and
Ever asked: DoubleClick, and the market leader’s brand equity over shadowed the growing company. A
• What are we? marketing decision was required. In 2010, Kulin Marketing Founder Elizabeth Kulin
• How will we compete with recommended that our client re-categorize as an Advertising Technology provider offering
existing big brands?
multiple products and services (the ad server being one of them). This enabled our client to
• What problem are we solving?
position itself as an indirect competitor to Google. The company was able to continue to
• For whom?
• How do we reach them? market the same audience and, with a few changes to their messaging, showcase how they were
• How do we get them to buy? different, what problem they solve for their target audience, and why their value propositions
were different than Google. It was a marketing decision that has led to an increase in revenue
year after year.
Many startups fall into this same situation. It can be difficult to understand how your new
product of service can be unique in a crowded space. How you could be different from the
market leader, and which avenue is the smartest to take. It requires research, insights, and ideas.
All of which are inclusive in a strategic marketing plan. Some startups take this project on
90% of startups never make it. internally, but others understand that marketing is a true discipline with various components
Marketing can increase the chance of and specialties, and one that should be left to the experienced. Some believe that they will be
survival. successful without spending time on brand strategy and marketing planning. Some might be,
but more than often these startups become part of the 90% that fail.

Kulin Marketing – White Paper: Marketing for startups www.KulinMarketing.com
STARTUPS NEED MARKETING:
Marketing has become one of the most important additions for startups. Its fundamental
purpose is to grow brand awareness, acquire sales leads, and retain customers. It includes
multiple tactics and disciplines; however, at the end of the day, the principles of marketing are
simple: “Selling the right thing, to the right people, at the right time.” (Seth Godin, Meatball
Sunday; Is your Marketing out of Sync?).
A startup must possess that “right thing,” first and foremost. But marketing can take it from
there. Marketing can help select the right people to target, the right times to communicate with
them, the right words to use when communicating with them, and the right vehicle
(advertising, online communities, email, etc.) to use to reach them. These decisions occur first
in what is called a marketing plan. Many people in business believe that the reason nine out of
10 new businesses fail is because most of them did not develop a marketing plan at the right
time (or at all).
There are many risks associated with starting a business, but with good planning and
preparation, the chances of success increase. Marketing is essential, but it can be the most
challenging aspect of starting a business. Many startups lack the time or energy until it is too
late. This white paper outlines three reasons why marketing is critical for a startup.
WHY STARTUPS NEED MARKETING DURING DEVELOPMENT:
1. For your brand
As a startup founder, you become part of your brand. It just happens. It can become nearly
impossible to be objective, and almost impossible to make an objective decision. But a non-
biased, objective point of view from the outside in is exactly what your startup needs to startup
In 2010, author of ‘Startup from the the right way and to build a solid branding foundation for your brand elements, key messages,
Ground Up’ Cynthia Kocialski and competition strategy.
wrote, “Start-ups need a marketing
plan because these days investors are In January 2012, Inc. Magazine wrote, “What does your Company Look Like From the
not interested in funding companies Outside?” The article claimed that if a CEO could see their company from an outside point of
that don’t know how, where and to view that they would, “change at least one fundamental way in which you currently
whom to sell their product or communicate with your various audiences.” Marketing can help you get this outside point of
service.”
view (via marketing research).
2. For your potential investors
Investors often want to see a marketing plan with a strong strategy of how you plan to enter the
market, grow equity, compete with others in your space, and win the most customers before
they provide seed capital (typically requiring a larger ROI than VCs) or a round of funding
(the venture capital industry has classified six stages of financial funding: seed money, start-up,
first-round, second-round, third-round, and fourth-round). There are three types of people
who might invest money in your business idea: friendly investors, hobby angels, and
professional investors (VC, angle/incubators, and banks). Startups looking for funding often
Funding Facts:
start by making a list of prospects. They scour their industry and networks and test a business

Kulin Marketing – White Paper: Marketing for startups www.KulinMarketing.com
In 2009 angel investors dished out pitch. The prospect list grows over time, sometimes middle men like venture lawyers are used
$17.6 billion to fund startups. (to help to connect entrepreneurs with investors), the gathering of interested investors is
compiled, and a strict closing date is set. Jason Fell of Entrepreneur.com goes into more detail
in “How to Raise Money for Your Startup – Now.” Securing funding for your startup is almost
Angle investors require high return like wining the lottery. If you aren’t planning to bootstrap it, funding and the amount received
because they typically fund at the
in total from investors can make or break the future of your business. Furthermore, as this
beginning when risk is highest.
graph below shows, the volume of startups receiving investment capital has declined steadily
since 2007. It is more difficult, than in recent years, for startups to win funding.
In 2007, the average capital raised
from angle investors was about
US$450,000 per startup.
More than ever before, startups need to turn to marketing as an asset, that can help develop a
great go to market and growth strategy to impress investors with, in order to increase their
chance of receiving funding. Not only are fewer startups receiving funding, there are more
startups to compete with for each deal. The Kauffman Index (below) shows that there was a
steady average of new businesses emerging annually between 1980 and 2005 (about 600,000),
but that the number of new businesses has been increasing year after year since 2006.
The most common investments by
angle funds are in
healthcare/medical, software,
industrial/energy, retail, and then it
services.

Kulin Marketing – White Paper: Marketing for startups www.KulinMarketing.com
A startup needs more than a great product or service; it needs a great idea. Investors will
investigate a startup’s idea via a technical and economical feasibility study. If the idea is not
feasible at the stage at which the startup is requesting funding, and the investor does not see
any potential in the idea, the investor will not consider financing the idea. However if the idea
is strong, rational, and well planned, the investor will consider providing funding to the startup.
Marketing is a critical section of the plan.
Steps to starting up the right way:
Marke&ng
• Strategic planning
• Branding
• Messaging
• Test
• Implement
• Manage
• Measure
• Improve
• Repeate

Kulin Marketing – White Paper: Marketing for startups www.KulinMarketing.com
HOW TO START:
A marketing initiative should always start with a plan. A strategic marketing plan provides a
business with the answers to such critical questions as:
• What are we?
• Who are we for?
• How are we different/special?
• Where will we sell?
• At what price point?
• What will we say?
• How will we say it?
• When will we say it?
• Which communication vehicles will/should we use?
The plan will include branding, as well as possible recommendations and insights that you
never thought of. The plan must be written from an objective point of view. This is because it
might disclose a completely different positioning and strategy than what was originally
believed to be the right one. It will either substantiate or challenge (and hope to change) a
startup’s current messaging. This is only the first step, yet the most critical one, for a startup
that wants to start marketing. Difficult decisions will be made, but they should be based on
rationale and research rather than gut or subjective inputs. It may be easier for you to
outsource this job, though it can certainly be done internally (basic/short marketing plan
outlines can be found at http://www.quickmba.com/marketing/plan/). Only do this
internally if you can be as objective as this initial introduction to marketing requires. Either
way, start now.
www.KulinMarketing.com
The consultants that make up Kulin Marketing believe startups strengthen the economy, and want to help them do just that.
Each member uses their specialty in marketing to help startups change the world.