By Jeannette Bitz
That's Rule 11 in an article titled 'Mark Cuban's 12 Rules for Startups' published by Entrepreneur in 2012. The article generated a fair amount of attention but only recently fell on my radar. Many of Cuban's rules, however, are still valid. Rule 3, for example: 'Hire people who you think will love working there', and Rule 5, 'Know your core competencies and focus on being great at them.' But Rule 11? No way is it good advice.
While Rule 11 might work for Cuban, your typical tech startup is not founded by an extraordinarily famous multibillionaire whose every business move generates press coverage. Unfortunately, rule 11 really speaks to the bias many still have against PR firms. And it doesn't take into account personality or how time-consuming a good PR program is.
Even startups founded by people well-known in their fields often employ PR firms to ensure a successful launch. Perhaps an entrepreneur is brilliant and understands PR, but is introverted and prefers leaving it to the professionals. Or a founder can charm the media off their feet but has a bazillion other things to do; launching a company and generating sustained coverage is a full-time job.
It's true that if you hire the wrong firm - one that isn't focused on your market, doesn't understand your product, and doesn't have excellent relationships with the right editors and analysts - your big launch might turn into a big fizzle. Right now, in fact, Engage is in the process of re-launching a company that was launched badly the first time around. But if you're smart about hiring the right PR firm - one that understands your market and your product and knows the influencers - your launch can be a big success.
Big Lake, Little Fish
Startups are often like little fish jumping into a big lake with lots of hungry big fish (aka competitors) fighting to be at the top of the food chain. And these big-fish companies have plenty of money to spend on PR. So if the media doesn't automatically follow your every move, your go-to-market strategy has to include PR.
As a startup, you face certain challenges. Resources are limited, executives often wear multiple hats and larger incumbent competitors have more money and resources. And you only have one chance to get your message out to customers and make a strong first impression. A smart, focused, full-service PR program can help you overcome these challenges and launch your company successfully. Great PR enables you to establish and build your brand and gain mindshare now. It clarifies your story. It helps you prove your product/business model is sound by telling your customers' stories. It helps you generate leads. It helps you raise money by gaining the attention of analysts and influencers. And finally, great PR makes your business more attractive for an equity event, whether an IPO or a buyout.
Focus, Focus, Focus
To get great PR, you need a firm that's focused on your market, one that can give you an insider's perspective and has a record of success. At Engage, for example, we focus on the cloud infrastructure, mobile and telecom infrastructure markets. That focus enables us to align client companies and find synergistic opportunities for them. We have deep relationships with the media, the analysts and other influencers in the markets we serve. And because we understand our clients' customer base and where they get their information, we know how to target customers and how to make effective use of SEO and appropriate social media.
Engage has launched 50 companies since it was founded, so we understand what it takes to make your startup stand out from the pack. We help our clients make effective use of the right communications channels to support their business strategy. If your strategy is to be acquired, you need to build relationships with the business press. If you want a channel for sales, you need a communications strategy that encompasses the trade press, business press and social media. And you need to know how to distribute which content to which channels.
What a PR Firm Can Do for You
How else can a PR firm help a startup? First and foremost, PR helps you communicate your unique viewpoint on your market. Startups typically don't generate a lot of news, but a good PR program can gain critical coverage by positioning you as an expert on the bigger picture.
- The media look for experts, particularly serial entrepreneurs, who will share their insights on new trends and technologies. If you don't share yours, your competitors will share theirs.
- If you do not consistently communicate your point of view, the media will be unclear about your positioning and your competitors could misguide them about your company.
- Creative and consistent PR lets your customers know your business is strong.
- PR is a platform for communicating with current and prospective customers, investors and partners.
- You can use PR to extend coverage beyond news releases and drive customer interest in your market.
Good PR support is also critical in helping executives build relationships with the editors, analysts and bloggers who cover their market and in navigating the changing media landscape.
- Good relationships help you shape the competitive landscape to your advantage.
- If you're a consistent resource, reporters and analysts may add you to their rolodexes and call to get your point of view.
- If you're not having regular dialogues with industry influencers, they may quickly forget your company or speculate that something is wrong.
- If you don't understand the evolving new-media landscape or know the players, you risk missing out on important PR opportunities.
Ditch Rule 11
Launching a startup is a complex process, requiring excellence in every area, from initial idea, to product development, engineering, sales and marketing. If you're going for excellence, why rely on amateurs when you're launching your company? The right PR firm has the resources, the contacts and the know-how to maximize the success of your startup.
I won't argue that Mark Cuban isn't a brilliantly successful businessman. And I won't argue that his 12 rules for startups don't, on the whole, provide excellent advice. But Rule 11, ‘Never hire a PR firm’? I'd ditch it.