611. Ilya Druzhnikov and Alex Lugosch, Using Cold Calls to Find Product-Market Fit

Key takeaways

True PMF helps companies validate their product-market fit through a rapid and structured approach involving cold calling.
Cold calling serves as a method to gather real-time feedback from potential clients, allowing for quick iteration on pitch strategies.
Traditional sales development representatives (SDRs) may not be effective in complex B2B environments, necessitating more skilled strategies.
Alex and Ilya emphasize the importance of focusing messages based on audience-specific insights gained through direct conversations.
Successful client engagement often requires being open to pivoting strategies based on market feedback and analytics.

Summary

Introducing True PMF

In this episode, Will Bachman welcomes Alex LaGosch and Ilya Druzhnikov from True PMF, a specialized firm focused on rapid prototyping and discovery for startups and established companies. The episode starts with an explanation of True PMF’s unique approach to helping businesses validate their product-market fit at a much faster pace than the traditional six-month process, emphasizing the importance of referrals for engagement with their services.

Cold Calling to Discover Product-Market Fit

Alex and Ilya provide a deep dive into the mechanics of their cold calling strategy. They highlight how they identify a founder’s target audience through tools like ZoomInfo, build a list of potential clients, and then engage those clients directly via cold calls. This iterative process helps gauge reactions and refine pitches quickly, significantly compressing the timeline for product-market fit.

Iterative Learning through Conversations

The duo discusses their approach to learning from cold calling interactions—not just for securing leads but to gather insights about messaging and audience preferences. Each call is analyzed immediately after, feeding back into their AI model to iterate and enhance the pitch. They emphasize the importance of engaging with specific audiences and adjusting strategies based on direct feedback.

Cost and Effectiveness of SDRs

A critical segment covers the cost-effectiveness of traditional sales development representatives (SDRs) in cold calling. Alex and Ilya express skepticism about unskilled SDRs handling complex B2B sales effectively. They detail how their methodology provides a more targeted approach that saves money and delivers better results, transitioning from cold calling to a strategy that emphasizes data-driven marketing.

Client Success Stories and Lessons Learned

Alex and Ilya share specific examples of their clients, illustrating how they pivoted strategies based on market feedback. They recount a valuable lesson learned while targeting high-growth e-commerce brands—shifting to established brands wanting margin expansion instead, which led to higher engagement and relevant conversations.

Background of the Founders

The episode concludes with the backgrounds of Alex and Ilya, both seasoned founders with rich experiences in various sectors such as fintech, e-commerce, and venture capital. They discuss their motivation and passion for helping other founders achieve product-market fit, showcasing their recent emergence as a consulting duo.

Show notes

Show Notes:

Alex Lugosch and Ilya Druzhnikov, founders of True PMF, explain that True PMF is a rapid prototyping and discovery service for startups and established companies who are releasing a new product or testing a new market and don't have the tools or six to eight months to try new experiments for product market fit. The firm uses cold calling tools to test out different ideas and pitches to potential clients, focusing on understanding the reactions of potential buyers. Ilya explains how their tool saves time and money by improving the cold call process.

First Steps in a Cold Call Strategy

Alex and Ilya work with a founder to identify their target audience and use tools like ZoomInfo to gather a list of people that fit that profile. They then use cold calling tool to test out different ideas and iterate different pitches to potential clients. They also train the founder to do cold calls, helping them understand the process and find what resonates with potential buyers. The firm often stacks rank lists of 20 audiences to test in the next 20 days, with each experiment taking about two sessions of an hour each. At a certain point, they do turnover, where the founder takes over to learn how to do the process. They use several list building services, data validation services, and dialers to build tight lists, accessing many people at the C-suite that most founders can only dream of contacting. Within one or two calls, they find that those people are picking up on their pitches and talking to them, which is a significant improvement from the traditional six-month process of trying to determine if something is a product market fit.

The Cold Call Conversation and Analysis

Ilya explains the process, beginning from when they contact the founder, building the initial list, finding direct phone numbers for 80-100 people, and loading them into their enterprise-grade tech stack that few startups can afford. He goes on to explain how they start the conversation. They try to make the pitch relevant to the founder and explain that their solution could save time and money while having a positive impact on the bottom line. After the call, the transcript goes directly into the AI model, which produces an analysis of the conversation and offers recommendations on how to proceed. The next step is to determine the outcome of the call. In a typical calling session, there are sometimes upwards of 14 or 15 connects. As the conversation gets closer to the target, the conversations become more rich, with more follow-up emails, scheduled demos, and referrals. It's an iterative process until discovering the audience is interested in the topic and/or the call can be referred to the right person.

Cold Calling Techniques

The conversation turns to the importance of effective cold pitching techniques. They mention the importance of recognizing what's currently relevant to the client. They also discuss the concept of partnering one person to take a pitch and then alternate to the other person without giving feedback. The key to getting better at cold pitching is focusing on the elements that work in the previous pitch. This technique can be applied to other situations as well, such as listening to each other's tone of voice and understanding their preferences. Alex emphasizes that these techniques are not meant to scale sales but to provide relevant information about messaging and product features that can be used in outbound campaigns that are scalable, such as emails, LinkedIn messages, or conferences. Ilya and Alex give an impromptu example of an opening conversation with mid-market private equity owned portfolio companies. Ilya explains that their informs more effective marketing strategies. This approach helps clients narrow down their ideas about the persona, develop stronger content that connects with their target market(s), and ensures that their marketing efforts are highly effective.

Cost of SDRs Cold Calling

The discussion revolves around the cost of cold calling sales development representatives (SDRs) and their effectiveness in B2B product spaces. Emphasis is placed on understanding the messaging and the potential for managing costs. They mention a company with 400 clients across Europe that raised over $50 million and had six SDRs, but none of them were effective. They also mention that a multinational tech startup with a large B2B sales team cannot afford six CROs to run their sales team. They advise against giving cold calls to unskilled SDRs, as they may not be adaptable enough to handle complex situations. However, cold calling is a good prototyping tool, as it allows companies to reach a wider audience, gain insights and understanding of their market, and potentially increase their revenue.

Examples of How TruePMF Serves Clients

Alex and Ilya initially focused on high-growth e-commerce brands, but later discovered that they needed to target established e-commerce brands looking for margin expansion. They created a new list of these brands and tested it with CTOs, which proved more relevant. Then, they called private equity partners, specifically tech stack operating partners, to expand their reach. This allowed them to sell their solution across multiple brands. Another example is a smaller company with 20 clients, all big enterprise clients, looking to sell to private equity firms. Ilya also discusses the process of selling a product before building it, and emphasizes the importance of honesty and transparency in the sales process.

About the Founders of TruePMF.com

Alex Lugosch, a FinTech founder and executive at a wholesale, e-commerce company, and the B2B credit space, and Ilya Druzhnikov, a serial entrepreneur and angel investor, have both been working with founders and CEOs to help them understand Product Market Fit. They have worked in various industries, including B2B wholesale, e-commerce, and angel investing. The website, Pmf.com, is by referral only, and they have a bias for working with serious people who are serious about their business. They require founders to attend every call, including the CEO, Chief Revenue Officer, and Head of Sales. The company has sold their product to 400 companies across Europe and is coming to the United States.

Timestamps:

00:02: Introduction to True PMF and Their Unique Approach

03:28: Explaining the True PMF Service

06:35: Detailed Walkthrough of the Process

10:47: Iterative Improvement and Audience Targeting

16:29: The Role of Cold Calling in Business Development

34:04: Client Examples and Success Stories

40:23: Background of Alex and Ilya

Links:

Website: https://truepmf.com/

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