At some point when you're building your company, you'll inevitably encounter a potential customer that just isn't quite right for your business. Learning to say no to business was a lesson I learned early on, and it's something I've had to do repeatedly to make sure my business thrives.
We routinely turn down five to 10 clients every day at my native advertising platform company StackAdapt. Hesitant to turn down business? Here are three reasons you should consider leaving money on the table.
1. Your customers define your product. In order to get your startup off the ground, it's important to nail your product/market fit. Landing a big-name customer may seem like the answer to your prayers, but in my opinion, it's better to stay away from the heavyweights until you've fine-tuned the fundamentals of your business.
Having a large client as one of your beta customers might mean that their business could end up defining your business and the evolution of your product. This could result in one of two scenarios: In an ideal world, it will help shape your product into something that better solves whatever market problem you're trying to fix. In a not-so-ideal world, it will end up dragging you into a rabbit hole of security reviews and lengthy sales cycles that could see you burning through what limited cash you have.
2. Reputations can be lost in a click. In the digital age, it's near impossible to shake off a bad reputation. That's why it's essential to align yourself with the right partners – not just the ones who are prepared to pay. After all, a good reputation is priceless and may lead to referrals down the road.
Of the customers we turn down, 90 per cent are because we take issue with their business ethics, and we turn down the remaining 10 per cent because the quality of their content doesn't meet our standards. At StackAdapt, we have an obligation to our clients to keep them in good company with brands and publishers that are trusted, ethical and relevant, and sometimes that means turning down revenue. If you're in it for the long haul, this should be a trade-off you're willing to make.
We also have a responsibility toward consumers, because at the end of the day, they're the reason we're in business. We want to go to sleep at night knowing that we're helping make the entire web ecosystem a better place for users.
3. Existing customers might not be the right fit now. We don't just turn down customers at the onset; we also part ways with ones that have evolved from the time we onboarded them. It's natural that businesses change, and it's never been easy to walk away from an existing partnership. But reflecting on your long-term plan might reveal that you need to sever a few ties to keep growing. Your ideal client will inevitably change as your business and product evolves, so revisit your initial customer profile often and ask yourself whether your current clients meet this standard.
Turning down or firing clients is never fun, but it is necessary. By being picky and turning down the wrong customers, you're attracting the right customers – and being selective is truly the way to build a great business.
Vitaly Pecherskiy is co-founder and COO of StackAdapt, the world's largest platform for branded content distribution. He can be found on Twitter at @vitalypecherski.