<story><title>Don&apos;t Talk to Corp Dev (2015)</title><url>http://www.paulgraham.com/corpdev.html</url></story><parent_chain><item><author>duxup</author><text>&amp;gt;If they can, corp dev people like to turn the tables on you. They like to get you to the point where you&amp;#x27;re trying to convince them to buy instead of them trying to convince you to sell.&lt;p&gt;I worked for an established company (not a startup) and had a run in with Wal-Mart.   Wal-Mart managed to buy some stuff at an ultra low discount because ... someone thought maybe if we get in there we could sell tons to their IT team.&lt;p&gt;Meanwhile I&amp;#x27;m working with their IT guys.  They hate the product.   They tell me in no uncertain terms and in every unprofessional way you can imagine (that part was pretty shocking).   Of course what they&amp;#x27;re really doing is just buying the minimum and pounding the hell out of support with complaints as they pump 20 gallons into 10-gallon hat of our product.&lt;p&gt;What happens?  We keep providing them free services, extra services.  The folks at the top think they&amp;#x27;re at the tip of a big sale, big money despite myself and others telling them &amp;quot;These guys don&amp;#x27;t like our widget, they don&amp;#x27;t want it... and they&amp;#x27;re not capable of even making good use of it.  All while giving it to them for free, why would they pay a dime more?&amp;quot;&lt;p&gt;By the end I hear we&amp;#x27;ve made like our 5th pitch to them that is barely profitable for us... just on the face value of the product and support.  Somehow Wal-Mart convinced these guys to take a &amp;#x27;big sale&amp;#x27; moment and turn it into a loss if you consider all the time put into working with them.  And they were happy to do it.&lt;p&gt;Finally we had a stroke of luck, we were acquired, and the new CEO had worked with Wal-Mart before as a customer and cut them lose.   Finally all that effort and energy that went into this big deal that never happened (probably for 18+ months) could be put to use with better customers.&lt;p&gt;It&amp;#x27;s amazing how some folks can over time convince other people to actually propose a bad deal... for themselves.</text></item></parent_chain><comment><author>nimbix</author><text>The company I worked for had a pretty much identical experience with Unilever: they aggressively reduced the scope of the contract, but expected all the extras anyway; then at the end of the contract made the company choose between getting paid for all the overages, or extending the contract. They never even really needed us if you ask me; we were primarily used as a tool for one group of execs trying to one-up another group who was backing a competitor. Eventually it all lead to us having to integrate with that competing company... until said competitor suddnly went out of business (helped by their Unilever deal, no doubt). Of course the management&amp;#x27;s objective was keeping them as a client at any cost because having them as a reference would open up so many opportunities (it didn&amp;#x27;t really).&lt;p&gt;It will come as a surprise to many people, but it&amp;#x27;s quite possible to lose a ton of money on a toxic client who is paying you millions. Avoid such &amp;quot;white elephant&amp;quot; clients at any cost. And really, the last thing you need in your life is getting dragged into some huge conglomerate&amp;#x27;s internal politics.&lt;p&gt;I never worked with Singapore Airlines, but people who have experience with them tell me they&amp;#x27;re even worse in the sense that they allegedly have a policy of not paying for software - you get to give them free stuff in exchange for being able to list them as a client. Huge software companies can afford to do that; your growth stage startup probably can&amp;#x27;t.</text></comment>
<story><title>Don&apos;t Talk to Corp Dev (2015)</title><url>http://www.paulgraham.com/corpdev.html</url></story><parent_chain><item><author>duxup</author><text>&amp;gt;If they can, corp dev people like to turn the tables on you. They like to get you to the point where you&amp;#x27;re trying to convince them to buy instead of them trying to convince you to sell.&lt;p&gt;I worked for an established company (not a startup) and had a run in with Wal-Mart.   Wal-Mart managed to buy some stuff at an ultra low discount because ... someone thought maybe if we get in there we could sell tons to their IT team.&lt;p&gt;Meanwhile I&amp;#x27;m working with their IT guys.  They hate the product.   They tell me in no uncertain terms and in every unprofessional way you can imagine (that part was pretty shocking).   Of course what they&amp;#x27;re really doing is just buying the minimum and pounding the hell out of support with complaints as they pump 20 gallons into 10-gallon hat of our product.&lt;p&gt;What happens?  We keep providing them free services, extra services.  The folks at the top think they&amp;#x27;re at the tip of a big sale, big money despite myself and others telling them &amp;quot;These guys don&amp;#x27;t like our widget, they don&amp;#x27;t want it... and they&amp;#x27;re not capable of even making good use of it.  All while giving it to them for free, why would they pay a dime more?&amp;quot;&lt;p&gt;By the end I hear we&amp;#x27;ve made like our 5th pitch to them that is barely profitable for us... just on the face value of the product and support.  Somehow Wal-Mart convinced these guys to take a &amp;#x27;big sale&amp;#x27; moment and turn it into a loss if you consider all the time put into working with them.  And they were happy to do it.&lt;p&gt;Finally we had a stroke of luck, we were acquired, and the new CEO had worked with Wal-Mart before as a customer and cut them lose.   Finally all that effort and energy that went into this big deal that never happened (probably for 18+ months) could be put to use with better customers.&lt;p&gt;It&amp;#x27;s amazing how some folks can over time convince other people to actually propose a bad deal... for themselves.</text></item></parent_chain><comment><author>nkozyra</author><text>I had two of these moments, both with former top 3 tech giants (they were both far removed from the top by the time we talked).&lt;p&gt;The first gave us all sorts of access to their products first, presumably to see how our product would utilize them. And we used this as selling point to customers, not recognizing that we were kind of doing advertising for that other company as well as removing a barrier to customer acquisition. Nearly eight months in and that relationship petered out.&lt;p&gt;Second was more exciting. They came in loud and excited and had recently made some 9 figure acquisitions. They wanted to move quick so they started some technical evaluations. Tons of questions, requests, ideas, meetings, handoffs, etc. After four months of this we kind of got sick of doing their bidding without any timeline for how the process might go. After pressing a few times, they went cold. Our assumption was they were initially interested in a deal but moved into make-it-feel-like-we&amp;#x27;ll-be-family-soon-so-they-share-way-too-much mode.&lt;p&gt;I believe the second group was intent on just replicating what we had but I watched them closely and nothing materialized. I suspect given the resources they devoted the project collapsed there or was repurposed to a subsidiary.</text></comment>