Guest Post
By Mark M.J. Scott
President of Northern Pixels Inc.
Scaling a deep tech startup for commercialization is a formidable challenge that requires founders to make significant shifts in their approach and thinking. The stark reality is that only 0.04% of startups reach $10 million in annual sales, which is just the beginning of proving commercial viability. Many founders, often from science or engineering backgrounds, excel in developing novel technologies but lack experience in crafting successful commercial strategies.
Shifting Mindsets for Success
Winning founders possess the unique ability to view commercialization expenditures, even at the earliest stages, as direct investments in increasing their startup’s valuation. Pre-commercial strategies that demonstrate product-market fit and generate high-quality awareness supported by advocates drive valuation and support future funding rounds. Commercial strategies should focus on generating a lucrative sales pipeline for highly coveted accounts, leading clients through a journey that extracts growing follow-on revenue and referrals, dramatically improving valuations.
When these strategies are devised and executed professionally, they can yield returns multiple times over the initial spend, propelling a startup ahead of competitors and forging a path to category leadership and success. Once a category leadership position is secured, it becomes nearly impossible to displace if managed and nurtured properly. Startups that establish an early market presence build brand reputation and relationships with industry leaders, setting the stage for future dominance.
Key Areas of Focus for Startup Founders
Understanding Commercial Positioning Versus Technical Differentiation
Positioning is critical for category leadership, especially at the earliest stages. While technical differentiation may attract early-stage investment, commercialization requires a more sophisticated positioning strategy. Identifying where a startup will focus and pursue opportunities is critical. This involves clearly articulating how your solution fits into the overall ecosystem, the positive business impacts it delivers, and the key differentiators that capture buyers’ attention. It is equally important to choose which markets or opportunities not to pursue. A foundational positioning strategy defines the startup’s purpose, the markets served, and why customers will choose your solution over competitors. Acknowledging the strength of competing solutions and how they resolve challenges for clients you will not pursue is crucial, as it develops internal alignment and focus without short-term distractions.
Brand Awareness That Drives Valuation Versus Public Relations
Many deep tech startups reach a stage where they need to elevate their brand, and founders naturally believe hiring a PR firm is the answer. However, public relations and media relations are just one arm of expertise that need to be synchronized with the organization’s strategy and interwoven with the larger marketing and commercial strategy. Effective strategies are built on a clear positioning foundation and validated by credible sources. Seasoned commercial leaders understand that awareness built on a positioning foundation and supported by advocacy not only garners higher quality media attention but also directly propels the business strategy. Credibility is achieved when prospects and existing customers passionately communicate your product’s market fit and positive business impacts. Awareness strategies without a positioning foundation or advocacy are budgets misspent.
The Shift of Priorities at Board Meetings from Product Development to Sales Pipeline
Founders face a dynamic shift in their board meetings several months before they approach commercialization launch day. Initially, the focus is on technical differentiators, product development pace, product readiness, talent acquisition, and regulatory hurdles. However, the focus shifts to the sales pipeline, which can be a difficult transition for founders if they are ill-prepared. This shift separates winning founders from the also-rans. If a founder has invested wisely and developed a strong commercial foundation, the shift will come more easily. It’s important for a founder to take stock of their leadership and ensure that all elements of the pipeline strategy are clear and 100% aligned with the business strategy and positioning. For many founders, it’s disorienting and akin to learning a new language, but those who adapt and learn increase their likelihood of success.
Some key considerations of your pipeline strategy include which teams will be responsible for generating the pipeline from what sources, crucial KPIs related to costs and conversion ratios, and what the lead-to-prospect-to-customer journey looks like, along with related revenue targets. A pipeline strategy is not the time for commercial teams to learn on the job; seasoned expertise is required to understand the intricacies and ratios that drive success. All commercial expenditures should be measured against the multipliers of pipeline created and revenue generated. Being “audible ready” for pipeline discussions at board meetings can help founders align boards to prioritize and resource required strategies to deliver on the vision.
Leveling Up Commercial Teams
Founders need to level up their commercial teams to match the talent of their product development teams. Scaling a deep tech startup for commercialization is a formidable challenge that requires founders to venture beyond their comfort zones. Success in this arena demands a willingness to explore and learn from the experiences of others. Learning involves questioning existing assumptions and being open to new approaches that may differ from their beliefs. By actively seeking out and embracing new insights, founders can position their startups for category leadership and significantly improve their chances of beating the odds.
About the author:
Mark M.J. Scott is President of Northern Pixels Inc., the world’s only marketing firm owned and operated by experienced deep tech / advanced tech startup marketing leaders, all of whom have successfully commercialized and exited via acquisition. Mark has played a leadership role in growing multiple deep tech successes, including a cryptography company acquired by AppDirect, an Optics company acquired by Toyota and a pioneering Enterprise Low Code Application Platform, TrueContext, acquired by Battery Ventures in 2024. Mark was recently hired by the Quebec, Canada Government’s Quantum Innovation Zone, $435M-funded, to devise a commercial strategy to bolster start-up success. Mark can be found on X / Twitter: https://x.com/MarkMJScott
