[Interview] Atomic's Path to 10 Customers
A practical 0-1 path using a customer advisory network
FYI! I am hosting a workshop on early-stage B2B sales with Eric Martin, Head of Sales at Vanta, on June 18th. Click here to register (it’s free, but attendance is limited).
This is a “pilot” of an interview series - let me know what you think!
I talk with 10-20 founders every week, and I’d like to start sharing some highlights.
Today’s conversation is with Michael Rossiter, co-founder of Atomic. Quick overview:
Atomic helps fast-growing consumer brands solve inventory and procurement planning headaches by moving from spreadsheets to software.
We started Atomic based on our experiences as planners; we built the product we would want to use. Atomic automates demand planning and restocking (PO generation) and continuously solves for supply chain optimizations and constraints (minimum order quantities, full truckload planning, dynamic safety stock levels). Planning in Atomic reduces wasted planning time and eliminates spreadsheet data errors.
Our typical client is a $25M-500M revenue brand that is on an ERP but still plans in spreadsheets. They are often experiencing low confidence in the plan and have elevated inventory levels or issues with stock outs. Within the first 6 months on our platform, our typical client sees 30%+ inventory reduction and 10%+ increase in stock rates.
I’ve worked closely with Michael and his co-founder, Neal. They used an advisory network to get their first 10 customers… and to figure out what exactly they’re selling & who they’re selling to.
These excerpts have been edited for brevity and clarity. If you’d like access to the full interview, drop me an email (rob@reframeb2b.com) and I’ll send you the link.
A few areas we dive into in this conversation:
Going from 0→1
Building and using an advisory network to generate sales momentum
How to get people to say ‘yes’ to being part of an advisory network
How Atomic figured out its pitch and product positioning
If you like this, let me know in a comment / reply / like… or forward to someone new.
Also, my founder-led sales bootcamp starts July 8 and pricing increases June 8. Link to more info here, link to a 3-min application here.
Like many of us, Michael has gone through a fun (?) transition from an “academic” role to a founder role:
I'm the co-founder of Atomic. I'm also a principal at DVx Ventures, a venture studio - we're a company that builds companies. I've been doing that for four years. I transitioned my role about two years ago from running more strategy-oriented, kind of academic work, to starting companies myself. So I flipped from more of the “investor / observer” mindset to the “founder.”
Atomic is a supply-demand optimization software product. We help companies that sell physical goods figure out how much of those goods to procure, when - so they can avoid stock-outs or excessive inventory.
We've been figuring out where our product is most resonating, which is with growing companies usually between $25-100M in revenue. These companies want to move from spreadsheets to something with more structure that they can trust.
My co-founder, Neal, built a similar technology at Tesla to run Tesla's supply and demand-matching system. We had a theory that we could apply this to any physical good and that theory is bearing out. But of course, with a technology like this, you see the customer need and the use case, and bringing those two pieces together … has been a journey.
At the time of the interview, Atomic had quickly gotten its first 10 customers, with a healthy contract size and a clear path to their next 25-50+.
The first few sales were messy, and that’s normal:
When we started out, we wanted to prove that this technology could work in a new context. So we took the logic of the technology we built previously and wanted to just grab a bunch of different companies and see what worked and didn’t.
Just like a lot of people do, we started with our friends. A bit lucky to have a business school background, and friends running reasonably big companies.
We reached out and said, “Hey, wanna try this new software we’re building?” Some said no, some said yes.
Once we got through our pals, it was like, shoot. We don’t have an endless ability just to scour our own personal networks and find more customers. So how do we find more customers? That’s when Rob suggested we do outreach on LinkedIn.
We tried a bunch of different messaging to connect with folks and start interacting, and the thing that worked the best was something like, “Hey, would you want to be our advisor?”
This messaging worked, but there was a problem.
We got these meetings and we’d show up and would basically say, “Do you want to buy this software?”
And people were like, “What are you talking about? First of all, what software? You can't even articulate what it is. But also, I thought this was an advisor call.”
And so we were churning through prospects. We felt bad about it, because it felt like a bait-and-switch… and it wasn’t working.
So Michael and Neal took a step back and asked, “What if we leaned into this?”
I remember going for a walk and talking with Neal through our options in terms of what to do. We had just 2 paying customers at that point, which were both personal relationships. And we set a goal to get to five ASAP.
Our options were to (1) change the messaging or (2) figure out what an advisor role would actually look like… with a path to them actually buying from us AND without it feeling like a bait-and-switch.
We asked ourselves, how would we feel in their position, being approached about this?
Where we landed was: We'll give equity grants. Small equity grants, but still something that compensated them for their time.
In return they would give us feedback on our demo, see if it was a good fit for their org now or sometime in the future, and make intros. We asked them to check in once a quarter, too.
As these advisor conversations started converting, Michael and Neal got tons of feedback about Atomic’s pitch and product demo… which gave them a clear direction and led to them quickly getting their first 10 customers.
We started to hear objections of “This product isn't ready for X, Y, Z reason.” Or “This isn't a good fit for A, B, C reason.” We took notes and came back to them. And they were super open to exploring further. Some eventually bought, others we realized weren’t a good fit to buy now - which was helpful feedback too.
I asked Michael about the advisory approach vs. pure cold outreach and selling. He talked about why it was a good fit for Atomic:
It IS a lot of extra work, but I think there's two reasons it worked for us.
One: Very tactically, you got a better response rate because you're making it more interesting for them.
Two: When you don't really know what you're selling, but you’re still trying to sell, it really stalls out the conversation.
In our case, we were selling before we really had a UI. We’d get on sales calls and try to explain the model and show them a spreadsheet and people were like, “What are you talking about?”
But when it was positioned as, “Hey, join the advisor network and give us feedback,” it was really disarming. It gave us an opportunity to co-create with them and figure out what we're selling, essentially collaborating on product-market fit.
I've used an advisory board in the exploration phase for other ventures too, when I don't know much about the market and I just want to talk to people. Instead of doing expensive GLG calls or just relying on my own network for intros, now I can set up outbound and talk to lots of people and get their help. They go above and beyond, helping me with selling, hopping on the phone like once a week, really awesome stuff.
It’s been awesome to see Atomic’s business unfold on their path to product-market fit. There are a bunch more insights in the interview, but I wanted to keep this post focused on the advisory network as a tool you might consider using.
And yeah, if you find Michael’s approach compelling and want to learn from me and a cohort of a couple dozen other great B2B founders, consider joining my upcoming early-stage founder-led sales bootcamp, which starts July 8.
And while I’m at it, give me feedback – is this post helpful? How can I make conversations like this more valuable for you?
Finally, if you are interested in being interviewed for a future interview newsletter, send me an email: rob@reframeb2b.com.
Really love the advisory network as a tool to get the business off the ground and to design the product and the pitch.