20th February 2024

My muscle memory for identifying spam has become so well-honed that I barely spend a single second scanning the 5-10 errant emails that evade my junk filter each day before consigning them to the bin.  While these cold sales pitches are undeniably irritating, some can even provoke a tinge of anger (for example when they’re persistent or have a rude tone).  Surely, I am not the only one who thinks this about these irksome inbox intrusions? It begs the question: why do cold sales emails persist?

Part of this phenomenon may stem from my British sensibilities, where the mere notion of being sold to can induce a sense of nausea, and I suspect this cultural aversion might contribute, in part, to the lacklustre productivity statistics plaguing the UK. In contrast, the American ethos seems more pragmatic on both sides of the selling and buying processes, with the very fabric of the American dream woven with the threads of salesmanship. Yet I am not saying cold outreach doesn’t have a place. I have seen it work for high volume transactional sales, albeit with a notably low return on investment, generally only serving to keep revenue growing steadily until the magic of marketing has kicked in and you start generating inbound leads. However, B2B enterprise sales often involve winning over multiple senior execs for six or seven figure license fees. These execs each have back-to-back days full of meetings and hundreds of important emails to process. For them, cold outreach will not only prove ineffective but can actually tarnish the value of a brand.

Consider this, bombarding every potential prospect in your target market with generic emails risks not only irritation but outright antipathy towards your brand. The best you can hope from a cold email campaign is that your emails are deleted so quickly that prospects don’t register what company they are from. However, this is unlikely as your newly hired sales development representatives (SDRs) are likely trained to inundate prospects with follow-ups, making sure your brand is firmly engrained with each subsequent deletion, block or mark as spam. Gmail classifies a 0.1% spam report rate as high. Bearing in mind, the average scale-up spends between 3-8% of their Series A funds sending between 100,000-to 250,000 cold emails, do you really want your business to be tainted with this? 

It is evident that cold emails run counter to sound business principles. Every successful founder understands this instinctively, hustling their way to product-market-fit through relying on trusted networks, referrals from delighted clients, and warm introductions to forge meaningful connections with senior decision makers. However, for some bizarre reason, as soon as companies hit £1m ARR and raise their Series A funding, there is a dangerous tendency to abandon these proven strategies in favour of a one-size-fits-all sales approach that dismisses the human element of sales, and builds this low EQ, cookie cutter sales engine. The subsequent reliance on entry level school leavers to handle the entire process of prospecting and taking the first meeting only exacerbates the issue, yet the vast majority of founders go through this process for at least 6 months, sadly sometimes 12 before they start to panic about sales pipeline not converting. To put it into perspective, the average Series A round (c.£10m in the UK) gives founders about 12 to 18 months of cash runway. On average £0.5-£1.2m of this is spent on SDRs doing cold outreach, booking meetings. As sales cycles for enterprise are 6-12 months, it doesn’t take a maths prodigy to figure out the peril of this strategy … if those leads don’t convert then the remaining £8.8m is vapourised. 

The true danger lies in the illusion of progress. Meetings may indeed be scheduled, but rarely from someone with the authority or inclination to make purchasing decisions.  It will be from someone ‘interested’ in your AI/SaaS/tech product, most likely junior, or someone with the title ‘innovation’ who is paid to understand products but with no budget to ever buy it.  This results in a mirage of sales activity, sucking senior resources into phantom sales processes that artificially inflate metrics for at least 6 months while diverting resources away from genuine opportunities. It’s a recipe for disaster, one that ultimately jeopardises the long-term viability of the business.

I urge founders to revisit the entrepreneurial spirit that propelled them to success initially, embracing hustle, creativity and disruptive thinking in their scaling efforts. There is something extremely powerful about the pivoting and learning process of getting to product-market-fit and therefore founders should ensure that trustworthy introductions and personalised outreach remain the cornerstone of their go-to-market strategy.

I would argue this remains the case no matter how far you grow. Having worked for some of the biggest B2B firms in the world, even in a behemoth industry, the best leads still come from the senior partners, the c-suite, and trusted relationships. The second best are from marketing, and close to zero are from cold outreach. If all companies ditched the spivvy sales strategy and focused on quality, perhaps the UK’s ability to commercialise B2B tech would improve somewhat. 

At Form1, we work with large pool of senior introducers, each with trusted networks in our scale-up client’s ICP (Ideal Client Profile). We help our clients industrialise the exact process that got them to product market fit by operating as an extension of the sales team, working closely with the CEO and CRO to ensure their pipeline is filled with high value leads.

If you want to scale your business in a sustainable way, get in touch to find out more.