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My Customers Showed Me the Door. Here's How I Won Them Back. Five tips for translating tectonic market shifts into startup opportunity by delivering what customers want.

By Lior Gal Edited by Dan Bova

Opinions expressed by Entrepreneur contributors are their own.

Assembly | Getty Images

Every sales rep is used to rejection, but when it comes in droves, it's called market feedback. You either listen -- or get swept away. Until 2014 I'd handled enterprise sales for 15 years, working for major enterprise OEM storage companies. I knew how to deliver, and my family had grown used to a certain level of lifestyle. Life was good.

But during 2013 and 2014 the market started a shift from expensive OEM solutions. My biggest customers made it clear that this would be the last hardware box they were going to buy. They wanted off the shelf, commodity hardware -- like the Tech Giants were doing. They planned to spend as little as possible on custom hardware and simplify their operation. By using homogeneous hardware, they could find ways to improve their software stack.

When markets shift.

The more I started exploring what my customers wanted, the more I knew they were right. There are times when markets face tectonic shifts, and this was the beginning of one. I'd never built a company and I knew I didn't have all the answers. But even the best product won't succeed if it's sold at the wrong time in the market.

Related: What's the Secret to Startup Success? Timing.

Fast forward four years. Our company Excelero launched after nearly three years in stealth mode. Our story is still being written, and the road is filled with challenge and choices. But within a year since we shipped our product we won some of the biggest enterprise customers in the world -- that kind I used to sell to. We also convinced the leading commodity hardware players to partner with us and push our vision and product to the market.

Here's five steps on building a company by reading tectonic market shifts so that you can walk right back to those customers who said goodbye and win them.

Make co-founders your blood brothers.

A successful product starts at the top with a shared vision and passion. Go beyond what everyone else does in selecting other co-founders with complementary skill sets. I moved from the US to Israel for the first two years after founding my company, so I could work closely with my co-founders. After countless late nights, Red Bulls and hummus, they have my back and I have theirs. Now that I'm located in the US again, we have the foundation to trust each other implicitly and make decisions efficiently from a common framework of what we want to take to market.

Choose investors who balance each other and you.

Investors are married to you with hundreds of legal documents, and they're involved in myriad decisions on ventures, budgets and strategy. They'll become board members, and before you know it they'll have majority vote. Choose well.

While it's tempting to target only the very largest VC firms with the largest name recognition factor, it's more important that your first VC will have previous success in your market. Knowing nuances that will compel a risk-averse buyer to take a chance on a startup is far more important than building a perfect first product or getting everything right with the go-to-market plan.

Related: The 3 Big Things VCs Look For When Funding Startups

You still might make tactical mistakes, but the right investor will keep you safe from making strategic mistakes that you might never fix. We almost decided to build our own specialized chip, but an investor helped guide us to partnering with hardware players who were already doing this, and driving our uniqueness with software.

Even better if the VC has invested in your specific market niche. For example, when a former founder of a wildly successful venture was invited to perform technical due diligence on behalf of a VC in our second round, the former founder was so impressed with us that he became one of our angel investors. Being able to share this narrative -- that his insights on our IP made him an investor -- spoke volumes on a deep technical level.

Also balance the types of investors in the round -- those with deep pockets, such as the traditional VCs who can streamline access to dry powder, as well as strategic VCs who can build their much larger, established lines of business around your offering.

Most importantly remember it's ultimately your choice on whose money to take. As one of my co-founders says, divorcing your money is far harder than divorcing a spouse.

Build a product with genuine differentiators.

Me-too's with a twist, or a slightly different riff on a proven category, usually fade away. Pick a transformative trend or two to ride, ones that are two to five years out, and do all you can to vet that your target audience also agrees they are worth embracing. Listen to every job interviewee on what they're building and why they think it's cool.

Related: Check Out These Cool Artifacts from Big Tech's Recent Past

Vet what you hear from every prospect that rejects you, for signs of something that might impact your later success. Watch failed startups in your sector for signs of what to avoid yourself. Watch pricing trends so when the inevitable commodification or price-parity between old and new offerings occurs, you've accounted for them.

Slow is better than fast.

Customers want to know you're in it to last. Hire slow, but well. Spend slow, to avoid the fate of those who think a high burn rate is a sign of momentum then suddenly hit the wall. We took far longer in stealth than most because we secured and delivered results for a half-dozen major name paying customers first -- something that showed we were for real and helped land the next dozen paying customers.

Disqualify rigorously.

To be what the right, top customers want, you can't be everything. Resources are always limited. Certain customers and partners and their demands just aren't the right fit at a given time. The same goes for perfectly reasonable marketing activities for which you don't have the critical mass of resources yet. It's OK to say no for today. Timing truly is everything.

Lior Gal

CEO and Co-Founder

Lior Gal is CEO and co-founder of Excelero, a software-defined block storage company in San Jose whose solutions help meet performance and scalability requirements of the largest web-scale and enterprise customers.

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