No One Ever Got Rich Off of Selling to Rabbits
In sales, there are four types of contracts you go hunting for: Rabbits, Deer, Elephants, and Whales.
Most people assume the only difference between them is the price tag. They think that because a Rabbit is smaller, it must be an “easier” kill. I spent the last six months experimenting with SMB ideas—hunting rabbits—thinking I could invent new ways to lower CAC, build relationships faster, and bootstrap my way to a win.
I was wrong. Here is what I learned about why “selling small” is often the hardest way to grow.
The Trust Tax
Whether you are closing a whale or a rabbit, the deal is signed on the basis of relationships and trust.
While it is objectively harder to build that trust with a Whale, the “Relationship Overhead” required to sell to a Rabbit is surprisingly similar to an Elephant. A Rabbit-sized contract (a few hundred to $1,000 a month) represents a significant portion of that small business owner’s world. They care about their business just as much as a CEO of a Fortune 500 cares about theirs.
You end up doing “Elephant-level” emotional labor for “Rabbit-level” revenue.
The Foundation for Growth
The best markets aren’t the ones where you stay small; they are the ones where you can:
Start by selling to the Deer.
Move up to the Elephants.
Eventually, hunt the Whales.
This path gives you a foundation for growth to build on while maintaining velocity in the market. If you stay in the Rabbit woods, you get stuck. SMB markets often have legacy players with incredibly sticky software. Dislodging an incumbent from a small contract is often more trouble than it’s worth.
The Case for PLG (Product-Led Growth)
There is an old “startup-ism” that selling to SMBs is a bad idea. I think I’ve finally realized why: The sales model doesn’t scale, but the product model can.
Product-led building is likely the only effective way to win this category. Why?
It allows you to establish yourself as a “market leader” without the customer seeing how small your team actually is.
It lets you insert yourself into the market and build a better product quietly.
It wins the market before you ever have to “sell” a contract.
The Bootstrapper’s Paradox
The irony is that while SMB ideas seem like the perfect “bootstrap” business, they are often the worst. Because the relationship overhead is so high and the initial revenue is so low, getting those first few dollars through the door is agonizingly difficult.
If you want to get rich, stop chasing rabbits. Start looking for the deer, and keep your eyes on the whales.