The B2B Software Mistakes List.

Trust but verify… especially when equity is involved.

Never let tech put logic in the database.

There are no ‘deals’ where people are concerned. Don’t hire cheap and expect expertise.

Customers pay for value. Don’t let them bully you on terms.

Hearing price before value means selling a commodity.

Customers stay in the sales process for the demo… wait

Blowing valuable time on bad deals wastes money.

No accountability in sales means no sales.

Don't make the mistake of separate databases for separate clients.

Only sell what you have, stay away from betting on the future.

You better know the problem well to succeed. Better yet, live the problem first.

Java doesn't go with MS SQL... make sure your stack makes sense.

Rolodex sales people never deliver. Don’t do it.

You need experience in building a company. Training is a luxury of big firms. Not small ones.

You pay for output. Don’t measure what’s easy; evaluate what is important.

Self-explanatory... don’t do it.

Nothing works out the way you think it will. Protect your future self.

Keep it simple silly...

If you don't, then you might as well shut down... keep investors well informed and not only positive stuff.

Pricing should ALWAYS be informed by customer value. Pricing in a vacuum is either too much or too little or too confusing...

Don’t play lawyer. Get a good one, keep them focused and make sure your contracts are well designed for their purpose.

Yikes... not good. Get a lawyer, get that fixed asap. If you need to pay someone to get it signed, then do it.

Uncle Sam is always going to get his...

Bad tech process and poor documentation means no scaling potential. You don't want this to hold you back.

It is tempting to break a sprint and fit one more thing in... it kills your process. Never do it. Not for the biggest customer or the biggest problem.

In-house is functionally not possible (or not reasonable) at the early stage. Get a good partner and develop a relationship, even if only for backstop on turnover.

Focus on the cost and quality of the output... its harder to measure but ultimately the right thing to measure.

Vetting technical talent is important and nearly impossible without technical know-how.

Often this is because the team doesn't like the rigor of proper process and wants to move ‘faster.’ This doesn't scale.

Don't outsource core functions. If you productize an off the shelf product, you aren't a software company, you are a reseller.

Scale requires second and third order thinking. Don't be myopic. Think about the future.

Be careful here. You company needs different skills as it scales. If you can't fire someone who isn't a fit anymore then you have a liability that will never go away.

Talent is worth what it is worth. If you need a heavy hitter, then you need to be prepared to pay for it. There are no ‘deals’ in this space. Be careful about paying more than market but be fearful about paying under it.

People are self-interested. Never forget that.

Commission structures are semi-permanent in nature. It is hard to walk one back. Think through self-interest and through your scaling strategy.

Something goes wrong, someone needs to account for it. Don't tolerate ambiguity here.

Minutes prove meetings and give accountability for the white space on an org chart. Don't skip them.

Meetings without an agenda might as well be a brunch. Nothing will get done.

Employees are a huge cost center. In the early days, each one could represent 10-20% cost increase to the firm. You need productivity, and you only get it with intense onboarding.

One bad tiny investor can tank a business. Good investors want to be vetted, bad ones don't. Do your diligence.

Hasty investor legal docs are a time bomb. Don't tolerate special deals or last-minute edits. Keep legal engaged.

Bad expectations can box you into a set of bad choices. Keep investors in the loop but be careful about future expectations.

Adjacent markets are equivalent to a new startup. Keep building the one you’ve already got.

Trade shows can be valuable. Start small though. Be careful about expecting it to be a one-trick pony that will carry your process.

Inexperienced hires need management. The less experience, the more management is needed. Make sure your org chart has good management in place before hiring.

Sales is an input to product management not the controller of it.

Dev executes the product vision, it is not the controller of it.

The roadmap is the canvas that all constituents in the company fight over to get their vision fulfilled. This is vital to building the right thing.

The roadmap is not a customer facing document. It is subject to change and negotiation. Don't box in your team by making one version fixed.

Implementations are vital to customers experiencing the promised value. They need to be meticulously architected.

Never agree to an hourly-not-to-exceed contract. It's a losing outcome regardless.

It is easy to get exhausted in the sales or account management process and accept bad requirements. Never close the door on discovery until Dev is satisfied. It will always result in a bad experience.

Similar to fuzzy requirements; make sure your scope is deliverable, demonstrable, and approved by the decision-maker.

Somethings can be decided quickly, some not. Make sure to identify strategic decisions from tactical and spend time with wise counsel.

Channel partners are enticing. But selling your product is your responsibility. Channels are distribution mechanisms they aren't distribution itself.

Start with value. A product without value isn't anything. And value without distribution isn't known. You need both.

How do you know where you are if you don't have a map? Benchmark your company and keep track. The harder to measure, the more valuable the practice.

Never ‘learn’ something from a question that could have been answered through research. This shows ignorance.

Obvious... but it happens a lot.

Support ticket systems are mandatory.

Don't keep relearning the same issue or reteaching the same solution.

Show respect by going into a meeting as prepared as possible.

Sure, build some support tools, but leverage what you can; especially for support ticket or dev ops.

Lead with value; SLAs aren't value. Don't bring it up unless necessary. Have a ‘standard’ when asked.

Equity is how you get good talent for less cash. Don't be stingy. Be smart and put proper vesting in place.

Your product needs capital. Don't underestimate the cost to build a revenue-commanding product.

Value sells not tech. You need to sell the value.

Changing is painful, it's a cost beyond the price of your product. The value you provide needs to overcome switching costs as well as your price point.

Fundraising is hard... selling to customers is easier. Raise money from customers first. Double your timeline for raising from investors.

High stakes tasks need clear communication and clear communication takes time. Get it right.

A lack of an organized data room results in months long delays for new funding. Keep your systems organized, your deck fresh, and your cash flow managed.

Founders, you are responsible for your cash needs and spends. You can outsource the tactics, but don't outsource the responsibility.

Exponential growth consumes resources exponentially. We often think linearly. This can be a problem. If you are wrong twice the same direction, assess the dynamic for exponential factors.

Exponential growth is hard. Don't bank on it.

It's not done until it's done. Don't let your team socialize unsigned deals as done. At best it’s silly, at worst it hides the true state of the company and can result in devastation when funds run out.

CYA comments (those that are designed to be referenced back to in a later date) are terrible. Create an environment of written specifications and changes only. Be clear on this.

Performance reviews are mandatory. They feel weird early on when everyone knows everyone, but get in the habit of doing this and it keeps accounts short and develops a high-performance culture.

Look for win-win. If you are being forced to do lose/win, walk away, it's not worth it. Alternatively if you see your team pushing for win/lose address that immediately.

Sometimes it pays to be nice and give a concession. Be careful though to document it and ask for something in return. All concessions should be win-win.

Be careful, and wary, of edits to the MSA. You need to keep your contracts clean. A bunch of one-offs (unless you are $500K+ per customer) will bite you in the end.

There are great reasons to outsource like fractional expertise and scaling up tactical execution. Strategic oversight should never be outsourced. As you grow, you need more oversight.

Be good to your investors, but be careful to set boundaries. If things get contentious, focus on your large investors and, if necessary, ignore the angry small ones (the angry ones are always small)

Vocal customers can be a good thing. But when the relationship gets strained, focus on large customers and, if necessary, fire ones that aren't operating as partners.

Own what you can, but put boundaries on frustrated customers and don't own what you aren't responsible for.

Get a rev rec policy and make sure it is GAAP. Keep good records.

Hard-close financial statements and don't reopen for edits. Changing historical financials is a sure-fire way to destroy trust with investors.

Don't bluff... ever. It never works.

Keep all customer contracts in a register with all relevant information.

Keep all customer contracts organized and versioned in the final executed form.

Your contracts should be worth defending. Poor remedies in the contract results in a lack of adherence to the contract by counterparties. If a counterparty fails to conform, you need a monetary reason to pursue it.

Don't engage in brinkmanship. Look for win-win. It never wins to plan to loose.

Failure to control vendor contracts means auto-renewals, escalations etc. that you don't want.

Ignoring a problem results in the problem growing. Don't ignore it. Set time and knock it out.

When faced with brinkmanship, if it is possible to lose, you did something wrong already. Never back down. And don't bluff.

Don't let your customers misunderstand your offer, intention, or value. Address it every time and address it directly.

Always use a CRM and adopt a commission policy that forces compliance.

Switching CRMs can be the right move; most time it is not. Sales teams complaining about CRM is the norm. Don't let them blame poor performance on CRM.

Don't tolerate dishonesty. Address it directly with team members, investors, customers, and vendors. Adopt a zero tolerance immediate consequence policy.

There are a ton of people who will charge you to ‘find money’, don't do it. NOTE: this is different than banking your company for sale or finding a financial partner.

Document your key processes.

Every process needs an owner.

Every process should have a deliverable and evidence of conformance. Demand this.

Some things are worth optimizing for costs, but most aren't. If it's in the ballpark of affordability and you aren't locked in for a long time, then sign and move back to driving revenue.

The only valid activity from S&M is sales activity. Don't let the activity shift to non-core things.

Make sure your team has appropriate recharge time. Make sure you do too.

Once a process is set and ownership is given, then founders need to get out of the way. Stepping back in subverts growth.

Get on top of AR and do it quickly. Bad AR processes is like running a marathon and then deciding not to cross the finish line.

Every core activity in your company needs a person accountable for it. Don't let overlapping responsibilities cause underperformance.

A pitch is exciting, but be careful to stay grounded. A pitch necessarily must show the financial benefits of success. It can easily disorient founders from the task at hand. Stay focused.

Products are dynamic processes of interrelating variables: customer pain, problem frequency, solution believability, solution efficacy, and customer expense. These (and prob more) cant be determined without SMEs working in concert with development.

A product roadmap is an investment plan. Don't tolerate low resolution on the plan. Three swim-lanes and quarterly columns is too loose for such an important investment. Get tight.

Software companies are all about people. Poor performance can become cultural. Dive in on missed goals (budgets, promises, etc.) and find the reasons with your team. Don't let it slip by; even the small stuff.

Every software company, regardless the size, is ‘too thinly staffed.’ This is because every product can go deeper, get bigger, etc. Dev never ends and customers never finish giving requests. Sit in this tension and focus on what you can control.

There are tons of tensions in software companies. Don't let problems keep emerging (similar to #93). When you hear your team talk about a problem more than once, stop and dig in and help them solve it. Unmanaged problems grow like debt and are harder to control.

Investment commitments slip, customer interest wanes, potential exit conversations die... life is full of disappointments. Don't magnify them by passing expectations down the line without managing them.

Software magnifies human potential; it doesn't replace it. Don't expect software to be a silver bullet that can operate without human intervention. Always ask what human intervention is the product magnifying.

Ideas succeed through execution. Stifling execution in the name of protection prevents success.

If someone isn't working out, then make a decisive clear move. Don't expect them to catch a hint and leave. Terminate them with grace, honesty, dignity and truth. Be clear and definitive.

Engineers must QA their own submission. Failure to do so threatens the stability of the product. The QA function should identify root causes on all downstream issues and ensure dev engineer QA occurred.

Some customers need to extract a pound of flesh to feel good about a transaction. Its best to have options in your contract that allow you to give that accommodation while still preserving your business. Set a couple out of market elements in the contract.

Sometimes customers need to go. Customer expectations can mess up a product when they aren't aligned. Holding onto customers at all costs will result in disaster.

Your team is your most strategic resource. Onboarding the team is the most important process in your company. Don’t neglect it. Don’t expect people can gain context, history and awareness of the plan on their own. Invest in onboarding.

Don't put all your eggs in one basket for one customer. Make sure you are talking to multiple potential customers at one time.

Don't let the name of a company or organization convince you to take part in something just because of who they are. Only take part in something if it will add real value to your company. Your time is valuable. Don't waste it.

People need to easily understand what your product is. If you don't have clear messaging, you will struggle to sell.

Fundraising isn't completed until there is cash in the bank. Don't make large business decisions based on investor's commitment without having the cash to pay for it.

Culture Flywheel - the more you invest into your company culture, the more devoted your employees are to the company which helps to have more effective employees which drives revenue.

Part of being a founder is making the tough calls. Don’t make other people do this for you. Delegating when you feel the urge to run is a guarantee for failure.

Pay requires work and work requires effort. Don’t expect customers to expand without sales effort.

Stop wasting time on things that aren’t going to grow your company.

Your product needs to be solving a specific need for a specific group of people. The broader the product, the harder it will be to sell. We’ve never seen a product that was “too” small.

It takes time to figure out the correct messaging and channels to reach your customers. Don’t be so quick to pivot to a different customer base. Fitting your product to a need is hard. Ignoring other needs that are responding to you at the same time is harder.

Be careful to not just hear what you WANT to hear, but actually hear what the customer is communicating. People don’t like letting others down. They will be indirect with their “no”. Always assume the “no” as a base hypothesis and let the opportunity earn your time.

You need to own every part of the customer journey. If things go awry, understand why and do what you can (within reason) to make the customer experience as seamless as possible. A small product makes this easier!

Your cash model needs to be continually updated (~every quarter) to match what your current reality is to have a realistic view of the cash forecast. It doesn’t matter who you delegate it to, the founder is always responsible for the accuracy and reality of the cash model.

When something frightens you, lean in. Avoidance and ignorance will result in the outcome you most fear.

Revenue should always be top of mind, not matter the stage of the company. It’s your number one.

Your pricing should be inline how long your sales cycle is. The less you charge you customer, the shorter the sales cycle should be (and vice versa). Use 2 weeks for 20K ACV as a guide.

Hiring takes more time than you think. Utilize the resources that Golden Section provides. (If you are using Guide Services, you get 4 free hires every year!)

Being a founder is tough and you will face many challenges. Utilize your partners. They are there to help.

You need to always have a handle on your cash position (i.e., burn and runway). Cash is king! Hopeful thinking isn’t an antidote to chaos. Get caught without cash and you’d be better off running naked through Times Square.

If you ask someone for what they’re pissed about, you’ll get an answer… if a trash collection company asks people if they smell something, they will smell it whether they actually can or not. Don’t put discontentment in your customers’ mind.

If you wait until your product is perfect to sell, you will never sell anything. Perfectionism will be the death of your company.

Hiring doesn’t directly correlate to creating value. Make sure you aren’t depending too much on others to drive revenue for your company.

Don’t be fearful of hiring someone who is better than you at something. You should hire people to fill in your weak spots.

Delaying difficult decisions only makes problems worse. Proactive decision-making prevents crises and builds long-term stability.

Stick to the vision investors backed. Pivoting too soon erodes trust, confuses customers, and risks losing momentum. Secure alignment before making strategic shifts.

Markets change, and rigid businesses get left behind. If you can’t pivot when needed, you’ll be watching from the sidelines. Bend so you don't break.

A sleek brand won’t save a sinking ship. Flashy marketing and reputation matter, but if your finances crumble, so does your business. Keep the lights on first, then worry about the font choice

Founders forget how long it took them to learn the product and market. New hires need time, training, and clear process to catch up. Don’t just hand off sales and hope, simplify the process, bake in support, and budget for the real cost of getting them fully productive.

You don’t operate in a vacuum. Competitors emerge, power shifts, and new players change the game. If you aren’t watching the full ecosystem, someone else will, and they’ll use it against you.

Progress requires concentrated force. Spreading your energy across 25 half-baked strategies won’t get you anywhere. Pick one, apply real weight, and see if it moves. You can’t cheat physics.

If every product update comes with a new engineering lead, you don’t have a team, you have a temp agency. Talent turnover kills product memory and momentum.

If your customers only interact with your team and not your product, you’re running a services business, not a software company.

If you're always “in talks” but never “signing deals,” you’ve built a vibe, not a sales funnel. A full calendar doesn’t pay the bills.

Users don’t experience your product’s codebase, they experience how it feels. Function may be strong, but without form it lands flat. Don’t let utility outshine usability, even great tech dies if no one enjoys using it.

Pushing for volume when the engine is cracked just makes the breakdown faster. Growth only works if the foundation is sound. Pause, check your unit economics and ICP, and then pour gas on it. Don’t sprint the wrong direction.

Founders kill strategies before they’ve run long enough to know if they work. Outbound email isn’t broken because you sent 200 messages. Advanced teams send 10,000 a week without blinking. Don’t confuse “we haven’t given it enough reps” with “this doesn’t work.”

Debt is a tool, not a failure. Founders who don’t understand how debt works often avoid it entirely, even when it could extend runway, preserve equity, or reduce risk. Ignorance here quietly limits strategic options.

Founders often trust only the deals they originate. Ignoring qualified inbound or partner-sourced opportunities can stall growth and delay access to capital, customers, or strategic leverage.