Abnormally long sales cycles, rigid procurement policies and high-charged political climates dissuade some technology companies from fully engaging with the U.S. public sector. All too often, early-stage companies gravitate to more predictable and low-hassle private markets for initial revenue growth. What they end up leaving on the table in so doing, though, is their cut of a relatively stable market that spends over $200 billion annually on technology.
While there is no perfect formula to generate and sustain growth within the GovTech and EdTech markets, here are two (more) things technology companies can do to move the needle faster.
Cooperative Purchasing Agreements
In addition to the General Services Administration's contract vehicle mentioned in our last post, there are a few other options to consider when looking to distribute your company's products to this market. U.S. Communities and National Association of State Procurement Officials (NASPO) ValuePoint offer State, Local Government and Education buyers competitively-bid purchasing agreements that can dramatically shorten the procurement process for participating entities. Further, there are a number of U.S. consortiums, such as Midwestern Higher Education Compact (MHEC) or Western Interstate Commission for Higher Education (WICHE) that offer similar value at regional levels.
While this may appear all too obvious, it is crucial to remind technology companies that public sector buyers rarely respond well to commercial or generic messaging. These prospects are barraged daily by companies also trying to get their cut of the $200 billion annual market. It is critical that you differentiate yourself enough to break through the constant noise your competitors are drumming up.
To do this, ensure that you can clearly communicate how your solutions address the public agency's mission and, if possible, the unique directive of the specific department you're targeting. Since these are public entities, you can access this type of information fairly easily. Here is an example of the Bureau of Reclamation's mission, for instance. How would your solutions address this agency's mission? As you carefully consider the buyer's responsibilities through the lens of their agency's mission, you can formulate a tailored value proposition that will increase your chances of winning revenue.