Multi-product cross-selling reduces customer acquisition cost close to zero
Sumit Gajri · 20VC: Portfolio Construction, Optimising SPVs, Opportunity Investing "Between Rounds", Being Distribution-Centric Over Product-Centric and Capital Concentration Within Funds With Sumeet Gajri, Chief Strategy Officer @ Carta · Jan 17, 2020 · at 29:00
Sumit Gajri, Chief Strategy Officer at Carta, explains why companies relying on third-party advertising have high burn rates compared to multi-product companies leveraging existing distribution channels.
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“And I think that's a reason a lot of these companies that you see today have uncontrollable burn rates, because the only way that they are growing is spending money on customer acquisition channels that they don't actually have a lot of control over. And as a result, their growth is very expensive versus companies that are able to build one product and then go for their own distribution channels to sell the second product or the third product. Their customer acquisition cost is close to zero because they already have a relationship with the customer.”
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