Databricks co-founder shares how startups can win large enterprise customers

Arsalan Tavakoli-Shiraji, co-founder and senior vice president of field engineering at Databricks, explained last week at the TechCrunch Disrupt startup conference how young companies can win large enterprises as customers. Databricks helps businesses store and analyze huge amounts of data. It is now valued at $190 billion, and more than 70% of the Fortune 500 are among its customers. It was once a tiny startup, though, and Tavakoli-Shiraji was responsible for helping land its first big deals.

According to him, young companies often wrongly assume the best technology decides deals. He said he learned the hard way that people and processes matter most. In one early meeting, the prospect turned out to be the person who had signed a major deal with a Databricks competitor, so he had no interest in listening. Other early deals fell through because the startup was not ready for legal, contractual or security questions.

Working under a bigger company's umbrella

Databricks initially failed to get a meeting with UBS, the Swiss bank. That changed when it became a Microsoft Azure cloud partner. Sales agreements were covered under Microsoft's terms, and Microsoft's salespeople booked meetings and advocated for the startup. Tavakoli-Shiraji called it a huge boon. Today Databricks works with startups such as Hightouch, Addepar and Tecton, selling their products under its own terms and cybersecurity setup.

The four C's of selling AI

He groups enterprise objections into four categories: context (AI that can be trained like a new employee), choice (the freedom to switch AI models), cost (controlling running costs) and control (safeguards and protection of sensitive information).

Legacy systems as an opportunity

By Tavakoli-Shiraji's account, 99% of the executives he talks to sit in the first or second level of his five-point scale of AI adoption. He sees an opening for startups to modernize expensive legacy systems, such as the IBM AS/400 and mainframes used in banks, since AI agents can now understand what that code does.