These Steve Blank stories always get to the heart of the matter. What was particularly interesting about this one was that early sales were to friends and close contacts, totally skipping the "customer discovery" step.

My favorite line is Note that most VP of Sales’ have world-class antenna for career danger.

That was the part that really stuck with me too. The previous startup I worked for sold energy-use reduction software and had initial success selling to local governments who wanted to look "green" and help a local startup (outside the valley). Once that limited market was sold to they started having trouble selling to the wider commercial market and didn't make sales targets. Government wasn't really buying to make a successful return on investment so perhaps the CD was also "hollow" as with friends and family.

Gosh. Lets just hope that we don't suffer the same fate. Of course it helps that almost none of our friends or family are industrial scale power users.

In a small startup the analog to this is turning on a wide-scale Google adwords campaign with no site optimization, no keyword optimization, and no idea about what your customers/potential customers want, and watching Google charge you $2000 in a week.

If you don't know your customers needs, you have no way of doing efficient "site optimization / keyword optimization".

The lesson everyone should take home is this ... for any buck you spend on marketing / sales / R&D, you need to have feedback (OK, so you've spent $2000 on Google Ads ... but what's the ROI on that?). Can you measure that return? If not, it's money going down the drain (startup or not).

Kind of sad how they get in a consultant and then won't listen to what he had to say.

Apart from that: How could you protect yourself from not being mislead from the first sales through people personally known to the founders? They might tell their friends etc., when could you assume that they buy it not through a certain personal link?

In this case the board was complicit - they provided sales leads as well.

Interestingly (and probably somewhat obviously), this lines up very well with Moore's Crossing the Chasm. The company in the example assumed that their innovators (the friends/family and references of board members) would be representative of their early adopters, and possibly even the early majority. It seems to me that they fell into the crack between innovators and early adopters, without even reaching the chasm.

By itself, why is it bad for sales people in the same company to use different slide decks or approaches?

It's not. But like Steve Blank said:

The standard corporate presentation wasn’t working, so the Boston sales rep made up his own. (I asked for the Boston sales rep because in the U.S. they’re furthest from the Silicon Valley corporate office and any oversight.)

We call the five other sales people and find that they are also “winging it.”

In other words, there was no repeatable sales model; knowledge about what the customers want and how to sell to them was not converging.

It seems unlikely that there was even a solid value proposition.