Inside Mercator AI’s First Deal: How a $200 Contract Required 21 Pages of Legal Documents
Enterprise sales are complex, but Mercator AI’s first deal took complexity to new heights. In a recent Category Visionaries episode, CEO Chloe Smith reveals how a seemingly simple pilot turned into a months-long negotiation.
The Initial Breakthrough
The deal started with a simple proof of concept. “We had put together this kind of proof of concept package that really just outputted a spreadsheet, frankly,” Chloe recalls. The response was promising: “Oh my goodness, you got me in front of like new clients I would have never known about.”
The Structural Mistake
Instead of moving straight to a contract, they made a crucial error: “We signed it as like a letter of intent that they would pay. So, like, talk about setting yourself for two sales cycles.” This decision doubled their workload and extended the sales timeline.
The Sprint to Product
With the LOI signed, pressure mounted: “Off that letter of intent, we pulled together a team of, I think it was three or four developers at the span of six weeks. We built the MVP and launched it over Christmas.”
The Legal Marathon
Despite the small dollar amount, the legal process proved intensive. “We had to get buy-in from all their other team members. And it took months. It took so many months,” Chloe shares. The culmination? “We’re literally redlining legal on this 21-page document to sign a $200 contract.”
The Milestone Moment
This first deal carried extra weight as a personal milestone. “This was one of the milestones that I had set, actually, with my husband about, like, when I was going to call it quits to trying out this idea, this pursuit,” Chloe reveals. “I had to have assigned client by the end of 2021.”
The Anticlimactic Victory
The actual signing proved less dramatic than expected: “I remember having it all signed and squared away and thinking, wow, how anticlimactic. Like, I thought this was going to be one of those moments where you cheer and roar. It was going to be amazing. No, it was really anticlimactic.”
The Lasting Impact
This first customer remains with Mercator AI today, validating their approach despite the complex process. More importantly, it taught them crucial lessons about enterprise sales in construction:
- Legal complexity exists regardless of deal size
- Stakeholder buy-in takes time
- Letters of intent can complicate the process
- Customer validation should drive product development
For B2B founders, Mercator AI’s experience offers a sobering reminder: in enterprise sales, the dollar amount often bears little relation to the complexity of closing the deal.
Twitter
facebook
linkedin