Regardless of whether a tech startup receives millions in seed funding or is bootstrapped, the same conundrum arises when it comes time to select a PR agency to go after TechCrunch, VentureBeat and Mashable.
If you hire the big-name PR agency from San Francisco or NYC, what should you expect to pay for all the bells and whistles? Or, what will you pay if you hire a small local firm or an indie consultant? The options are nearly limitless, in part because what a PR agency can do to help promote a tech startup to the media (and world of social media) is constantly evolving.
To help make sense of the many options, here are some quick-and-dirty estimates you would normally expect to pay for PR:
Bootstrappers: $1,500 – 3,000 / month
- If you are a tech startup in the classic bootstrapped, lean startup model, then you probably don’t have much cash on-hand for marketing and PR. That said, you still need to get the word out in order to inform the world about your new technology breakthrough. Honestly, PR is better suited than most other marketing activities at creating interest in your startup so you should be prepared to invest more up front to spark as much interest as possible.
- Project duration: 3-6 months to get you rapid exposure and customer awareness for a possible future Angel round.
- Media placement potential: local business news media, as well as national trades, with a long-shot attempt at TechCrunch.
Angel-backed startups: $3,000 – 7,500 / month
- If you scored a round of seed funding in the low 7-figure range, then you obviously have more budget to pursue an aggressive PR campaign. You can (and should) combine your PR campaign with other marketing activities such as paid social media campaigns, SEO, and regular email marketing.
- Project duration: 6 – 12 months to gain strategic market advantage and compete against other startups for a larger VC-backed investment.
- Media placement potential: local business news media; tech blogs like TechCrunch or VentureBeat; national trades; possibly a pick-up or two in general business news outlet like Inc. or CNNMoney depending upon your target market.
VC-backed startups: $7,500 – 25,000 / month
- Getting a VC round is tantamount to winning the funding lottery. Just because you snagged $5 – 25 million in funding, however, doesn’t mean you should overpay for PR. That said, don’t make the mistake and under invest either. You should be prepared to run a sophisticated, multi-layered marketing and PR plan. You will need your PR firm to be professional enough to be the first line of defense for any media inquiries. Your PR plan will probably need to target multiple demographics and therefore require different messaging and lots of interview logistics, so part of what you pay your PR firm will be in the form of capable project management.
- Project duration: 12 months minimum to gain dominant market position, possibly as the first-to-market.
- Media placement potential: local business news media; tech blogs like TechCrunch, Mashable and VentureBeat; national trades; likely pick-ups in general business news outlet like Wall Street Journal, NPR, CNNMoney and more.
Some PR firms even go so far as to work on a blended retainer / pay-for-performance PR basis, which can work well for bootstrapped tech startups or ones with seed funding of around $1-2 million. Be sure you understand the bonus structure for the pay-for-performance piece of compensation because you don’t want to find yourself owing more than you can afford.
Do you have any thoughts on how much to pay for PR? Have you overpaid and gotten lousy results? Did you score some great media coverage on a dime?
Let us know!
About Dave Manzer: Dave Manzer founded an Austin tech PR agency for startups and emerging-growth businesses in 2009. Dave Manzer is one of the only agencies in the country specializing in technology, healthcare and energy PR to provide blended performance-based pricing. To contact Dave directly, please email him at dave(@)davemanzer.com.