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B2B2C > B2C? Will Sealy of Summer thinks so...
An interview with WIll Sealy, CEO of Summer, on how they figured out which go-to-market strategy was right for them.
Aryaman Banerjee & Rahul Berry
November 05, 2024
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TLDR 🥱
Summer, a fintech helping borrowers manage student loan debt, initially struggled with their go-to-market strategy, despite having strong product-market fit.
Will Sealy (CEO) and his team pivoted from a direct-to-consumer approach to a few other distribution strategies. Read on to find out which channel worked best, why that might be the case for other businesses and how to maximise your chances of GTM success.
The Story
Finding Their North Star
When Will Sealy founded Summer six years ago, he identified a massive opportunity in America's student debt crisis.
The numbers were staggering: $1.75 trillion in outstanding debt across 45 million borrowers. Today, this is the second-largest category of consumer debt in the U.S., behind only mortgages in the US (Yahoo Finance).
50% of student debt could be eradicated if everyone enrolled in the right repayment assistance program
Summer aims to tackle the student crisis by providing a “TurboTax-like” platform that helps customers identify and enroll in loan forgiveness and repayment assistance programs.
Their software analyzes a borrower's specific situation (e.g., loan types, income, location, profession) and automatically matches them with eligible government assistance programs that could reduce or eliminate their debt (e.g., an average of $40k in savings for end users)
Summer’s product
The Distribution Dilemma
While Summer found product-market fit early-on, distribution was a massive challenge for Will and his team.
Whenever we put the solution in front of users, they always said “Wow, I wish this thing had existed for me 10 years ago’”, yet growth wasn’t quite there yet.
Distribution was a challenge for Summer for 2 core reasons:
Market Education: no one had ever really digitised this solution before and customers needed to be educated
Lack of Trust: the high number of scams in the space makes it difficult to build trust with the end consumer.
Approach 1: Their initial direct-to-consumer approach faced headwinds: "It’s reasonable to ask, 'well, why aren't you just selling this directly to the borrower?’ But these customers are expensive to acquire as they already in debt and aren’t willing to spend more to manage it"
Approach 2: While, Summer tried to pivot to sell to universities, this also didn’t work: “There was a disconnect where there was an agency problem and a committee problem where the financial aid staff was like, 'well this is really for alumni because we're focused on incoming students and you really need this for outgoing students.' So you should talk to alumni. When we talked to the Alumni Association, they'd say, ‘you need to talk to financial aid.’”
Cracking the Code: Why Employers Are the Perfect Channel for Summer
Summer's breakthrough came when they identified employers as the ideal distribution partner as:
1. 70% of recent college grads have student debt | 2. Summer delivers up to 20% higher employee retention, resulting in a 7x ROI for employer clients | 3. HR leaders don’t have time to manage an increasing number of employee benefit programs |
To maximize this opportunity, Summer deployed two key levers:
1. Strategic Partnerships Will built a multi-layered approach:
Benefits brokers as trusted HR advisors
Technology platforms like ADP (reaching 1M+ employers)
Channel partners like Credit Karma (achieving $1B in loan savings)
Network of 50+ industry ambassadors
If you’re a B2B business that wants to reach scale velocity, your distribution partners are everything.
2. Targeted Thought Leadership:
Where you get featured matters. We’ve been featured in the New York Times, but that didn’t do anything from a sales POV. Being in retirement or HR benefits specific publications led to a flurry of inbound instead
The strategy worked: Summer achieved 10x higher adoption than average voluntary benefits and built partnerships with major employers across sectors
What's Next for Summer
Looking ahead, they're targeting ambitious growth:
9x revenue over 2 years: this growth trajectory puts them in the top quartile of B2B2C companies tracked by SaaS Capital, which shows median growth rates of 43% for companies at similar stages.
Product expansion e.g., expanding their 401K student loan matching program with ADP, rolling out support for new government assistance programs, and more!
Fundraising: Closing their Series B in 2025
Will's final word of advice for new founders: don’t forget about distribution
Solving distribution is just as important as solving product-market-fit. The “built it, they will come” strategy only works until so long.
Interested in working with us or learning more about Summer? Reach out at [email protected] (or reply to directly to this email)
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💻️ Links of the week:
Regulatory challenges have impeded Amazon and Meta's plans to power their data centers with nuclear energy. (TechCrunch)
European investors are ramping up efforts to scout and fund university-based startups, targeting innovative talent and ideas before they hit the broader market. This strategy reflects a growing belief that universities house the next wave of unicorns, especially in deep tech and science-based fields. (Sifted)
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See you next week!
Rahul & Aryaman
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