What's the biggest difference between starting a SaaS company in the 2010s v the 2020s?
There's lots of new tech and tools, of course, but the most fundamental shift has been in the way modern SaaS companies sell. This is possible because of the rails of other great technology that has been laid. The foundational layers of data to understand a customer’s ideal journey, how to drive product adoption and product expansion are coupled with the payment infrastructure to manage a relationship with less friction that have made evolving your sales motion more lucrative than ever.
It is no longer you are a self serve company or an enterprise sales led company, in the new world, you are all types of sales motions and ideally they are intertwined and are building on top of each other. Where the foundation is strong, your sales can scale.
The following tries to break down each motion and the lower and upper bound of each motion. You will notice that some motions begin even though the prior motion still has a higher bound, that is on purpose, all companies will treat their bounds and when they introduce a new motion differently.
Founder Led Sales ($0 - $5M)
As the founder, you are in charge of the product, the sales and you take the trash out at the end of the night. You can be successful in this motion but growth will ultimately slow if you don’t scale your go-to-market efforts. You want to onboard every customer, get their feedback and really figure out as quickly as you can if they are going to renew.
Product Led Sales ($1M - $40M)
You have found Product/Market Fit. You have built in tech touches with your customers and you can scale your selling efforts via automation. You are starting to make money while you sleep.
Enterprise Sales ($5M - $1B+)
You are getting more nuanced requests, you have more competition and the market is growing very rapidly. The product can’t always sell itself and you need to accelerate deal cycles and break into new markets. Time to scale your sales team.
Customer Success Sales ($100M - $1B+)
You are building more product because you have identified gaps in the market and/or your customers are asking you to do more. You are focused on metrics like Net Dollar Retention (NDR) and you can see growth coming from not just new logos but also from existing customers. Your product is also flexible and growing and you have many customers that are not buying the full offering you have. It is time to add a sales motion to your post-sales process.
Every company starts the same. Not every company ends up in the same place. The question to ask is where do you sit in the revenue cycle of your product and are you complimenting it with the correct sales motion.
Subscribe to Variance News
An inside look at building a company delivered in (roughly) bi-monthly installments
Your First Ten Minutes
You've just signed up for Variance. Welcome! When you first sign in Variance will have that new app smell, take it in...’Explore our Docs