2. Niche doesn’t mean small
• Focus => Specific target customers with specific problem and solution
• Hypergrowth comes from focusing on where you have best changes
of winning customers
3. Examples
• Salesforce – started with sales force automation
• Zenefits – focused on California tech companies with 100-300
customers
• FB – started with Ivy league schools
• Paypal – focused only on ebay users
• Amazon – started with books
• Zappos – focused only on shoes
4. Clues you are not ready to grow
• Grown mostly through word-of-mouth, referrals
• Inbound/Outbound lead gen is abysmal
• Dependent on relationships
• Good at too many things
• Even on getting quality appoints too few people buy
5. Clues you have nailed a niche
• When you are able to signup –
Unaffiliated. Paying. Customers.
6. 1st Goal
• Get to 10 unaffiliated customers
o means you have built something valuable
o10 customers will give you a roadmap
7. Focus
• Solve a specific pain for
• An ideal customer in
• A believable , repeatable way with
• Predictable ways to
oFind them
oInterest them
9. Basic sign
• Everyone says your product is cool but no one buys it
• Business buy what they need not what they want
Want Need
Marketers Beautiful website Conversions
Management Happy employees Product releases, Profits
VP Sales Sales productivity Analytics, Reporting tools
10. Questions
• What problem is painful enough that customer will pay
• If solving a need , define it differently
• What differentiates customers who need you Vs who don’t
• Where can you create most financial value
• Where can you get permission to make case studies
11. How to nail a niche?
• Be a big fish in small pond
• 5 aspects of niche
• Popular pain
• Tangible results – easy to show impact
• Believable solution – easy to prove impact
• Identifiable targets
• Unique genius
12. Iteration - Process
• Define a target companies list
• Decide who to reach out
• Min required preparation
• Stop procrastinating and start campaigning
• Make a stop doing list – failed projects, failed customers
14. Predictable pipeline is important
• When lead generation is bad everything else need to be perfect –
product, salespeople , sales process
• But with good lead generation you can afford to be bad at few things
15. Types of leads
• Seeds – happy customers who refer
• Nets – Content and inbound marketing
• Spears – Outbound and prospecting
17. Seeds
• Pros – profitable
• Cons – you have less control over growth
18. Customer success management
• Customer success is a mindset
• Goals of CS
oLower churn
oIncrease revenue
oBetter targeting/marketing
19. Customer success rules
• CS is core growth driver
• 5X more important than sales
• CS – one of 10 employees
• Visit customers in person (5 customers/month)
• Needs metrics to assess – rentention rate, upsell rate
• Evolve the metrics with time
20. Role of customer success
• Traction (0-1m) – What customers want? What do they do?
• Adoption(1-5m)– Why , How should customer user product daily?
• Retention(5-20m) – Why do customers keep using product?
• Expansion (20-100m) - Why should customers expand
• Optimization (100m+) – Automation and improvements
21. Gild case study
• 90 days adoption
• Quarterly business review
• Use predictive tools – Gainsight + Zendesk for tickets
Team structure
1 inside CS rep – monitor usage + run analytics (1 per 70 users)
1 outside CS rep – renewals (1 per 30 customers)
Executive CS - Upselling
23. Inbound marketing
• Quantity over quality
• 50% seeds may turn into customers
• 1% in case of nets
• Pros – High volume of leads
• Cons – High costs
25. Need Demand generation, not Corporate marketing
• Spend X dollars = > get Y leads
• Constant iteration – 5 email templates , 100 mails a day
• Marketing owns it all , then work backwards
• Iterate and move fast
26. Content marketing
• Start with customers buying stages
oWhy your segment – make useful , fun and general info
oHow – definitive, ultimate guide
oWhich – You vs others, how are you better
• Content is king
oWrite for readers
oUse tools to find segments
oAdd details, Pay attention to what works
oOnce or twice a month
oShort and small content
oBe human – Share your stories, add you style
28. Outbound advantages
• Avoid inbound dependency
• Easier to double – double the team
• Increased deal size – 3X – 10X large
• Increase market coverage
• Less competition – Inbound enquirers are checking with your
competitors also
• Small team big impact – 10% increase
29. Where outbound marketing works
• Large deals - $10-20k LTV
• Value prop – easy to understand
• Differentiated not commoditized
• Replacing other solutions
30. When outbound doesn’t work
• No management priority
• Focus on profile is not there
• Unrealistic expectations – takes 6 months to get consistent pipeline
• Needs prospecting
• Custom or commoditized
• Boiler room 101
31. Prospector and Salespeople
• Prospector does a AWAF call (Are we a fit)
• Schedues a longer demo with Sr sales whoe qualifies and
accepts/rejects
• Build a relationship between prospectors and sales
• Try new things. Keep doing A/B
32. Whats expected from prospector
• Send 600-800 emails / month
• 350-450 calls /month
• Mix social media invites
• Schedule 20 long demo /discovery calls
• 15 SQLs are accepted by sales people
34. Pipeline creation date (PCR)
• Rate at which your qualified leads are growing
• 10% m-o-m increase
35. 15/85 rule – early adopter Vs mainstream
• Early adopters – risk taker, inherently interested, need little guidance,
finds you, get started details later, doesn’t care about people
• Mainstream buyer – risk averse, only if you solve a pain, lot of
guidance, you gotta find them, lots of proofs – case studies, cares
about other people
• Stop saying MBs don’t get it or are lazy dumb. It’s not their job , it’s
yours.
36. Underestimating LTV
• Ignoring 2nd order effects of word of mouth/virality
• 10K, 12.5K, 15.625K = 38K
• 10% of time champion sells to other companies he movies
• 30% chance one of the friends purchases
• Total LTV = $60K not
38. Growth creates problems but they are better
problems
• Operational pain is less
• Diverse customers
• Sales and marketing learn to works as a team
• You understand market better now
• Product still sucks but is rich in features
• Cannot be killed by competitor only wounded
39. Jason’s 12 mistakes
• Hiring sales rep before you prove you can do it yourself
• Hiring VP before you can prove process works with 2 sales reps
• First one – two need to be good
• Actual sales target needs a lot of people
• Underpay sales
• Not going upmarket- double the deal size
• Firing a bad VP, in one sales cycle you know (6 months)
• Needs some basic experience
• Hiring from established company is bad
• 0% voluntary attrition
• Doubling the plan every time
40. Advice from VP sales
• Stop blaming others
• Build for present not past
• Hire the best
• Pay well
• CEO should be on board
41. 5 to-dos for sales
• Drive up the sales size
• Great reps perform in 30 days
• Honesty
• Great sales team stay together
• Outbound and Inbound are yes. Do both.
43. Sales people should not prospect
• Ineffective – boring for smart sales people
• Erratic focus
• Unclear metrics
• Less visibility / accountability
When people multi-task, most end up doing many things poorly
44. 4 categories of roles
• Inbound lead qualification
• Outbound prospecting
• Closing new business deals
• Post sales –
• account management
• Customer success
• Professional services
45. For small teams
• Dedicate 1,2 hours of prospecting
• 5 over linkedin, add 10 to my list
• Try daily weekly targets
• Get a buddy
46. 4 categories of roles
• Inbound lead qualification
• Outbound prospecting
• Closing new business deals
• Post sales –
• account management
• Customer success
• Professional services
47. 4 reasons to have specialized roles
• Effectiveness
• Farm talent
• Insights
• Scalability
50. Mis-hire of sales VP
• 1st sales VP generally fails
• VP sales tasks
oRecruiting 20% of time
oHelping sales team
oTactics , reach quota
oStrategy sales
• Don’t hire a sales VP till you can prove process with 2 sales rep
51. Mis-hire of sales VP
• 1st sales VP generally fails
• VP sales tasks
oRecruiting 20% of time
oHelping sales team
oTactics , reach quota
oStrategy sales
• Don’t hire a sales VP till you can prove process with 2 sales rep
52. Right Sales VP by Stage
• 1-2m – Evangelist
• 2-10m - Make it repeatable
• 10-20m - Go big
• 20m+ - Dashboard user
53. Interview Questions to ask
• How big team do we need right now
• What deal sizes have you sold to
• How you build the team
• Sales tool uou used.
• How would sales / CS work together
• Deals you lost to competitors
• FUD in marketplace
• Do you work with sales, engineers
• Revenue look at 120 days
• How should sales and marketing work together
55. Predictable recruiting
• Measure activities, conversion rates, elapsed time
• Hiring builders Vs growers
• Get them to work on account, support and product management
• When doing something new, start with 2
oIf it doesn’t work – one rep will blame crappy product, company
oIf it does – you don’t know if it’s the product or the salesperson
56. Hubspot hiring
• Hire same type of sales people
• Consistently train the same way
• Provide sales person with same quality
• Same process
58. Issues
• If churning more than 10% they are not the problem
• Missed quotas
• Team attrition
• Ramp times – 2-4 months now 6-8 months
• Rep count growing faster than lead times
• One lost sales person = 2 times the annual compensation, 5 sales
people with $150K is $1.5m loss.
59. Common causes
• Lead gen – quality of leads is bad
• Specialization – Company is not specializing
• Management – management is not connected
oDon’t blame sales people
oKeep one-to-one coaching
oGreat reps with great managers stay together
oPeople leave managers
oVoluntary attrition should be 0%
oOverall attrition less than 10%
60. Zenefits
• Marketing owns all leads
oSDR team make up mostly outbound prospectors
oPost 300 SDRs outbound prospectors are moved to sales
• 3 key metrics
oRevenue bookings
oHiring goals
oCustomer retention
61. Zenefits
• Predictability
oTo hit X rev, Hire Y sales people, 0.8Y SDR, Z implementation managers
• Sales force automation
• Hiring
• Training
• Specialization double down
62. Comp plan
• VP product for right features – 15% var cash, 15% bonus
• VP marketing- 20% var cash
• VP CS – 30% for upsell, retention, -ve churn goals
• VP and Dir of Engg- 10-15-20% var plan
64. Don’t sell, help them buy
• Find a champion
• Focus on who needs you
• Identify ideal customer profile
• Confused prospects say no
• Show , not tell – case studies, impact ,etc
65. 5 key sales metrics
• No. of total open opportunities/ rep
• No. of total closed opportunities/ rep
• Deal size
• Win rate – closed won / (closed won + closed lost)
• High win rate is bad – low win rate is not good
66. Startups should do services
• 15-20% of annual contract should be services
• 15% month on month growth
• 1m-10m in ARR in < 5 quarters
67. 14. Headcount of a 100 person
SaaS company doing $10m ARR
planning 20m next
68. Sales - 40
• 1 VP sales
• 1 VP / Director of sales Ops
• 25 Sales rep
• 8 SDRs (under marketing department)
• 3-4 sales directors (8 reps per director)
• 2-3 field sales
69. Customer success - 18
• $1.5m ARR per CSM so 15 CS managers
• 1VP and 2 directors to manage half of CSM
75. Why double the dealsize
• At $10/user, with 2% freemium to paid conversion, you need 50m
users to generate $100m revenue
• 50m users is very tough
• Small deals get you started, big deals drive growth
• Freemium has ceiling , but helps build brand
• Solution to large business = Mix small + enterprise
76. Increase the price of deal
• First time entrepreneurs - under-price their product
• Clarity in nailing a niche
• No of people involved is lots
• Selling on value with unique advantages customers cant get
elsewhere
• Ability to show impact, believable
77. Bigger deals = Better customer experience
• Better service
• More commitment
• More upfront cash
79. Deer hunters
• Deer – Good sized deals
• Rabbits- Too small, small money
• Elephants – largest, difficult to sell ,service and very demanding
80. Choose large deals only which
• You can realistically close
• Realistically help the company in a big way
• Wont kill your product or service level expectations
81. Small, mid or large
• At some point you have to make a choice, around $ 1m ARR mostly
• To become dropbox or box
• To become mailchimp or hubspot or marketo
82. Large companies buy a solution not a tool
• Solution is 3-20x more tool.
• Tool max $20,000 budget in most companies
• For solution, companies have budget of $20m, can easily spend 1-2%
for a solution
• Fly to customer
• Need account managers and dedicated professional services team
and customer success managers
84. Why professional sales team
• What works at the bottom of the market may not work as you tilt
upmarket
• Amateurs don’t know how to close a deal
• Make more money with sales team – they can increase your revenue
by 300%
• SaaS sales person acts like a trusted guide or a consultant helping the
customer through often complex evaluation and purchasing process
85. Why go upmarket
• Small customers can never drive revenue, the goal is only to do
branding and word-of-mouth
• Small customers can not help you build a large business. 4% monthly
churn means 50% annual churn
• Large customers can you you 20-30x more and also stay longer
• Keep adding enterprise level features – mostly around reporting,
admin, security, configuration, collaboration
86. Revenue impact
• One seat
$30 / m seat * 8 months = $240 LTV
• 5 seat team
5 * $30 / m seat * 36 months = $5400 LTV
87. Pricing
• Pricing is always frustrating and never perfect
• Start high and lower it
• Most SaaS companies charge $10-$60 / user
• Make that your base and charge more if you can justify value or have
a compelling use case
88. True Value of Sales person
• Salesperson is not just a communicator
• True purpose for a salesperson is to create NEW value for customers
• If a salesperson comes back and says customer has no budget for
datacenter automation, fire him. of course they wont have as data
centre automation is not established market yet. Its job of
salesperson to go out there are show customers a different and better
way of doing business which they could not think or understand
before.
89. 3 Enterprise customer questions
• Why buy? – First listen and then sell. Try to understand core IT initiatives
and link solution to them. Position yourself as a partner and not a
commodity/vendor
• Why buy from you? – Preposition and differentiate your product over
competitors. Define success in 3 buckets
o Business criteria
o Architecture/scale criteria
o Feature and function criteria
• Prepare messaging, metrics and marketing to address 3 audiences –
C level, VPs
Workgroup levels
User levels
90. 3 Enterprise customer questions
• Why buy now? – Turn value prop into quantifiable business case
• Link products capabilities, operational benefits and financial value
with companies strategic initiatives.
• Point out current operational inefficiencies and challenges in the
companies.
• Ensure your solution delivers the most important business objectives
first, => ensuring shorter time to value.
92. B2B takes a lot of time
• It takes time to get your team together, get product right, nail an
niche, see sales cycles take off
• 12 months build a product
• 24 months to hit traction
• Once you reach $5m it gets easier, your recurring engines start by
then
93. Comfort is the enemy
• What worked for you so far will be your enemy for faster growth
• Always think about scalable growth
• Learn to handle uncertainty
• Everyone has a Year of Hell post traction/scale
• Delaying known problems – firing non-performing exec, restructuring
sales team, rebranding, repackaging – leads to accumulation - only
leads to Year of Hell.