There are more SaaS companies valued at $1B than ever before – 99 as of this writing, according to Bessemer Venture Partners’ latest State of the Cloud report. The proliferation of Startup Accelerators, the availability of Seed funding, methodologies like Lean Startup and new technologies provided by the cloud ecosystem itself are making it easier and cheaper to get started than any other time in history.
It feels like every other day a company raises a large round of early stage funding and for a while they are all the hype. They have reached Product/Market fit in an exciting new field with a large market potential. Techcrunch, early investors and customers can’t stop talking about how amazing and innovative their product is. You see them at every event you go to, talking up their vision and recruiting new talent. A few quarters go by and chances are you will never hear from them again – especially if they are an Enterprise focused SaaS startup. Behind the scenes they have failed to unlock growth, burned through most of their cash and are struggling to keep the trust of their customers, employees and investors.
Unfortunately this is a very familiar movie to many entrepreneurs. Despite the increased number of unicorn SaaS companies, scaling beyond Product/Market fit hasn’t become any easier. In fact the data suggests that the odds of success seem to be worthening: according to Upfront Ventures while Angel and Seed funds have tripled over the last 15 years, the Series A and B part of the funding funnel hasn’t changed much.
Why is scaling so hard?
First, there is still a misconception that once you hit Product/Market fit you should immediately invest aggressively in growth; that it is time to hit the accelerator pedal and spend heavily on Marketing, Sales and other related hires. This is hardly surprising given that it is exactly what Lean Startup seems to suggest. However, while the focus should rightfully shift to scaling, ‘figuring out how to scale’ rather than ‘actually scaling’ should be the first step. This is especially true of Enterprise-focused startups. Thankfully, the concept of Go-To-Market fit introduced by Bob Tinker and Tae Hea Nahm is being more and more recognized and adopted.
Second, the vast majority of company founders have product backgrounds. While this is not a problem in itself and is often necessary for the innovation required to build the product in the first place; reaching Go-To-Market fit requires an altogether different approach and skillset – and more often than not a whole other person or team. Now, you could argue that this is true of any other function as virtually no founder could possibly have a complete set of skills; but the issue is that a number of product founders with little or no Go-To-Market experience abdicate all revenue responsibility and oversight to this new person or team and sometimes take the hurtful advice of well meaning investors that don’t have all the information or context from the frontline.
This leads to the final and I believe most crucial reason: while there is plenty of writing out there on how to build great products and reach Product/Market fit, there is relatively little advice on how to reach Go-To-Market fit, build a Sales growth engine, and scale to and beyond the coveted $100M ARR mark. A simple Google search for ‘product market fit’ returns well over a billion results, ‘startup sales’ will generate about 200K results and ‘go to market fit’ will net you a whopping 438 results!
Is there a better way?
Entrepreneurship in Silicon Valley and places around the world has a cherished ethos: Pay it Forward. Did sales leaders not get the memo or are they too busy making money to help others? I think the more plausible reason is that building and scaling a Sales team and a Go-To-Market function for an Enterprise SaaS startup presents unique challenges that require a different approach. Relatively few sales leaders have experienced the journey end-to-end and contributed to a Startup successfully growing to and beyond $100M from the ground up – let alone shared that experience. Sales leaders from established companies often lack the experience or an adequate methodology to take this on also. Fortunately this is starting to change with thought leaders like Mark Roberge, David Skok, Bob Tinker, Jason Lemkin, Tom Tunguz, Peter Levine to name a few sharing their wisdom on the subject. I humbly want to share my own experience alongside theirs and the approach I have come to develop over the years. I call it the Hypergrowth Sales Playbook.
What if there was a systematic way to help increase the odds of success of an Enterprise SaaS startup post Product/Market fit? That’s the question I have made my mission to help answer and I think the Hypergrowth Sales Playbook provides some of the possible answers. The playbook is not exactly a set of steps to follow (although there is a logical sequence to it) but more of a methodology, an actionable blueprint for entrepreneurs, sales leaders and any other parties interested in unlocking growth and scaling rapidly.
My goal with this blog is to share this blueprint. While it is an approach that I have come to develop after a number of iterations and stress-tested a few times personally, it is also inspired from an array of methodologies I have learned from countless sales and marketing mentors, other entrepreneurs, VCs and SaaS thought leaders that I will reference where credit is due. Whether I know you personally or have simply read or listened to your wisdom – thank you.