The Latest from SaaStr: Around Year 5, You’ll Have to Build Your Third Management Team

For 90% of us, one of the toughest adjustment to being CEOs of SaaS companies is having to constantly recruit.

Once you have Initial Traction at least, you’re going to have to spend at least 20% of your time recruiting. And really, 50% would be even better.  

As soon as you have something in SaaS, you have to stop being an individual contributor as much as practical.  Stop being a functional VP-as-well-as-CEO as soon as you can.  Let it go.  Hire those folks instead, as soon as you can afford it, and have Initial Traction.

But it’s even more than that.  

It’s more than just recruiting a management team.  Because once you finally get your first management team in place, some of them will be a mismatch, or just only a good fit for the next year or so, or end up better as directors or team leads, but not VPs, etc.  

So you’ll be lucky if half of the management team you build at $1m ARR is there at $8m in ARR.  They may all still work for you — I hope they do.  But many of the VPs you recruit around $1m in ARR just won’t scale, or fit, at $10m in ARR.

While the allure of customer acquisition can pull a founder’s attention, it’s equally important to dedicate resources to fighting churn and expanding revenue from existing customers. One company that has unlocked the secret to solid retention and revenue expansion is Brex, an easy-to-use corporate cards and spend management software in an integrated global solution.  

In this edition of CRO Confidential, Sam Blond (former CRO at Brex and current Partner at Founders Fund) hosts his former colleague Lucas Fox (GM of Brex for Startups). They discuss how Fox helped build a churn-fighting, upselling, and cross-selling machine that continues to generate revenue.

This edition of the SaaStr Daily is sponsored in part by SAP

Revenue has always been at the top of list of "Things Businesses Want More Of."

But not like this.

A global SAP survey shows companies are seeing beyond traditional growth tactics and are shifting focus on sustainability as a critical way to boost revenue, increase efficiency, and mitigate risk.

I’ve interviewed 100s of VP of marketing candidates over the past years and I can tell you one thing — it’s easy to spot the ones that won’t work out.

How?  It’s not that they aren’t smart, or driven, or thoughtful in most cases. 

It’s that they are a mismatch.

Especially in skills and interests.

There is just so much to do in marketing, from product marketing to brand marketing to customer marketing to, of course, demand gen.  And really, most VPs of Marketing just want to focus on their 2-3 most favorite things to do.  You have to make sure those are your top 2-3 needs, as well.

So with that, let’s add to our classic Top 10 Interview Questions for a VP of Sales and also our Top 9 Interview Questions for a VP of Customer Success with … Our Top 10 Interview Questions for a VP of Marketing!

At SaaStr, our partners are an integral part of our events. In June 2023, we’re heading back to London for SaaStr Europa and we wanted to give a special shout-out to some of the companies that will be there with us!

We’ll see 2,500+ of the best SaaS founders, execs, and VCs June 6-7 at 2022 SaaStr Europa!  Grab tickets here.

Join these incredible companies to experience all the value of SaaStr!

This edition of the SaaStr Daily is sponsored in part by MERGE

Merge’s Unified API allows you to access 150+ integrations across HR, payroll, ATS, accounting, CRM, and ticketing systems.

Most SaaS markets are crowded today. But the thing is:

As Bigger SaaS companies cross $100m in ARR, and then $1B in ARR, they stop focusing on smaller niches. They might give up on SMBs, or freemium, or higher churn segments. But you might be able to do well there.

Many Bigger Cos aren’t vertical-specific. There can be room for a vendor focused just on e-commerce, or healthcare, or contact centers, or other large markets. For example, Mailchimp is very strong in general email but Klaviyo is worth $10B doing email for e-commerce.  Gorgias did the same for contact center in e-commerce.  Veeva built a pharma-specific CRM on top of Salesforce and that product took them all the way to IPO.

Many Bigger Cos aren’t invested deeply in a particular platform.  E.g., their Shopify or HubSpot integration might be weak.  Or not even exist.

© SaaStr 2022

255 Kansas, Suite 300, San Francisco, CA 94103

If you'd like to stop receiving the SaaStr Daily, click here