Published on November 8, 2014
The 10 Key Revenue Mistakes I Made Getting to $100 Million Arr by Jason Lemkin
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1. My Top 10 Mistakes On The Way From $0 to The First $20m ARR Don’t Do Them. You’ll Grow Even Faster. More Success. Less Stress. Jason M. Lemkin SaaStr Managing Director, Storm Ventures; Founder/CEO – EchoSign/Adobe; @jasonlk saastr.com & quora.saastr.com
2. All about Jason M. Lemkin 2x Founder/CEO Selling to the Enterprise. Managing Director, Storm Ventures. Co-Founder/CEO EchoSign, acquired by Adobe, 3000+ 5-star reviews on AppExchange Grew business from $0-$100m+ ARR in ‘13 at EchoSign + Adobe Managing Director at Storm Ventures: First/Early Investor in Enterprise start-ups, including Marketo, MobileIron, EchoSign, GuideSpark, Metacloud, Talkdesk, Algolia, etc. SaaStr social community – 800k+ views a month on web + Quora
3. Mistake #1: Not Hiring 2 Sales Reps. A/B Test Helps You Learn Any Sales Rep That Performs is Cheap 1 Rep Performing = Repeatable. 2+ Reps Performing = Repeating.
4. Mistake #1: Not Hiring 2 Sales Reps. You Have to Sell It Yourself First. And Then Hire 2+ Reps. You You + 2 Reps Hire VP Sales
5. Mistake #2 – Hiring Early Reps I Wouldn’t Buy From Later – It Takes a Village Later, you’ll need many types of reps. Eventually. But in the early days – leads are so precious. You’ll never be comfortable to handing them off to someone you don’t trust. Someone you wouldn’t buy from.
6. Mistake #3 – Not Seeing The Pattern Early Enough. The Pattern is Set EARLY - $1m ARR Once it’s repeating – be confident. You’ll have an “organic” type of core customer. So from $1m - $10m ARR – just double down on what seems to be working. Deal sizes, etc. will go up. But pattern will stay same. It will keep working. It will.
7. Mistake #4 – Not (Intentionally) Going Upmarket Faster. Nothing is an Anomaly If You Can Get 1 enterprise customer – you can get 10. If You Have 1 customer in an industry – you can get 10. The outliers aren’t anomalies. They are The Future. Corollary: Go Upmarket as Soon As You Can. More $$$, Same Work.
8. Mistake #5 – Not Seeing the Power of a Mini-Brand Brands are Highly Defensible. Proxy for Whom to Trust.
9. Mistake #6 – Ever Allowing Revenue Per Lead to Drop Revenue Per Lead Should Never Drop. That’s Your Fault. PR. Marketing. Upgrade the Team. More Customer Success. Competition doesn’t really matter for RPL – if you have a great team and a relative competitive advantage. Deal Sizes should only go up. You should only get better at closing.
10. Mistake #6 – Ever Allowing Revenue Per Lead to Drop Leads Doubled in Year of Hell Yes, We Grew. But, Revenue Per Lead Declined. Whose Fault?
11. How Brendon Doubled Sales in 90 Days Hint: It Wasn’t New Prospects or Customers. Immediately Upgraded the Team to Proven Closers. The First Week. Got the Most Out of the Team He Inherited – And Got Rid of the Ones That Weren’t Working. • 1 + 2 alone Doubled Our Revenue Per Lead. He Didn’t Even Attempt to Do It Alone. He Ended Pipeline as a Metric – And Any Real Credit for It. He Embraced Competition.
12. Mistake #7 – Too Much Time on Prospects v. Existing Sales Is Just the Start of a 5-7 Year Journey. Visit all your top customers. Not just propsects.
13. Mistake #7 – Too Much Time on Prospects v. Existing Get Off the Mac. And On a Jet. Visit ALL Your Best Customers. And ALL Your Top 20% of Revenue Customers. ALL of them.
14. Mistake #7 – Too Much Time on Prospects v. Existing Happy Customers will churn if you don’t visit. Unhappy customers will stay – if you visit. Year 3 is when you lose them. Hard to see in early days.
15. Mistake #8 – Not Firing a Bad VPS in 1 Sales Cycle You Should Know Subjectively In Just a Few Months – Just 50% of The Way Through Your Average Sales Cycle Numbers Should Increase in 1 Sales Cycle – with Keen Focus on Revenue Per Lead First Few Hires Should be Clear Upgrades – and made quickly + seemingly effortlessly
16. Mistake #9 – It Get SO Much Better at Initial Scale •No Matter How Bad You Are at X, or Inexperienced at Y … You Will Learn in SaaS. •Everyone Great Will Get Ever Better. •You Will Get Even Better. Guaranteed. •You Will Become a Great SaaS CEO.
17. Mistake #9 – It Get SO Much Better at Initial Scale
18. Mistake #10 – Not Doubling The Plan. Once the team was (finally) Great – We Exceeded the plan. Every quarter, every year. Always. But I should have challenged us to do Even Better Than 120% of Plan. How? ….
19. Imagine a World … (1/3) Image a World Where Capital Doesn’t Matter. Image a World Where You Can Hire Whomever You Want. Imagine a World Where ROI Can Be Measured in 36 Months. Then … What Could You Do?
20. Imagine a World … (2/3) • For Sales, who would you hire, and when, if you could hire as many people as you wanted? • For Marketing, where would you spend if the ROI could be ‘any’ ROI? What brand marketing would you do? What new programs would you develop? • For Product, what new areas would you enter? What new products would you build? • For Engineering, what would another 10, 20, 50, 100 engineers do for you? What would you rebuild? Improve? How many more features could you push out? What could you do that is simply, super cool for your customers?
21. Imagine a World … Why it Works (3/3) The Mediocre Ones just Spend, Spend, Spent in this Exercise. & The Real World. But the Great Ones – Only Spend On What They Think Works. The Great Ones Do Things They Are, On Balance, Always Accretive. So as CEO … Just Find a Way Here. To This World. That’ Your Job.
22. When It’s Good – It’s Really Good Great Teams Have Low Turnover – They Want to Stay Together Great Teams Feed on Themselves Great Teams Energize the Rest of the Company Spend 20% Of Your Time Recruiting!