As the CEO of a startup, what should I tell my employees who keep asking for raises after they realized we just raised a new round of funding?


This post is by Jason Lemkin from SaaStr


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Two meta-thoughts:
  1. First, you have to decide if you are going to “hold the line on burn” after a fundraising. If you plan to — tell everyone. They will get it. Is your goal to hire 100 reps next week and 10x the marketing plan? That’s one approach. But everyone will expect all budgets to grow overnight. Another approach is to use the capital as a “buffer” so “we have plenty of runway”. If you communicate you are doing the second approach, most folks won’t expect out-of-turn raises. They’ll get the goal is to de-risk the company, not to grow the burn rate.
  2. Two, sometimes — sometimes — some people do deserve a raise after you close a round. Are folks taking under-market salaries? If so, marking some up closer to market after each round can make sense. My rough rule is after you raise $2m, the founders shouldn’t work Continue reading "As the CEO of a startup, what should I tell my employees who keep asking for raises after they realized we just raised a new round of funding?"

If you had to hire B2B salespeople based on resume only, what kind of things would you look for?


This post is by Jason Lemkin from SaaStr


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Here’s what I look for to try to get a sense if they’ll perform:
  • Do they call out top performance with metrics? The best reps are often quite precise. E.g., hit 152% of Quota last year, 143% year before, etc. Maybe they are exaggerating, that’s besides the point. The question is, do they love to win and have a history of it? Metrics are a good indicator here.
  • Have they sold at your core price point? This may be a little work, but look at where they worked and see if it’s a fit for your price point. If not, maybe move on.
  • Are their LinkedIn recommendations solid? Yes, of course these can be gamed a bit. But I don’t mind that. That’s part of sales. Most top reps and top leaders have 3+ glowing LinkedIn recs. I just want to see them there. Tablestakes.

What are some of the best founder exits from a start-up?


This post is by Jason Lemkin from SaaStr


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Probably deals where the founders made > $1b each. The data here isn’t my strength, but let’s make a partial list for U.S. start-ups pre-IPO:
  • WhatsApp Founders, $5.5b (+-) each (2 founders). It’s likely they made more with FB stock appreciation.
  • Qualtrics Founders, $1b+ each (3 founders). Sale to SAP. Pretty good for SaaS.
  • GitHub Founders, $1b+ each. Sale to MSFT.
Others made more, e.g. Reid Hoffman at LinkedIn, but they had to go through an IPO first. The IPO itself was an exit and we probably shouldn’t count it for this list. View original question on quora The post What are some of the best founder exits from a start-up? appeared first on SaaStr.

Should all CEOs be required to have annual leadership training?


This post is by Jason Lemkin from SaaStr


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Required is a strong word … but the answer is Yes. Everyone can benefit from leadership training. Especially, the folks so senior that traditional training doesn’t cover them. Who trains the trainer? We just got back from the SaaStr Fund founder retreat and while I was a bit reluctant to do it, we did leadership training. This year it was focused around messaging and presenting your company. Everyone loved it, from prenicorns like Algolia to folks that are still becoming rocketships. As CEOs, we all tend to find mentors over time and they do help. But that’s not the same as training. We have blind spots, we fall into ruts, and we only have the experiences we have. Mediocre training programs are tough on everyone, and I tended to walk out of some as a CEO and a VP. But the great ones, we all need. At $1m, $10m, $100m, Continue reading "Should all CEOs be required to have annual leadership training?"

Will individual employees ever be able to sign up for SaaStr Pro for personal Learning & Development? Has there been any sort of traction for this idea? (i.e. Treehouse)


This post is by Jason Lemkin from SaaStr


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Probably not for a little while. We tried this in the beginning, but there just was too much “sales” friction for an individual vs. a team. We want to get there, though. The current product is 100% focused on group learnings. We’d need to evolve it into a different product. But we do want to do that, too. View original question on quora The post Will individual employees ever be able to sign up for SaaStr Pro for personal Learning & Development? Has there been any sort of traction for this idea? (i.e. Treehouse) appeared first on SaaStr.

Why did Slack file for a direct listing rather than an IPO?


This post is by Jason Lemkin from SaaStr


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Because you save a lot. You save a lot on dilution, and a bit (but not THAT much) on fees. When you IPO, you generally sell 15%-20%+ of the company, inclusive of a green shoe. And investment banker fees can approach 6%-7%, all-in, of what you raise. Think of that as much as 25% effective dilution when you IPO. That’s a lot of dilution. It’s like another large venture round. Now, if you need the money to IPO, it doesn’t much matter. And it’s still often a relatively efficient way to raise capital. And it does follow a more established pattern than a direct listing, which can make it easier to sell stock through an IPO. You also lose access to a true army of agents out their selling your stock for you in a traditional IPO. Your brand really has to sell itself to do a direct listing. This
Continue reading "Why did Slack file for a direct listing rather than an IPO?"

What specific factor can sales teams implement to improve overall sales performance? How should sales team meetings be managed, what are key metrics to measured and what are ways to improve cold-calls?


This post is by Jason Lemkin from SaaStr


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Training. Training the single most important factor you can do to increase sales team performance:
  • Onboarding properly.
  • Initial co-calling and co-selling.
  • Building collateral the team can use.
  • Creating scripts for calls for them, and training them on using the scripts.
  • Creating a key questions and objections list that is dynamically updated.
  • Helping them understand the competition.
  • Using the SDR position as a stepping stone to AE (and training grounds).
  • Using tools like Chorus.ai to monitor calls and make sure reps are properly answering questions.
  • Etc. etc.
Yes, this is a lot of work. And yes, for your first few reps, you can get away with sort of not doing it and training them by osmosis. But everyone falls apart after reps 2–3 or so if you don’t train them. Both initially, and continually. More here: You Have to Train Reps 3-10. They Won’t Train Themselves. | SaaStr View original Continue reading "What specific factor can sales teams implement to improve overall sales performance? How should sales team meetings be managed, what are key metrics to measured and what are ways to improve cold-calls?"

At what stage should a startup hire a CMO?


This post is by Jason Lemkin from SaaStr


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Roughly, when Demand Gen is no longer the core function of marketing. This also often is the time when you are ready to expand beyond a core small, effective, efficient marketing team. When you have enough of a lead generation engine going, AND enough of a brand, that brand and corporate marketing strategy and positioning are more important than finding new leads and helping search out raw new opportunities. Put differently, once you truly have an established brand in an established category, the game changes. It’s then less about letting folks know you exist than letting them know why now is the time to buy. And reminding them why to buy from a/the leader. Often this is roughly around $20m ARR. Until then, maybe focus first on a VP of Marketing whose #1 job is being VP of Demand Gen. You can add the rest on top of that engine. Continue reading "At what stage should a startup hire a CMO?"

Is there anything like a perfect cold email that a technology salesperson can send to a prospect? It’s all so inundated and crowded. How do you get an executive’s attention to what you’re selling in the tech services world?


This post is by Jason Lemkin from SaaStr


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Email is amazing. Why?
  • It is open, and
  • Almost everyone in business checks it multiple times a day. And importantly,
  • Senior folks are super-engaged with their inbox. They do less work themselves, and spend more time monitoring what their team is doing. Sometimes, senior execs do little more in a crowded day than attend meetings — and monitor their inboxes.
This is a gift. No matter how many emails a prospect is sent, they have to keep checking their inbox. But yes, the number of outbound prospecting emails continues to grow dramatically. So the key is make that email, that subject line, just amazing. Make it solve that exec’s top problem. Uniquely and today. If you do that, you’ll get a response. She’s checking email, after all. Just make it truly great. View original question on quora The post Is there anything like a perfect cold email that Continue reading "Is there anything like a perfect cold email that a technology salesperson can send to a prospect? It’s all so inundated and crowded. How do you get an executive’s attention to what you’re selling in the tech services world?"

How do corporate venture capital firms different from conventional venture capital firms?


This post is by Jason Lemkin from SaaStr


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They aren’t as dependable. This doesn’t mean they are “worse”. It does mean be careful how you use them. This is issue #1. A few like Salesforce Ventures and GV are an exception, but let me explain:
  • Corporate VCs often do not write a “second check”. But most institutional VCs save reserves for another check, if you are doing OK but not great. Institutional / financial VCs have motivations to bridge you if you need it. Corporate VCs often do not.
  • Corporate VCs rarely lead rounds. What is most valuable is a lead. Someone to write the first, main check. Few corporate VCs do this. At least not for the earlier rounds.
  • Corporate VCs are Fair Weather Entities. They can come and go when corporate strategies change. Again, this is less likely with Salesforce Ventures and GV, etc. But be wary of newer, less proven entities IF you need something Continue reading "How do corporate venture capital firms different from conventional venture capital firms?"