Steve Johnson

Have you ever looked for theory that can answer - how to approach investors - what kind of product to build first - how you’ll defend the company against competitors This new article from CDA partner, Kevin Maney extends Steven Johnson's writing from the book Emergence to #CategoryDesign. All #Startups and #VentureCapital teams should dig in. (link to article in comments)

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To scale from $1M to $10M ARR, you need to turn your ad hoc GTM efforts into a well-oiled machine. This means creating repeatable processes across your entire GTM - from lead gen to sales to customer success. The good news for technical founders is that they're experts at solving complex engineering challenges with precision, efficiency, and structure. At this stage of startup growth, they need to apply that same systems-oriented mindset to GTM - which, for B2B startups, can be approached more as a science than an art. More in the May edition of B2BaCEO: https://lnkd.in/emsvFN9q

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SaaS Buying Behavior Has Shifted: What Software Founders Need to Know The landscape for software purchasing has changed dramatically since 2021. Companies are no longer buying software for every need—instead, they’re categorizing products as either "nice-to-have" or "must-have." Here's what that means: Scrutiny is Higher Than Ever: Every purchase is heavily examined, with CFOs, head of sales, and RevOps teams now playing key roles in the decision-making process. Must-Have or Bust: If your SaaS product isn’t essential, you’re at risk. Companies demand solutions that solve critical problems. The game has changed. Has your SaaS strategy?

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Not applicable to every B2B business, but a very tactical Value Creation Hot Tip for most: implement auto-renewal / auto-reorder. Great ways to combat passive churn (churn that happens without any action on the part of the customer). Pretty ubiquitous in vertical SaaS & related industries, but found this to be surprisingly overlooked elsewhere (eg. last port-co I had an operating role at). Hit on this in the book--Winning Move #17--but check out the vid below for a deeper dive. ▶️ * * * * * Found this helpful? Plenty more where that came from. Check out the Winning Moves Platform: the ambitious PE leader's toolkit for accelerating value creation. ↳ A digital arsenal of resources, how-to's, and tools to help private equity leaders make value-generating Winning Moves with confidence. Link in the comments below. ⤵️

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For all companies, your pricing strategy dictates your sales channels. Let's take B2B SaaS Companies. If you're priced for $10 a subscription, and the focus is for individual power users to buy it for themselves, it doesn't make sense to have a sales person selling one-on-one. You'll never be able to scale at that rate! Similarly, if you're going after large ticket sizes - say $5K a month - customers won't sign up and purchase it themselves. They'll need to be wined and dined. The process will be long and involve multiple stakeholders. You need skilled Account Executives If your pricing and your GTM aren't in Sync, you are setting it up for failure. Raise your first cheque of ₹1.25Cr from 100X.VC. Apply at https://100x.vc/class12 #startups

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Before diagnosing missed revenue targets Many B2B SaaS companies only look at: - Overall CAC - General LTV - Surface-level metrics To dig deeper, here's what you should track: • Time to impact • Pipeline velocity • LTV by segment • Sales cycle length • Lead quality score • Expansion revenue • Net revenue retention • Feature adoption rates • CAC by customer segment • Customer acquisition cost payback period These metrics reveal hidden insights. Combining these metrics give you the deeper meaning.

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Average SaaS companies are seeing revenue growth rates between 15% to 45% year-over-year. But here’s the kicker: those early-stage startups can sometimes shoot for as high as 144%. If you’re not keeping an eye on these numbers, are you even in the game? Is it time to rethink how you assess your startup's growth? Let’s be real—I’ve seen too many founders focus on anything but their growth rate, thinking they have all the time in the world. Whether you're part of an early-stage SaaS or an existing player, knowing your growth metrics is not an option, it’s a mandate. Disagree? Agree? I want to know where you stand. Hit me up with your thoughts and maybe check out the insights behind this claim in a recent article. And if you're a founder looking to stay sharp in the business world, my newsletter, 5 Minute Founders, dishes out the wisdom of full business books in 5 minutes or less. Get your fast fix! https://lnkd.in/eSrmqagz

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KNOW YOUR REAL BUSINESS ECONOMICS • GAAP Revenue • Cash Flow • Cash • Contribution Margin • CAC • CAC Payback FUNDRAISING: PRESENT & SUBSTANTIATE FINANCIALS • Investor needs to know what your forecasts are • They need to believe them David Weiden, Khosla Ventures

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The transition from founder led sales -> a repeatable GTM motion is hard... Extremely hard. There are so many things to consider to mitigate risk and get as many repetitions on closed loop feedback as quickly as possible. -> what profile of a rep should I hire -> how to assess the right talent -> SDR or AE or growth hacker type or both -> what channels should we be testing -> what does good look like? What does great look like? -> how do I know if we’re making progress? And so much more… We’re discussing all this live next Tuesday at Kiln. If you’re in Utah, come check it out: https://lnkd.in/eQ9dyJK4

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Is Your SaaS Business Leaving Money on the Table by Ignoring Rate Limits? When scaling your service, rate limits aren’t just an afterthought—they’re a must. Too many businesses miss this step early on, and it costs them. Why should you care? Without rate limits, you’re paying for extra calls, whether they’re to internal systems or external APIs. Each unchecked call eats into your bottom line. Plus, storing frequently fetched data in a table can cut redundant calls and save time, budget, and server load. stories of fractional CTO. #SaaS #TechStrategy #RateLimits #CostEfficiency

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I love data. Especially people data. It helps answer those lingering..."is it just me...or?" late night questions. The OpenView SaaS Benchmark Survey is one of those annual ones I always read and reference with the founders I work with. That's why I'm so excited that High Alpha is partnering with OpenView, Paddle and Kyle Poyar to launch the 2024 annual SaaS Benchmark Survey. And guess what -- it's live! If you want early-access to the report, be sure to participate and we'll be back in November to share insights. Link to survey below. https://lnkd.in/ey9FAgYV #SaaSBenchmarks

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Cap Table guidance from Cake Equity and my former colleague Chris Hoffmann, ECA 🚀🧢 VALUATION & EQUITY MANAGEMENT: Companies should aim for balanced equity plans that are fair yet practical, involving vesting schedules to ensure employees earn their shares. Giving employees sufficient time to exercise options post-vesting can also prevent punitive exercise costs. This approach encourages loyalty and values employee contributions without overwhelming the cap table. HIGH ADMIN DEMAND IN LATER STAGES: In growth phases, especially Series C and D, managing cap tables becomes complex, with frequent hires, exits, and equity grants. Software platforms (e.g., Cake) are essential to keep cap tables organized, as manual systems like Excel can't handle the volume and complexity efficiently. IMPORTANCE OF DAILY & MONTHLY AUDITS: Regular audits are crucial to keep track of terminations, new grants, and board consents. Errors in terminations and grants can lead to costly issues during audits, financial reporting, or funding rounds. SECONDARY TRANSACTIONS & LIQUIDITY OPTIONS: Allowing limited liquidity for employees and early investors, such as through tender offers or company-facilitated secondary transactions, is valuable. These mechanisms offer flexibility without requiring a full exit or IPO, which has become less common due to the IPO market slowdown. CAP TABLE ERRORS CAN BE COSTLY: Historical errors in cap tables can create major headaches. Two examples highlight this:    - In one case, a series D company had to spend $100,000 to $150,000 on cap table corrections, which delayed planned transactions by six months.   - Another company had converted multiple financing rounds incorrectly, requiring a year and a half of back-and-forth with attorneys and investors to correct the errors. These situations emphasize the need to organize and verify cap table data from the outset to avoid costly fixes later. RECOMMENDATIONS FOR FOUNDERS: Early-stage companies should seek expert help in setting up and maintaining cap tables, even if through fractional CFOs or specialized attorneys. Organizing all equity-related documents digitally, using reliable software, and conducting regular audits can save time, money, and stress in the long run.

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I meet and talk with 5-10 of the greatest GTM minds on the planet every week. CRO’s, VPs of Sales, CMO’s. 100% agree that getting outbound right is one of the hardest parts of their business, why? 1. Recruiting is hard again The same voices that sold tech sales as an easy path to 6 figures are now the voices saying the BDR role is dead. They sold a bill of goods to people who didn’t understand how hard this role is, are surprised these people who chose a path because it was sold as “easy” aren’t performing, and now have ulterior motives to pivot to a new message. Hard jobs are hard to recruit for. 2. Lack of Leadership 2020 through mid 2022 we had a bunch of capital bloat and talent bloat enter the market. Just like we have overvalued “zombie” companies we have overvalued “zombie” leaders who don’t know how to coach good habits for this type of market. Outbound was easy from 2014ish to summer 2022. 8 years is a long time, most of the voices we hear only know those times or only know what type of sales motion. 3. Absolute statements muddy the waters I've been around the block enough to click on their profile and see their track record. 99.9% of folks make these statements only sold transactional commodity technology, sold to GTM teams, or in most cases – only both. What works depends on multiple factors: ASP, buyer persona, and complexity of your sales process/customer’s buying process. Depending on what you sell – sometimes you are going to need to pick up the phone or send a note to get someone’s attention. That will NEVER change. 4. Generational consideration for career pathing is key BDR is still hands down the best route to market for future AE’s. You have to learn to prospect and get meetings before you can run a meeting, qualify, and manage a deal. No argument from me on CAC math – thousands of products require veracious qualification, deal management, and creating customer consensus. You can not run those types of deals and prospect. If any Voice had EVER done that type of role or ran a team that did, they wouldn’t say what they are. For BDRs to stick around for more than 14 months, you need steps in the BDR path where comp, responsibility and role grow over time. 5. Results are tanking Point 1&2. You are the equivalent of a fire fighter that starts a fire then takes the glory when you put it out. I absolutely loved the movie Backdraft – but stop it. These are the ideas of “not famous” GTM people. People who spend all day serving their customer and developing their people – not posting on this platform. They don’t care about clicks, followers, or impressions. They care about revenue and earnings. Outbound is hard. It (almost) always has been. Ya’ll need to block the noise and focus on what works for your business and try everything. Even the hard stuff. #AllGasNoBrakes #DialedIn

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I don’t think I’ve experienced more challenges in my RevOps career than trying to build GTM for 𝐜𝐨𝐧𝐬𝐮𝐦𝐩𝐭𝐢𝐨𝐧 𝐛𝐚𝐬𝐞𝐝 𝐩𝐫𝐢𝐜𝐢𝐧𝐠 companies. Myself, Bernardo Alves (our head of RevOps strategy), and Kyle Himmelwright sat down to discuss all of the challenges we have faced and some tactical solutions that we've seen work. Bernardo and I started working together at Emailage, a company fully built on a consumption based pricing model where we faced our first challenges building GTM around this model. With LeanScale, we’ve also worked with multiple AI-as-a-Service companies that are typically built on consumption based pricing, and we know this is where most companies are going in the future. Kyle has had an impressive operations career and has also been an operator in multiple companies with consumption based pricing models, bringing a unique and practical perspective to the conversation. 𝐃𝐮𝐫𝐢𝐧𝐠 𝐭𝐡𝐞 𝐩𝐨𝐝𝐜𝐚𝐬𝐭 𝐲𝐨𝐮'𝐥𝐥 𝐥𝐞𝐚𝐫𝐧 🎯 How to 𝐟𝐨𝐫𝐞𝐜𝐚𝐬𝐭 in a consumption based model 💰 How to set up 𝐜𝐨𝐦𝐩 𝐩𝐥𝐚𝐧𝐬 and quotas 👷‍♂️ How to 𝐬𝐭𝐫𝐮𝐜𝐭𝐮𝐫𝐞 your sales and CS teams 📊 How to articulate your “𝐀𝐑𝐑” - the metric most companies consider their north star ⚙️ 𝐓𝐨𝐨𝐥𝐬 you can use to help make the process easier

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If I was going to jump into a GTM Operator role again. I’d look for the unsexiest industry I could find that’s being disrupted by AI. There are still huge swaths of the economy that have been largely ignored or forgotten about during the software revolution. Instead of solving real world problems, founders & VCs got obsessed with solving the problems that were right in front of them every day - problems that mainly exist just within other software companies. Competition exploded and we were all left wondering why it was so hard to sell or market anything? Just take a look at your own value proposition: you’re likely trying to sell ‘incremental improvements’. A 2% efficiency gain, 5% of your team’s time back, a 4% better win rate, a 7% boost in productivity, slightly better data visibility, etc. etc. I remember when I first got into Tech, most of us were selling true digital transformation. We were going to be the trusted partner that changed everything about their business, ushered them into the digital age, gave them access to mobile customers or brought them into the cloud. These were huge ‘need-to-have’ initiatives that demanded attention and respect. Not a ‘nice-to-have’ afterthought that felt like a burden even just to take an initial meeting. The good news: I believe we’re at another inflection point with AI where we can go back to selling/marketing true business transformation. And there’s no better place to showcase this transformation than in unsexy, forgotten about verticals. Many of which are still on software V1. They are slow adopters but with AI/software becoming easier and easier to use, I believe this is all going to change and they will start to welcome innovation with open arms. Then you’re no longer a sales person or a marketer but a true agent of change. That’s when things become fun again, that’s when you feel like you’re having a real impact. Is it still hard? Yes. It's really hard to be a real partner who they are relying on to understand where the world is going - you need to grasp their entire business, where they are, where they are going and where they want to go. It's a big responsibility and you have to come correct. So yes, it's still hard but a different type of hard that is incredibly rewarding when done right. The unsexy is about to get real sexy again.

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When stuck in a scenario where revenue is growing at a moderate pace, but not fast enough and burn is putting the pressure on getting to the ARR target of $1M+ faster, Founders need to find a way to grow revenue quickly. One thing Founders get advice on is “increase the deal size and you only need X deals to get there.” The problem is, it’s not just about hitting a revenue milestone, it’s telling the story of your ability to acquire and grow your customer base for the next 10+ years. 

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Great conversation with Joey Brodsky! Definitely one of the sharpest guys I know. I love his passion, drive and unique perspectives. I have followed his podcast for a long time and was super happy to be able to be a guest. I will share more insights from our time together but wanted to post a quick thank you to Joey and share the episode. #NextGenSales

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Your operating partner isn’t here to help—they work for the PE firm CTOs and tech leaders, don’t mistake the operating partner for a friend. Their job is to evaluate your every move, report back to ownership, and build project plans that outperform yours. And when you’re not delivering, they’re already scouting your replacement. But when you clearly demonstrate your financial impact, you’ll earn their respect—and protect your position.

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Whether you're dipping your toes into SaaS acquisitions or looking to expand, understanding the diverse buyer profiles is key. Here's a quick rundown of SaaS acquirers by purchase price to identify where you fit and how to strategize: // <$250k: Side Hustlers: Look for low-maintenance, simple products. Ideal businesses demand <20 hours weekly and minimal support. // <$500k: First-Time Acquirers: With a technical/GTM background, focus on businesses matching your skills, requiring less than $500k capital. // $500k-$1M: Professional Portfolio Acquirers: Experienced? Aim for stable, recurring revenue businesses, managing 5-10 companies with 15-30% EBITDA margins. Serial Acquirers & Niche Specialists: Quick scalability or niche alignment is key, targeting businesses for growth and a perfect fit. // Over $1M: Corporate Integrators & Small Financial Sponsors: Major players seek strategic alignment, investing $3M-$10M for a 20-30% ROI. /Industry Consolidators & Strategic Diversifiers: Focus on efficiencies, market dominance, or diversifying through innovative models. A Reminder: Micro SaaS is a unique field — untouched by Institutional Private Equity and Strategics below $5M ARR, presenting a lucrative avenue for those ready to play smart. Which profile resonates with you? Whether you're aiming to buy, grow, or sell, positioning yourself correctly in the Micro SaaS universe is crucial. 👉 For a deeper dive into each buyer profile and strategic insights tailored to your journey, connect with us at Skaling Ventures. Link to substance in bio... #MicroSaaS #SaaSAcquisitions #StartupGrowth #SkalingVentures

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