In B2B SaaS going upmarket is often the only way to keep on growing at a decent rate over time.
Many founders and operators still struggle with that idea and often they miss the execution of the most appropriate game plan.
I’ve seen many CEOs, VCs and startup operators having a “pure” Product-Led-Growth mentality for too long. They focus on usage, usage, usage.
They want the product to be cheap, horizontal and with zero or little sales support. The product needs to sell and serve by itself.
This is a nice concept but the issue is that this is an “exclusive” game for a few players. Sooner rather than later most B2B SaaS businesses realize that they need to embrace sales and customer success led models focused on going upmarket.
Going upmarket should be like following the North Star.
Deciding to go upmarket doesn’t mean necessarily a drastic change or going just to big enterprises. It’s subjective and there is no one-size-fits-all recipe, although a few Principles stand out from the long list of factors that can influence the success or failure of an upmarket strategy.
#1 Focus, Segmentation and Account Based Model
You need an accurate segmentation and a profound strategic work of focus and strict execution if you aim to go upmarket and grow average revenue per Account.
On an operational level you need to implement Account Based Models with SDRs, Account Executives and Customer Success engines.
Marketing needs to be 100% aligned. Stop hiring inbound marketing experts promising the magic funnel. The funnel became dark in the last few years. There are 297 billion emails sent out for marketing purposes for 7 billion world inhabitants.
You need the right tech stack too. The industry has evolved exponentially in the last 3-5 years. Don’t go cheap on that!
“Deciding what not to do is as important as deciding what to do.” Steve Jobs
#2 Hire people with experience and don’t stretch too much.
When the game gets serious you need people with proven experience.
If you give too much responsibility to junior folks and then things get difficult and there is too much pressure (which happens all the time in high-growth scaleups), it’s not going to work.
Don’t stretch too much. Not only hiring juniors and asking them to deliver like seniors. Also don’t expect that a salesperson who is good at selling 15K deals is also good at selling deals of 100K+ in ACV (Annual Contract Value). Or expanding Accounts from 100K to 1,000K in ARR.
#3. Modern Leadership
At the right time you need a Revenue Leader who knows how to build a team and execute the game plan to move upmarket. You need a coach on the court. Not advisors or consultants. No shortcuts.
“The required profile of the sales LEADER has really changed to become more of a leadership profile. World-class managers today are defined not just by their ability to coach to the known, but by their ability to innovate around the unknown”. The Challenger Sale.
#4. Review your Funnel and Playbook
Your funnel and sales playbook need to evolve as well.
For selling small and transactional deals the most used funnels in the tech industry have got “long necks” and “short legs” (quite dense at the top and very basic at the bottom), like the funnel below.
To get bigger deals you need a different type of funnel, a funnel with “long legs” given that it’s in middle and bottom of the funnel that most opportunities get stuck. That’s where you need more granularity and attention to detail.
An example of a proven funnel for deals above 50K in Annual Contract Value is below.
#5 Review your pitch approach and focus on quantifiable outcomes for the customer.
Going upmarket means also an evolution of the way you communicate and what you communicate.
Sales cycles get longer, the (1) number of stakeholders you are in contact with in the same Account goes up and (2) you need to build a different narrative around (3) a sequence of touch points.
Talking about generic benefits and doing cold product demos it’s not as effective as with smaller deal sizes or the initial growth phase of the company.
Yes, of course you need to talk about your product BUT first of all show them what’s in it for the business. Don’t show just your product and how beautiful and usable it is.
Prospects want to be showed the products through real stories where they can see themselves reflected.
You should build teaching pitch choreographies to have an authentic conversation with your prospects about “Type B Benefits”, as very well conceptualized by the SPIN selling methodology more than 30 years ago.
How do you get your entire sales force to tailor their approach to each individual stakeholder’s most pressing needs?
#6 Review your Customer Success formula
When you go upmarket your Customer Success approach may need a change. When you sell transactional deals or even deals up to 20-30K in ARR it may make sense to have two separate organizations: Sales handing over 100% a new Client to Customer Success.
Depending on how much upmarket you want to go, this will likely need to evolve. Selling and Servicing become a team efforts and Strategic Sellers (Strategic AEs) work together with Customer Success Champions (CSM), organized in Squads.
In such circumstances Customer Success should not be responsible for Upselling and Cross-Selling. Customers don’t need another Sales person. They need a Trusted Advisor with a different approach. This is not about selling 5 or 10K ARR. You need different people, a different CS funnel, even a different bonus scheme.
Complex topic. What am I missing here?
If you enjoyed this post, you will also like Game Plan for a Healthy Go-To-Market in B2B SaaS and Is the “classic” VP Sales model broken in mainland Europe? and SaaS Revenue Leaders. How to reduce the 3 main risks in VC-backed startups.
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