Scaling SaaS — Insights from founders

In the last couple of months, we’ve continued our scale-up dinner series for SaaS founders with events in London and Berlin, chaired by our Venture Partner, Kevin Kimber, EMEA founder of success story Service Now ($30bn market cap). We’ve covered a range of topics from customer success to internationalisation. Here’s a snapshot of the takeaways:


The customer success safety net

-What is the definition of customer success? Companies get to a size where customer support, sales and development no longer gives customers enough ‘care’ so customer success is needed. Customer success is about retaining, extending and ensuring the long-term success of customer engagements and shouldn’t be pulled into free consulting or customer support

- Customer success can create real value for customers, using insights and data to create a tight alignment in the customer vendor relationship

- In the early days of a company, customer success is the responsibility of the full team but as a company scales customer success deserves a dedicated function, done right it can add real value to both the customers and the company

- Your customers can’t be expected to automatically decide to renew their contracts, invest in customer relationships and don’t rely solely on the sales team. You need an incentivised, dedicated customer success team

- Typical responsibilities of a customer success team include on-boarding, retention, customer health, and there was some discussion about whether up-sell and cross sell are areas that should be managed by customer success or sales

- Customer success is an evolving job function with many routes in from other functions, with typical backgrounds for the strongest candidates coming from consulting, customer support, product management, sales and account management and customer services. A strong knowledge and interest of the software products is important along with good account management skills

- The challenge with hiring and scaling a customer success team is that most candidates have either a bias towards sales and commercial elements of a relationship or the more technical elements. Good customer success teams tend to be more technically biased and serve as the bridge between sales, customer support, development and consulting/ A clear delineation of responsibilities is needed to ensure clarity both internally and within the customers

- Customer success if your safely net, a happy customer will spend more money…

- Remember that it’s easier to keep existing customers than to acquire new ones, SaaS companies with successful sales and customer success functions can drive as much as 30% of quarterly revenue from up-sells

-There is often tension between customer success and up-sell — establish what that balance is. In some cases, customers have been known to take advantage, using the support team to solve business problems rather than problems with the product

-US customers often have different expectations to European customers, adapt as you expand so you continue to serve all your customers

Building a high-performance sales culture

- Define your culture and hire to it, if you hire the right people and create the right culture then you can build an effective sales team. For more on hiring for sales success, read this blog by Kevin

- This HBS article defines the seven personality traits of the top salespeople -and can provide a useful benchmark

- Dedicate time to new members of your sales team, get them up to speed and loving the product as quickly as possible

- At the beginning CEOs are often very involved in the sales process, but as the company grows that’s no longer realistic and the sales people need to have the same mentality. They need to step up and represent the company

- The best sales people will always put more pressure on themselves than management can. If the pressure comes from sales management then it can be negative. Building a hiring process and culture of personal accountability and pressure drives high performance. This also allows sales leadership to be focused on continually raising people’s horizons as to what’s possible

- Clearly define the sales process and have clarity of vision. Map out each individual step, create data driven accountability and shared goals for the business which can be developed into personal focus areas

- Good comp plans can change outcomes, align comp plans to the corporate objectives and invest in your team, by giving them the right training and tools

- Support sales teams by creating a culture that allows for frank conversations and straight talking

Scaling to the States

- Deciding on your first office location abroad will either be because you’re building an office around your talent (relocation etc.) or because you are following a client

- For most European SaaS companies, expansion to the US is the number one priority and the first rule is to think big. Small operations don’t work especially in the US…

- Remember East and West Coast differ massively and getting it wrong and not ‘fitting in culturally’ from the start is highly damaging. Behave like you’re a US company and show you believe 100 per cent in the market potential

- When it comes to building a team, the West Coast is renowned for difficult staff retention — “everyone has access to your talent” but you need to make sure your US sales force is based in the US, a sales force from another country may not be aggressive enough to sell in to the US

-Your marketing efforts need to make it clear that you’re operating in the US, have an internationalised website and consider hiring Americans even in the UK


If you’d be interested in attending one of our future Scaling SaaS dinners send an email to events@eightroads.com and follow us @8roadsventures for updates.