Reigniting Growth

Transform your Sales & Marketing

Houston, we have a problem…

It was time for a change. Redbooth had left the initial enthusiasm phase with a stellar growth rate. It had hit the reality check of a two years of flattening growth. Worse yet, previous attempts to reignite growth had only set burn ablaze—reaching more than 3x our revenue.

I had spent those two years leading product. I was executing on a big vision, one that would transform the way people worked. We were a recognized leader in our space, slugging way above our weight class. In January 2016, I became COO with a mission to rebuild the growth engine in mid-flight.

Growth: The one thing that matters

For startups, there’s just one currency — growth. The reason you start a business is to disrupt a market. If you’re crawling, you’re kidding yourself; you’re not disrupting anyone. Growth doesn’t always mean revenue. It depends on your business model. You might concentrate on users (like we did at Plaxo) or a specific engagement metric (e.g., tweets or payments processed). But you need to pick one and drive it.

Early stage ventures

You’re measuring weekly and monthly growth. And if you’re not on a 2–3x annual trajectory (1–2% per week), you need to find something else to do. Paul Graham’s post is a good place to start.

Later stages

Target at least 50% annual growth minimum. That’s 0.8% per week. If you’re falling below 0.4% per week or 20–30% per year, it’s time to work on Plan B.

Tom Tunguz (Redpoint), David Skok (Matrix Partners) and the Pacific Crest SaaS Survey are all good sources of SaaS venture benchmarks.

When the $#!† hits the fan

You will probably run into the reality check and Trough of Sorrow when growth cools. We ran into it just like most other ventures.

The problem could be product-market fit. In our case, it was a go-to-market strategy that was pulling us away from customers. And that’s what I set out to fix.

Growth Playbook

Redbooth was a special SaaS startup. But it didn’t have a history of strong operational discipline. It wasn’t managed by the numbers. In fact, there were many numbers the team didn’t know and couldn’t manage. And because it was blind, previous growth efforts had only mushroomed costs. We had to build the playbook from the ground up.

Step One: Establish metrics and dashboards

Track it, tune it, drive it. You need the foundation of metrics and objectives. I’ve written a story about our dashboards and open sourced a spreadsheet dashboard. To make it work, you need good data on your subscriptions and your marketing funnel.

We used Zuora and analyzed the MRR Momentum extract. Other services like SaaSMetrics and ChartMogul can provide subscription data too.

You have no excuse for anything aside from real-time funnel metrics.

We tuned up our funnel data and created thermometer/progress charts of key metrics. We used Chartio to link data from Google Analytics and our own Redshift data warehouse.

An example of real-time funnel metric reporting — know where you are at any time

Review your dashboards in your weekly management team meeting and share your progress broadly. We made the dashboards available to anyone on the team who could log into Chartio.

Step Two: Get real about your go-to-market

In 2014, we were in the 90th percentile of startup growth rates. By 2016, when I took over, we were in the 10th. Worse, our unit economics were completely out of whack. CAC Payback had ballooned to 8 years and Customer LTV was a fraction of CAC. At the root, we had a go-to-market strategy that didn’t fit our customers. We had arrived in No Man’s Land — the land of broken startups.

Our mission was to get to the Turkey Shoot

We knew that we needed to start with a fundamental change. These articles can help you assess and optimize your venture’s go-to-market strategy too.

…targeting SMBs with anything more than a self-service model is not sustainable business.
There’s no silver bullet, but the closest thing to a silver bullet is inbound marketing — besides having a fantastic product with a very high NPS (net promoter score) and being obsessively focused on funnel optimization.

For us, the message was clear. To grow our SMB customers, we needed a self-serve/no-touch model. We tested sales touch and self-serve side by side. The results were rapid and conclusive. Self-serve was more effective than inside sales at a fraction of the cost. We shifted completely from inside sales to no-touch as quickly as possible.

Step Three: Test, test, test

The shift proved we could transform Sales & Marketing, but it wasn’t enough on its own. We needed continuous optimization of the funnel to reignite growth.

We weekly Growth Team meetings and experimented with quarterly planning. At the end of the day, a simple spreadsheet and some discipline do the job.

Here’s a version of our spreadsheet to organize your experiments (which you can freely copy and use).

Think critically about your marketing funnel. Get to know the benchmarks. Prioritize ruthlessly. Keep driving to your weekly growth objective. And be sure to share your progress and learnings with the whole team.

Step Four: Hit the afterburners

We made dramatic strides but still hadn’t met our goal. Something was holding us back. The final step was tuning team performance — matching the right skills with our needs. During my time as COO and CEO, we turned over the entire marketing and sales team.

Afterburning is a tricky thing. It helps a supersonic jet to achieve a burst of thrust, usually for combat. It injects fuel into the jet pipe after the turbine for maximum thrust. But it’s only acceptable for short periods, since it consumes so much fuel.

There’s no perfect rule for when you change your team. And it’s all too easy to say “Don’t wait too long.” or “You should have acted sooner.” Either way, be careful when you use the afterburners. And hold yourself to the highest standards of conduct.

To grow, we needed to change. Changing the team was a critical ingredient to our success.


The plan paid off with dramatic results. By the end of June 2017, we had reignited growth with a lean, efficient engine.

Signups were back — growing over 2.4% per week (over 3x per year and 3x our goal). We had beaten our goals for a seven-year-old startup. And we had proven that growth wasn’t like Humpty Dumpty; it could be rebuilt.

The engine was incredibly efficient — with over 6x better CAC Payback! We were recovering our Customer Acquisition Costs within 15 months. We had beaten the median and were continuing to make it more capital-efficient.

The engine fit our customers — with over 10x better Unit Economics! We achieved a 2–3 LTV:CAC ratio and were on track to exceed the benchmark.

We had reignited Redbooth’s growth. And we had done it in a sustainable, efficient way. We learned and tuned this transformational process. And we learned the importance of having the right team in place to iterate at startup speed. In the end, our transformation enabled a great outcome for Redbooth. Merging with another growth company to transform the way people work.

Jon Sonnenschein has been leading product and operations for startups for over 15 years with four successful exits. Jon became the Chief Operating Officer of Redbooth in 2016 and CEO in 2017. Jon earned an MBA in Marketing and Management Strategy from The Kellogg School of Management and a BA with Distinction in Economics from The University of Michigan.