Startup First Hires: When and Whom to Hire for Customer Success Roles
One of the most important decisions for an early-stage startup is when and whom to hire for certain roles. It is no secret that people who thrive at early-stage startups are different from the ones who perform best in large corporations, so going through the first hires can get tricky. In the next few weeks, we will be meeting with early employees holding specialized roles at startups, and talk about what skills and backgrounds are needed for specific roles, and when to make first hires.
We kick off the series with a fireside chat with Kelly Hook, Head of Customer Success at Orderful, an a16z-backed supply chain startup based in San Francisco. Prior to Orderful, she held leadership roles at ConsenSys, IBM Watson, and as the Head of Communications for Prezi.
The origin of Customer Success (CS) concept
The traditional definition of Customer Success is different from account management which is usually more focused on, and measured by, account growth. Customer Success has some overlap on account growth but the metrics emphasis is more closely tied to customer goals. CS team’s are trusted advisors that help the customer get as much value from the product as possible.
Customer Success as a function was born from the rise of SaaS companies, where customers pay a subscription to access software. Unlike a more traditional enterprise model, SaaS customers often pay monthly or annually for the value of a product, which makes the potential for churn and revenue loss more difficult to forecast. Kind of like a landlord and renter situation. Customer Success plays an important role by continually observing and caring about the customer’s experience with an eye on fast time-to-value, churn prevention, and growth.
Hiring a successful Customer Success leader and team
When to hire a Customer Success person/team?
Everyone will have a different opinion on this. Some people will say that CS should be one of your first five hires, while others might say wait until you reach a certain ARR (Annual Recurring Revenue) target, like $1M under management. “ I would be as scrappy as possible for as long as possible, which ideally ensures the founders and the company are deeply connected to customer feedback and pain points. Once the size of accounts and/or number of customers become too difficult to manage, or you see that on the near horizon, it’s a good time to look for a CS person. Some signs you might need your first CS player/coach hire would be if you can’t respond to customer escalations quickly, you’re not speaking to top tier accounts, customers are leaving and you don’t know why, senior executives are handling the minutia on all accounts, product feels disconnected from customers, etc.,” says Kelly.
Who to hire as a Customer Success person/team?
Speaking from experience, you can hire someone who already has CS expertise, but you can also consider someone without CS experience who has relevant, transferable skills. Both approaches have benefits and challenges, and they depend on your company size, type of business, and objectives. Someone who has been in CS for a long time will undoubtedly bring valuable expertise to your company and can hit the ground running, but they also might have to adjust to the uniqueness of your company and determine if the models that worked before really apply in the new environment. Conversely, someone new to CS will have to ramp up on the CS industry but may approach the practice development at your company with more tailored perspectives.
In many cases, your product may not require high-touch activity from customer success on the majority of accounts, such as regular calls, guided onboarding, Executive Business Reviews, etc. This is especially true with B2C at scale. In this case, CS activities and the right hire may include a lot more data analytics where you’re looking for trends, usage patterns, etc in order to identify opportunities for optimization, growth and churn prevention. That said, I’m always going to be a fan of injecting the human element from CS when appropriate, even if your product is low-touch B2C.
What background should a Customer Success person have?
Customer Success is a very new field, most people hypothesize it began in the early 2000s as a result of SaaS companies taking off. It’s really only begun gaining serious traction here in more recent years. Therefore, many people have come into this industry from other areas of business. “I originally joined Orderful to focus on Enterprise accounts before having the opportunity to build out a Customer Success function. I did not have a traditional CS background which had benefits and challenges. Fortunately, Customer Success is full of kind, empathetic individuals you can lean on and learn from. If you’re a CS leader or a CSM, check out Gain.Grow.Retain to meet other individuals you can connect with to learn and exchange ideas. The CS role also employs a lot of core competencies from business development, public relations, product, and operational roles. Skills like effective communications and crisis management, data analysis, project management, client relations, strategic planning, etc are certainly transferrable”, says Kelly.
When determining the right fit for your first CS hire, it depends on what type of team you have in place and what type of skills you are trying to balance. Here are some optional things you might consider:
- Domain expertise can be a strong asset because those individuals can speak to customers about their business from a place of empathy and more easily notice opportunities for account growth.
- Business acumen will be valuable in most cases. Depending on which activities your CS team handles, there can be a significant amount of negotiation, billing discussions, and contracts. Additionally, the CS function will need to make churn predictions, report on customer health, and represent CS as a strategic business function.
- Being technically inclined and/or data-oriented is beneficial for almost every role nowadays. But in CS especially, analytical tools can empower your decision-making.
- Strategic thinking and problem-solving skills will help keep things in perspective and ensure company and customer goals are in balance. It’s critical that the right objectives are defined, meaningful feedback loops are created between the customer and other areas of the business, and a wide-range of unforeseen issues and topics can be effectively managed..
Customer Success as a cross-functional, collaborative role
Customer Success is focused on the customer achieving value. For this reason, the CS team works most closely with product, sales, and marketing. Engineering as well, of course, but we try to route customer feedback through product rather than direct to engineering.
“Our CS team at Orderful has four technical developers and domain experts. They are often the first ones to notice any product gaps, bugs, and areas where customers can have a more seamless, faster experience — they are shooting feedback to the product team on a daily basis. I feel strongly that the relationship and feedback loop between Product and CS teams are one of the most critical for positively impacting the company’s direction”, says Kelly.
The sales team is also a close partner. Customer Success is often involved in the late stage pre-sales cycle to listen for customer challenges, understand the deal, share the onboarding process with prospects, and define attainable success metrics. Since the CS team is primarily concerned with the customer achieving value, it is important to understand what was promised and set expectations — at the end of the day the company will have to deliver on this and customer satisfaction will be tied to ROI. Defining success metrics with your customer ensures you have something to measure against over time and provides a useful framework for EBR/QBRs down the road. Moreover, metrics keep parties accountable and reiterates the primary function of a Customer Success team as a trusted advisor.
“When it comes to marketing, at Orderful, CS is responsible for case studies and customer references. So we are always excited for customer advocates who are willing to share their before/after story and KPIs. We’re still building out our marketing function at Orderful and there will be a lot more collaboration around collateral and assets. ” As you can see, Customer Success is indeed a cross-functional, collaborative role.
The collaboration between startups and big corporates
Find the ideal customer profile for your SaaS product
“It has been a bit of a journey for us to truly know our ideal customer profile. Like many startups in the beginning, we strove to be everything to a wide range of customers. At first, we thought that we needed to reach all potential customers, not just those that could support the long-term vision. Soon though, we saw that the fastest adopters were more technical users, mainly developers, which is not a persona we were originally focused on. We adjusted our outreach strategy and the way we communicate roles and responsibilities around a successful implementation. Now we are certain on the profile of a successful customer for Orderful. Knowing our ICP and focusing on it creates happy customers and increased adoption. It’s important to concentrate on the prospects that will get the most value quickly and then grow from there,” says Kelly.
Show the value of your product as fast as you can
Your job is to make sure that your customer will have the best experience, and that they will get a return on their investment. “This is why honesty is the best policy during the sales cycle. Prospects see a demo of the product, we will answer any questions and resolve all concerns, but, if a customer is not interested in a modern self-service API approach to EDI, for instance, then ultimately we would not adjust to be something else. The best tip from me is to show them the value of your product as fast as you can”, says Kelly. “If they understand the vision and the benefits, it will be an excellent partnership.”
Lisa Enckell, Partner at Antler, says “It is okay to say “no” to your customers. If it’s not a good fit, don’t force it and move on. Entrepreneurs tend to iterate the product over and over again but sometimes, instead of iterating the product, it is worth to iterate the market. Your product can be perfect but you don’t realize it yet because you’re always talking to the same type of people.”
This is the first article of the Startup Skills series.
This article was written by Karolina Szweda, Global Marketing Assoociate at Antler.
Antler enables exceptional people to create exceptional companies. If you want to become a startup founder, find the perfect co-founder and create impactful companies to shape the future, apply now and begin your Antler journey.
