Lessons learned pursuing product-led growth (1 of 2)
Product-led growth (PLG) is the latest buzz in B2B SaaS today. Lots of successful companies have grown from this model, including SmartSheet, Datadog, and Calendly. But deciding whether this model works for your startup, or whether you need to pivot your business to PLG, is not an obvious decision.
PLG is is a go-to-market (GTM) strategy in which user acquisition, expansion, conversion, and retention are all driven primarily by the product.
To give some context, my background is in B2B product management for SaaS cybersecurity products. For those in the cybersecurity space, a majority of companies follow a “traditional” GTM model: Request a Demo, run a Proof-of-Value (PoV), closed won. This model is not limited to just cybersecurity; other large enterprise software vendors follow this model as it’s worked in the past, and gives the vendor more control over the evaluation experience.
But with PLG, startups are putting established software vendors to the test. PLG flips traditional GTM models on it’s head and gives power to end-users to freely use the software without a “chaperone experience” via a sales person. Cybersecurity is starting to see this emerge, especially as cloud technologies shift the power to developers and away from on-premise operations.
In the past few years, I had the opportunity to join a startup and be the lead Product Manager for a new cloud & security product. Our main persona was an engineer — which meant launching the product initially as a Free Trial. Thus, we made the decision to start our GTM model with a PLG-motion.
We realized that despite a bunch of signups and trials, we were getting very little face-to-face contact with the end users. In retrospect, this makes a bunch of sense — they were running with the software, but ignoring our sales emails and phone calls. (I mean, what engineer will actually want to speak with a sales rep?) The critical feedback loop that we needed for our early product was missing. We measured in-product clicks, usage, integrations, etc. — but we were still missing the big story of “what problem are our best users trying to solve with our product”?
Converting our Free Trials into sales opportunities our team could run wasn’t easy. It required mapping the customer account and finding the buyer — e.g., these were interesting leads, but not “fast moving” pipeline. We faced a cross-road situation: Do we double-down on the PLG motion with a growth-oriented R&D team and hope for a different outcome? Or do we completely redesign our GTM model to get more feedback?
