Hopefully everyone is getting excited for SaaStr Annual 2022, Sep 13-15 in SF Bay Area!!
We recently had a great session at SaaStr Europa 2022 with the CEO of Payfit and the head of Accel Europe.
If a SaaS business hopes to win over the SMB market successfully, it will need a precise GTM approach. At the SaaStr Europa 2022 event, Accel Partner Philippe Botteri interviewed PayFit CEO & Co-Founder Firmin Zocchetto to ask about his GTM strategy.
Founded in 2015, PayFit is a software company that empowers entrepreneurs and SMBs to digitize payroll and HR processes. Boterri’s company Accel invested in PayFit in 2017 and again in 2021. As of 2022, Payfit has reached unicorn status –– after raising $289 million in Series E, the company is now valued at $2.1 billion. Currently, PayFit serves over 7,000 customers and shows no signs of slowing down.
So how did PayFit achieve such explosive growth? The answer lies in the GTM strategy and Zocchetto shares seven secrets that helped fuel PayFit’s success.
Secret 1: A Self-Serve Product is Non-Negotiable For SMBs.
From the very beginning, PayFit planned to create a self-serve product. They built their sales funnel in the same fashion to empower customers with autonomous product discovery and conversions. Yet, they needed to work out some challenges to support a fully independent journey (e.g., when customers needed to switch from an old payroll solution to PayFit). As a result, they’ve continued perfecting their marketing engine to support automatic or self-guided transitions to eliminate any final sticking points before a conversion.
Without an autonomous-first approach, you will miss out on many SMBs. Smaller organizations don’t typically respond to the long sales cycle or constant conversations and negotiations that an enterprise needs. If you approach an SMB with a heavily involved sales process, they will likely move on or go to your competitor. Regarding a small business prospect, Zocchetto said, “If you are looking at a product that [does not] have a self-serve funnel, you will probably just be ejected from the funnel, and the system won’t get you.” However, this does not mean that you should abandon sales teams. Zocchetto went on to say, “It’s not either sales [or] self-serve –– the two go together, which means that there will be some personas, some prospects that will be fully autonomous along the way. There will be prospects that do want a new solution but will never be autonomous.”
The self-serve approach goes beyond the sales cycle. Customers should feel empowered to take on onboarding and essential customer support themselves.
Secret 2: Be Prepared to Play the Volume Game When it Comes to Talent –– People Are Everything.
Sales teams play a critical role in growing a business. But your sales needs when selling to small and medium-sized businesses differ from an enterprise-level market. You need volume, not top expertise or the high salary price tag that comes with enterprise AEs.
At PayFit, they prioritize hiring junior talent hoping to grow their sales skills and ambitious to move up at the company. However, you should still be selective in choosing your talent pool, ensure there is room for growth at your company, and train your SMB reps very well.
Helpful Hint: Be sure you plan out how you plan to hire for sales early. As Zocchetto said, “It’s very important –– sales hiring planning –– because in a self-driven SaaS business model, it’s what drives growth.”
Secret 3: Don’t Underestimate the Importance of Culture. It’s the Glue Holding Your Company Together.
At PayFit, a healthy culture is key to fighting attrition and growing the business. One way to ensure that the culture continues to thrive is to hire suitable candidates who embody the company’s spirit.
One thing that helps PayFit know whether an applicant is a good fit is hosting informal social get-togethers with other team members. This way, the candidate can interact with potential co-workers and understand what company life might look like. And remember, keep the sales team culture happy to fight attrition.
Secret 4: Be Transparent About Pricing and Keep It Simple.
When it comes to pricing, some companies deliberately choose to keep it complex to make it easier to raise prices down the road. However, PayFit moved away from this strategy to offer straightforward pricing, and this is because they made a tactical decision to make an autonomous customer jorney easier and to appeal to the masses.
Zocchetto stresses that business leaders should not be worried about leaving money on the table with transparency in pricing. On the contrary, simple pricing attracts more self-serve business.
Secret 5: Build a B2C Rather Than a B2B Marketing Engine
When considering B2B versus B2C tactics, B2B is more about relationship building with longer sales cycles, while B2C leans toward building awareness and supporting independent buyer journeys. PayFit adopts a B2C strategy because it scales efforts to attract a higher volume than typical enterprise-geared tactics.
Secret 6: Customer Satisfaction Is Your First Lever For Growth.
It might seem that product is the first lever for growth, or possibly sales, but your customer satisfaction can make or break your business. On the subject, Zocchetto said, “I think on top of sales and marketing and a beautiful product…making your customers happy with what you are delivering to them is the most important lever for growth.”
Unhappy customers can kill your growth engine. But happy customers can not only expand your recurring revenue but also contribute to new conversions and acquisitions.
Secret 7: Get Your Foundations Right Before Going International –– Tools and Processes Are Vital
Before you start international expansion, get your internal tools and processes organized. Zocchetto shared a learning PayFit experienced early on: As PayFit began selling in global markets, they neglected to implement a CRM, creating many unnecessary complications for the business. It pays to get your ducks in a row before adding on extra layers of complexity.
- Support autonomous sales cycles, onboarding, and customer service as much as possible to optimize your reach in the SMB market.
- Plan your hiring strategy early, especially for your sales teams.
- Happy customers will be your most valuable asset in spurring growth.