Dave Gerhardt was VP Marketing at Drift, acquired for $1B, and then Privy, acquired for $100m, and now runs a great CMO/VPM community called Exit Five.
Dave is OG SaaStr from the beginning, so we were able to have a pretty epic deep dive on marketing today, both at a senior level and a deep dive on content marketing as well:
- Why marketing should almost never report to sales
- The critical size of marketing teams today
- How to do content marketing well, and see real ROI from it
- How to make sure you are hiring the right VP of Marketing
Intro
- Jason Lemkin emphasizes the need for dedicated and responsible individuals in marketing teams, highlighting the importance of community building and brand development.
- Lemkin expresses concern about the changing work ethic and loyalty of sales and marketing professionals, observing a trend of multiple job-holding and lack of commitment.
- The current economic climate demands recalibrated expectations from leaders, as many employees face job loss and difficulties in finding new employment.
- Revenue per employee has doubled since 2021, leading to budget cuts and the necessity for leaders to achieve more with fewer resources.
Understanding the Importance of Revenue Goals
- Jason expresses concerns about the high costs associated with producing a podcast and questions the return on investment if not done thoughtfully.
- Jason highlights the difficulty in finding qualified candidates for critical roles, such as an email marketer, despite offering a high salary.
- Lemkin emphasizes the need to hire “Pirates and Romantics,” passionate and quirky individuals who are dedicated to the company’s mission, in contrast to the majority of job workers in the tech industry.
- Lemkin acknowledges the challenge of meeting people’s high expectations and the existential nature of finding solutions to these hiring and motivation issues.
- The speaker reveals that he recently discovered the answer to what motivates him after a discussion with Aaron Levie, CEO of Box.
- The speaker’s motivations have evolved over time, but initially, he was driven by a desire for meaning and a sense of guilt about selling his previous startup too early.
- The speaker felt a personal responsibility to contribute to the world and address the shortcomings he perceived in the tech industry, leading to the creation of SaaStr.
Evolving Motivations and Changing Perspectives in Your Career
- Lemkin discusses conversations with successful CEOs like Aaron Levie of Box and Scott Farquar, of Atlassian, about their motivations for continuing their work despite achieving significant milestones.
- After achieving financial security through successful exits as CMO at Privy and VP of Marketing at Drift, Gerhardt experienced an existential crisis during the pandemic, questioning the importance of his work in the tech industry.
- Dave decided to pivot his business model from solopreneurship to building a sellable asset, leading to the creation of Exit 5.
- Jason Lemkin shares his experience of hiring and investing in his business, which has revitalized his passion for work and brought him renewed purpose and excitement.
- Lemkin emphasizes the satisfaction and enjoyment derived from the process of building something, even if it’s not world-changing.
From Solopreneur to Founder
- Builders need to build, and without building, they can experience depression.
- Solopreneurship can be alluring but has a toxic element, so it’s important to find joy in one’s current job before becoming a solopreneur.
- Tech workers often don’t understand that businesses need to make money, and the average cost of a tech employee per day is $250,000.
- It’s important to take a vacation and try to find joy in one’s job before moving on.
- Sometimes, it’s necessary to move on from a negative job or situation and focus on what you love.
The Challenge of Transitioning from Solopreneurship
- Solopreneurs may find it difficult to transition to working in a larger company.
- It’s important to find a company where you enjoy working with your colleagues.
- If you hate everyone you work with, it may be time to find a new company.
- In the early days of SaaS, blogging was a popular form of content creation.
- Today, people are less likely to type in a company’s website address directly.
- However, some of Jason Lemkin’s old blog posts from 7-8 years ago still receive traffic.
Insights into Jason’s Content Creation Process
- Jason updates his old blog posts by refreshing the content and sometimes reposting them.
- He believes that one of his superpowers is being able to write quickly and efficiently, as he can write in five minutes what would take others weeks.
- Jason also believes that his ability to distill complex information and make it actionable is another superpower that sets him apart.
Jason’s Superpowers
- Jason identifies two of his superpowers in content creation:
- The ability to write quickly and efficiently.
- The ability to distill complex information and make it actionable.
Efficiency in writing: a five-minute rule
- Effective content marketing should be based on genuine insights and learnings, not solely on polished writing.
- Select a content marketing format that aligns with your interests and strengths, such as podcasting, writing, or LinkedIn posts, and avoid forcing yourself to create content that doesn’t resonate with you.
- Plan and schedule your content in advance to maintain consistency and save time.
- Tailor your content format to the specific platform you’re using to cater to different audiences.
- Jason Lemkin prefers sharing his thoughts through LinkedIn posts rather than engaging in conversations, finding it more efficient for his communication style.
- Lemkin received advice from a podcast leader to improve the SaaStr podcast, but he opted against implementing the suggested changes as they felt unnatural and required substantial effort.
- Lemkin advises against spending excessive time on LinkedIn, as it can potentially send a negative signal to potential employers.
LinkedIn: A Haven for Text-Based WritersÂ
- LinkedIn is a powerful platform for sales and marketing professionals.
- The algorithm surfaces connections and reconnects people who might not otherwise connect.
- Many people in marketing and sales cross the line on LinkedIn, which can be detrimental to their personal brand.
- Jason Lemkin has interviewed some of the best founders on his podcast, SaaStr Annual.
- He approaches interviews with profound respect for the founders he interviews.
- He believes that he is good at interviewing founders because he is better at interviewing than they are.
- He compares his interviewing style to that of Mark Maron, who is a comedian and podcaster.
- He respects the founders he interviews more than he respects himself.
LinkedIn’s Good Community and Marketing Potential
- Jason Lemkin prefers to interview founders he knows personally for his podcast due to the challenges of finding guests.
- The role of a great VP of Marketing remains consistent: generating and nurturing leads through various marketing channels.
- Despite the rise of self-service in B2B, the marketing toolkit (targeted outbound, drip marketing, content marketing, webinars, events) remains effective.
- Events offer valuable opportunities for marketers to connect with customers, especially during the lockdown.
- Even small startups should build a marketing team as everyone needs support to achieve their goals.
- Early-stage startups often lack the budget for a large marketing team, and marketers unwilling to do hands-on work may not be suitable for these roles.
- Marketers should be self-aware and realistic about their willingness to do the necessary work in a startup environment.
- Hiring experienced marketers who are unwilling to do the work can be problematic for both the company and the individual.
- A marketing budget of $10 million or more is generally considered the point at which a company can afford to hire a CMO and build a larger marketing team.
Importance of Building Relationships in Business
- The role of a VP of Marketing in SaaS can vary depending on the company’s stage and budget, but they should have a budget of at least $10 million to generate as much pipeline as possible.
- When interviewing for a VP of Marketing position, it’s important to ask the right questions to ensure that the candidate’s skills and interests align with the company’s needs.
- A VP of Marketing should focus on two or three key areas where they can make the most impact, such as website, messaging, and branding.
- Hiring a VP of Marketing who is passionate about the company’s brand and creative strategies is crucial for long-term success.
- The CEO is always the Chief Marketing Officer (CMO), even if they don’t have the title.
Marketing Essentials: Brand, Field, Demand, Growth
- The most important thing for a VP of Marketing in SaaS is to be the CEO’s right-hand person and execute their vision.
- If the CEO is not the CMO, it is unlikely to be the right company for a VP of Marketing.
- Ask the CEO in an interview what their top three priorities are for marketing.
- If the CEO’s priorities do not align with the VP of Marketing’s skills and interests, it is best to move on.
- It is important to be confident enough to admit the things you are not good at.
Finding the Right Fit: Aligning Marketing Roles with Company Vision
- Aligning marketing roles with the company’s vision is crucial.
- Marketers do not want to work under a Chief Revenue Officer (CRO).
- Misalignment between sales and marketing can lead to conflicts over metrics and credit.
- Having marketing report to the CRO can lead to short-term focus, lack of control, and absence of yin and yang balance.
- When CS is part of sales, there’s a lack of focus on customer care.
- CEOs who are not interested in revenue and prioritize product development tend to hire CROs over CMOs.
- As a result, marketing, CS, onboarding, and other functions end up reporting to the CRO.
- This structure was common among unicorns in 2021, but capital masked the underlying issues.
- Controls and checks are necessary to ensure balance and prevent excessive focus on short-term revenue goals.
Finding Alignment: The Role of Marketing in Company Leadership
- The best VPs of Marketing in SaaS should own a delivery to sales metric and ensure someone cares about the customers, not just upselling.
- The CRO role has expanded and become disorganized, with the best sellers only wanting to close deals and not contribute in other areas.
- Marketing’s primary function is to generate and qualify leads, but they often resist this responsibility.
- Many companies are outsourcing more of their marketing functions because they find it challenging to manage effectively.
- In successful SaaS organizations, the sales, marketing, and post-sales heads all report directly to the CEO.
- CMOs should not report to the CEO in SaaS companies.
- Some CMOs or marketers mistakenly believe that sales is more glamorous and attempt to transition to the sales side, which is not advisable.
- AEs prefer to work for CROs rather than CMOs.
- A great VP of Marketing in SaaS should possess a deep understanding of both marketing and product.
- Avoid organizing events of any size when starting a SaaS company.
CROs and Marketing
- SaaStr Meetup in 2012 or 2013 had 800 attendees without an email list or content, showing product-market fit.
- Starting media companies or events requires a deep understanding of the challenges and complexities involved.
- Events can be profitable but require significant effort and resources, with many challenges and distractions.
- SaaStr’s success in events is due to its ability to organize high-quality events at scale, but it was not intentionally planned and could have been more strategic.
- Events should be kept small, focused, and not viewed primarily as a revenue stream due to the challenges involved.
- SaaStr now has 3,500 paying community members and media properties, generating over a million dollars in sponsorship revenue.
Balancing Heads: Sales, Marketing, and Post-Sales in SaaS Leadership
- Jason Lemkin discusses the importance of balancing sales, marketing, and post-sales in SaaS leadership.
- He emphasizes the need for Revenue leaders to network with Founders and attend events like SaaStr to meet potential customers and partners.
- SaaStr Europa will be held in London on June 4th to 5th, with an expected attendance of 3,500 people.
- SaaStr Annual will be held in the Bay Area from September 10th to 12th, with an expected attendance of 12,000 to 13,000 people.
- Jason Lemkin recommends that founders and revenue professionals attend SaaStr events to network with other industry professionals and learn from industry experts.
