Why, and When, You Need to Add BigCo Folks to Your Startup

So this is the time of year when someone on Team SaaStr quits.  Always.  Every year.

Why?  It’s because working on SaaStr Annual is just too big.  It turns out a 50 person event, you can just send out invites.  A 200 person event, you can hack.  It starts to get a bit expensive, but you don’t need any real experience.  Even an 800-1,000 person event, a larger events-focused hotel can handle most of the work for you.  A 2,000 person event?  That’s stressful, but you can find a somewhat turnkey venue.  2,000 is really hard, but you can still sort of wing it.

But after 2,000 people, it all breaks in events.  And SaaStr Annual is just too big and too complicated for anyone to work on that doesn’t have experience at scale.  No matter how much other experience they have.  They break when the event is looming and they just can’t manage all the complexity.

It’s a reminder the same is true of SaaS startups.

You absolutely need start-up people to start-up a start-up.  Folks that know startups, and what it takes to put those initial points on the board.  Know how to go from 10 to 100 customers.  How to do marketing without a team of 20.  How to go from 2 sales reps to 20.  You need folks that know how to survive and thrive in that environment.  Hire a BigCo VP much earlier than $10m ARR, they almost always fail.  They don’t know the playbook, let alone how to operate without a top-tier brand and a team of 10-20 under them.

But here’s the thing, the job from $1m-$10m, you can sort of hack it if you know the playbook.  You can hire 1 or 2 reps at a time.  You can try marketing programs sequentially.  You don’t have to be hyper-organized, or really how to manage budgets, or how to hire 10 reps at a time.  Or how to deploy $10m in marketing spend effectively.  Or how to build a 20 person CS team.

As you pass $10m ARR at least, you need to start to add VPs and leaders that know.  They know how to scale.

Some of your team will figure it out.  They’ll be tenacious, get help, and ultimately — and this is key — hire managers under them that are more experienced than they are.  This is really the only way most startup folks can really scale.  If they are self-aware enough, and confident enough, to hire managers under them that are more experienced than them.

If you can do that, you can scale infintiely.  But most start-up folks … can’t.  And don’t want to.  They are glorious hackers. And glorious hackers can take you to $5m-$10m ARR or so.  But after that, you have to add managers that can take your brand, and a bigger budget, and deploy it.

Either your first VPs have to hire the help that can really help them scale to do that.  Or you need to hire VPs above them (SVPs) that can.

You’ll see.

You may love your first set of VPs.  I hope you do.  And often, half of them find a way to scale past $10m ARR.  The ones that do though, always find a way to bring in folks under them as Directors that have scaled the next stage.  And scaled it well.

If nothing else, add one seasoned VP as you cross $10m ARR.  Then you’ll see.  More on that here:


Published on August 26, 2021

Pin It on Pinterest

Share This