Tom Tunguz

DECEMBER 13, 2022

So, did headcount at the Series A. In 11 years, the median headcount at Series A swelled from 15 to 28. [1]. 1] Thank you to the Pitchbook team for running the headcount analysis data. [2] More capital meant the constraints of yester-decade no longer applied. Founders declared a maximum acceptable dilution instead.

Headcount 305

Headcount Venture Capital Finance Startup 305

SaaStr

SEPTEMBER 21, 2023

That works for a while, but you end up with not enough headcount if you do freeze hiring but still want to grow. More on this in our deep dive with co-CEO Eran Zinman: You can’t grow forever with no growth in headcount. But we’re lapping tougher times for many, and for many others, it’s just plain time to hire again.

Sales Hiring 328

Sales Hiring Headcount Scale Cloud 328

Tom Tunguz

MAY 16, 2023

I analyzed the headcount patterns within these companies to shed light on three questions : How are these top companies changing their headcount through the downturn? What percent of headcount is in product & engineering? What percent of headcount is in sales & marketing? The typical company grew headcount by 57%.

Headcount 257

Headcount Startup Scale Engineering 257

Tom Tunguz

APRIL 5, 2020

But starting that week, startups began reducing headcount by about 700 per day. ClassPass, one of the fitness startups to reduce headcount, reported a 95% drop in sales in 10 days. Over the weekend, I analyzed Roger’s data to answer this question. First, let’s look at layoffs by day. Friday spike to more than 1800.

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Sales Recruiting Startup Headcount Sales Hiring 314

SaaStr

MAY 29, 2024

Growing Headcount and Expenses, Just More Slowly Than Revenue The story for most SaaS and Cloud leaders. Grow headcount and expenses, but more slowly than bookings. #5. UiPath proves it again. #3. 1M+ ACV Customers Growing The Fastest UiPath at $1B+ ARR is a tale of going … even more enterprise. $1M+

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Scale Headcount Sales Hiring AI 288

SaaStr

MAY 30, 2023

And very few of you are doubling headcount, vs everyone in 2021. Hiring has way slowed down, but many folks are still hiring, albeit at a reduced rate. 56% of you aren’t hiring, or barely hiring. But a good chunk of you are still hiring, albeit in moderation. This is what we are starting to see across public SaaS leaders as well.

Sales Hiring 277

Sales Hiring Headcount Engineering Revenue 277

SaaStr

SEPTEMBER 19, 2023

Some of the changes we’ve seen in the last year or two include: CAC reduction Headcount optimization Price complexity Quality of revenue A different environment means a different strategy, and Notion Capital lays out four business model changes that could be helpful based on what peers are doing. You don’t want to be there.

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Business Model SaaS Payments Payments Headcount 304

SaaStr

MAY 12, 2021

But in theory, higher quotas should “pay” for specialization so in theory, this won’t impact headcount too much. But in practice it often adds 20% or so to the headcount in the model. Fifth, the more specialized the sales process is, the more folks you’ll need. SDRs, BDRs, etc. 2 Managers. = 22 heads /.75

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Scale Sales Hiring Headcount Sales 317

SaaStr

AUGUST 16, 2021

“Adding headcount in customer success dept” — Hoala Greevy, CEO, PauBox. You can’t cut corners in headcount in success with automation. You just make the headcount more effective. MaestroQA has driven its ACVs up substantially, but that doesn’t always mean charging more for everything.

Churn 328

Churn Sales Hiring Headcount Technical Review 328

SaaStr

JANUARY 4, 2023

Slowing headcount growth — like lots of others. Okta headcount grew 32% year-over-year, fairly consistent with revenue growth, but then Okta like others slowed down hiring. Okta is seeing higher SMB churn and more ROI scrutiny, but is also benefitting from some customers wanting to centralize on fewer core vendors.

Scale 317

Scale Headcount Sales Hiring SMB 317

SaaStr

NOVEMBER 16, 2022

Like many tech companies, Monday added a ton of headcount in 2021. It then added only 63 employees last quarter, and plans to continue with very slow headcount for a while. Another reminder to go global in SaaS as early as you can! #10. Slowing hiring has been key to driving up free cash flow.

Headcount 321

Headcount SMB Engineering Scaling 321

SaaStr

APRIL 7, 2024

Unlike building a product team, there is no efficiency when building a sales org: half of your headcount will be in sales at $10m, $50m, or $100m in revenue. It’s tough for founders to grok 40%+ of their headcount forever may be in sales. Add more structure here, and everything gets better. #6.

Sales Hiring 310

Sales Hiring Scale Headcount Sales 310

SaaStr

MAY 10, 2023

At the end of the day, in SaaS, efficiency really comes from growing revenue faster than headcount. Almost everyone is doing more with … yes, more headcount, but only a smidge more. Revenue Up 30%, but Employee Count Only up 10%, to 7,055. Salaries and comp are the vast majority of expenses. Including HubSpot. #4.

Scale 316

Scale SMB Headcount New CTO 316

SaaStr

AUGUST 23, 2024

Once a VP of Sales that is struggling starts pushing for a lot more sales headcount … it’s time to realize it’s not working. In fact, fewer sales reps often in the short term solves the problem. You focus leads and opportunities on the best reps, and then rebuild the sales team from there.

Sales Hiring 295

Sales Hiring Headcount Sales 295

Tom Tunguz

JUNE 20, 2020

We can derive the table above if we look over the entire respondent base and bucket headcount by ARR. This post is part of a series leading up to SaaS Office GTM Edition on June 24 in which we’re reviewing the results of the 2020 Redpoint GTM survey. Today, we’re answering the question: how do teams grow as a startup scales?

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Scale Scaling Sales Hiring Software Review 346

Tom Tunguz

MARCH 27, 2023

The antidote: greater pipeline-to-quota coverage ratios by either increasing the top of the funnel or reducing the account executive headcount. These benchmarks suggest startups should plan on materially longer sales cycles into 2023. The data analysis uses the results from the 2023 GTM Survey.

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Startup SMB Headcount Sales 311

SaaStr

MAY 31, 2023

Everyone is basically doing more with not much more headcount (see next point). #4. Growing Headcount, But Much More Slowly That Revenue. Headcount is up 29% year-over-year, but revenue is up 50%. Also you can see sales & marketing headcount is basically flat, while hiring is almost all in engineering / R&D.

Headcount 243

Headcount Scale Sales Hiring AWS 243

SaaStr

NOVEMBER 22, 2023

Freezing Headcount is How They Got So Much More Efficient Again, a common story. But for now, AppFolio is staying leaner, with less headcount this year than last — despite impressive +29% growth. #4. Many that did are now re-hiring, from Monday to Salesforce and more.

Payment Services 288

Payment Services Payment Solutions SaaS Payments Payments 288

SaaStr

AUGUST 18, 2023

Yes many public SaaS companies have done some sort of layoffs the past 12 months, they were often more really reorgs, though, without any net decrease in headcount. The key was “simply” keeping headcount flat. #3. Everyone is basically doing more with not much more headcount. Without really sacrificing growth.

Scale 242

Scale Headcount Point of Sale SaaS 242

Tom Tunguz

AUGUST 2, 2023

If a startup raised a top quartile Seed round, Series A, B, & C, they typically would have grown headcount by about 6% in the last twelve months. The headcount growth rate for all other companies? No statistically significant difference in headcount. Why look at headcount growth? About double at 12%.

Headcount 212

Headcount Startup AI Scaling 212

SaaStr

JUNE 4, 2022

You start making up for it in volume — with headcount. Your life becomes all about recruiting, even more than it was. It’s harder to find that Magical VP that can make a huge difference. At $100m+ in ARR, the hardest part is you have to add a Unicorn each year.

SaaS 351

SaaS Headcount AWS Churn 351

SaaStr

JUNE 25, 2024

Fund sizes shrinking = headcount reductions. Funds just plain got bigger over the past 10 years, and in many cases, the original GPs and Old Guard aren’t 100% ready to hand over economics and control. It’s complicated. Not everywhere, but in just enough places so you can see it and feel it.

Headcount 260

Headcount Trends 260

SaaStr

JULY 31, 2020

Last year, the company doubled its headcount, tripled revenue and landed on G2’s Top 100 Global Software list. . And some of the marquee customers include MongoDB, Gitlab and Qualtrics. . The funding comes at a point when Chorus is in the hypergrowth mode.

Scale 359

Scale Artificial Intelligence Payments Payment Services 359

Tom Tunguz

JUNE 1, 2023

1 BDRs are often mapped to AEs at 1:1 ratio & if we assume BDRs account for 25% of sales headcount (the remainder includes AE, sales operations, post-sales, & management). Assume a 15% productivity improvement that results in a 1.5% improvement across the company.

AI 317

AI Startup Scale Headcount 317

SaaStr

NOVEMBER 15, 2020

Hence, Twilio has a very high level of sales efficiency (and relatively small headcount). Many of Twilio’s bigger customers go through sales, but then a huge amount of the downstream revenue is “automatic” as customers use more. But there’s still a real sales team there. They just only need to directly touch a subset of the total revenue.

Scale 342

Scale Sales Hiring Sales Headcount 342

SaaStr

DECEMBER 19, 2024

And personally, while I’m still in learning mode for AI, I’m not betting on any net reduction in sales headcount from AI. In different ways, at different places. But in most places. Salesforce included. I haven’t seen it yet, and don’t expect to see it.

Sales Hiring 207

Sales Hiring AI Headcount Sales 207

SaaStr

JULY 25, 2021

But in theory, higher quotas should “pay” for specialization so in theory, this won’t impact headcount too much. Fifth, the more specialized the sales process is, the more folks you’ll need. SDRs, BDRs, etc. But in practice it often adds 20% or so oto the model. 4 SDRs to screen the deals. 2 Managers. = 22 heads /.75

Scale 306

Scale Sales Hiring Sales Headcount 306

SaaStr

MAY 26, 2022

Net headcount rarely declines. This may sound harsh, But any "layoff" of a single digit % of employees is usually just a reshuffling. The bottom 5%-7% are moved out, to replace them with better performers. — Jason BeKind Lemkin #???????????? jasonlk) May 25, 2022. Layoffs sound scary, and they are scary.

Headcount 306

Headcount Scaling SaaS Management 306

SaaStr

MARCH 8, 2023

Don’t Tie Revenue To Headcount “You want to get away from a business model where every incremental dollar requires incremental hiring,” says Deatsch. So instead of focusing on scaling headcount quickly, work toward growing revenue quickly.

Sales Hiring 263

Sales Hiring Enterprise Headcount Scale 263

SaaStr

MARCH 1, 2022

Headcount up 7%, while revenue is up 37%. But that only increases total headcount 7% which revenues went up 37%. That transition doesn’t happen overnight for legacy customers. 30% of their revenues are still from customers running Jira and friends on their own servers. But it’s now finally in decline, shrinking 12%. #5.

Scale 262

Scale Marketplace as a Service Headcount Cloud 262

SaaStr

SEPTEMBER 30, 2024

But it’s already starting in the contact center, where leaders from Zendesk to Gorgias to Intercom to Talkdesk are automating away 30%-50% of contact center headcount. Maybe, maybe not. All unstructured data to be instantly structured and searchable. Search was sleepy for years. Now, it’s front and center.

AI Search 302

AI Search SaaS Headcount AI 302

SaaStr

NOVEMBER 25, 2020

Hoping headcount (alone) will drive revenue. At some point, every SaaS company gets big enough where headcount does drive revenue. Don’t agree to a plan you mathematically can’t hit. This never ends well. You’ll be blamed. You’ll be fired. But this is almost never the case before $8m-$10m in ARR or so.

Sales Hiring 359

Sales Hiring Sales Recruiting Sales Headcount 359

SaaStr

MARCH 20, 2024

Do you have to double your headcount to make it from $10M to $20M or even $2M to $5M? For headcount specifically, make sure that the constraint to growing faster is that you don’t have enough salespeople to work the demand that exists for your business. When those outcomes are achieved, the hire gets their headcount.

Sales Hiring 305

Sales Hiring Sales Recruiting Scale Headcount 305

SaaStr

NOVEMBER 6, 2024

“And I think the budget comes from headcount,” Dave explains. As a line of business owner, if I want to do something, I can find the money from headcount.” ” If I want to pay for an AI SDR, I know where to get the money. ” Is Customer Success Dead, Now That it Reports to Sales?

Headcount 265

Headcount SaaS AI Pricing 265

SaaStr

AUGUST 1, 2023

But this time, instead of headcount, it was apps. Yes, some bigger companies went through layoffs too, but in many cases, they hired more folks back, and really just kept headcount flat or slowed its growth. You get all the VPs into a room, and you tell them to make a list. Of the 10% to cut. Apps though they truly cut.

Headcount 245

Headcount Finance Cloud Startup 245

Tom Tunguz

JANUARY 22, 2023

B2B companies have reduced headcount to a greater extent than at any time since 2020. The current wave of layoffs, a difficult component of the innovation boom/bust cycle, differs from the previous years’ dynamics. In the last three years, B2C startups’ ratio of layoffs have dwarfed B2B layoffs. In 2020, B2C companies cut 8.8x

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B2C B2B Headcount Business Model 273

SaaStr

JANUARY 30, 2024

They did layoffs and froze headcount. That they had to get to cash-flow positive, because no more money was coming. And while many couldn’t pull it off, and will go under, a lot actually got there. They cut marketing spend to $0. They raised prices. So now they are, in essence, NRR Zombies.

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Headcount Finance Startup Trends 291