Tom Tunguz

DECEMBER 6, 2022

Post-Covid Metrics. Sales-lead teams cut headcount when account executives don’t attain numbers. As net income may become a more important metric for valuation, it may replace sales efficiency as a better metric for measuring bookings productivity. That explains nearly all of the delta in profitability. GTM Motion.

Headcount 344

Headcount Market Research Acquisition Education 344

SaaStr

JULY 31, 2020

Last year, the company doubled its headcount, tripled revenue and landed on G2’s Top 100 Global Software list. . Here are just some of the metrics: Cold calls have dropped 20% overall. 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

AUGUST 23, 2020

Massive headcount growth presages large software purchases and expansion. External signals are powerful proxy metrics. Whatever technique(s) you decide to use, I’d encourage you to think early about finding those proxy metrics for good prospects. A prospect experiences hypergrowth is perfect example.

Scale 267

Scale Headcount Sales Startup 267

SaaStr

SEPTEMBER 28, 2024

Appeal to every board member Recognize that non-founder board members often focus on surface-level metrics like logos and visually appealing pipeline presentations, while operators on boards tend to be more interested in concrete commit numbers and confidence in the sales funnel. Jason says, “There’s no bandaid in leadership.”

Technical Review 301

Technical Review Sales Hiring Sales Recruiting Revenue 301

Clouded Judgement

AUGUST 16, 2024

Today, IT budgets are roughly broken down into: ~50% headcount / personnel, ~25% software, ~15% hardware, and ~10% outsourcing / consultants. As software grows as a percentage, I think we see headcount / outsourcing shrinking. I created this subset to show companies where FCF is a relevant valuation metric.

Outsourcing Services 274

Outsourcing Services Cloud Software Outsourced Development 274

Tom Tunguz

JUNE 26, 2022

The difference is starkest in headcount: Coinbase employs more than 5,000 people while Uniswap counts fewer than 100. But revenue growth is more sensitive to market swings, the company discloses fewer operating metrics, and their token offers fewer rights than COIN stock. Centralized exchanges hold or custody user accounts.

Benchmarks 309

Benchmarks Headcount Government Business Model 309

SaaStr

AUGUST 21, 2024

Grew Restaurant Locations 29% Year-Over-Year to 120,000 Perhaps the most important metric at scale. Only Grew Sales & Marketing Expense 12%, and Cut R&D (Product + Engineering) and G&A Expenses Toast has gotten to profitability by truly holding the line on headcount and revenue expenses. Billion valuation.

Scale 304

Scale Payment Methods SaaS Payments Payment Solutions 304

Intercom, Inc.

NOVEMBER 14, 2018

Sales KPIs versus sales metrics: Is there a difference? Some might argue that there are fine-grained distinctions to be made between KPIs and metrics. You can think about it this way: your KPIs are the key metrics you use to measure sales performance. In my world, they’re just two sides of the same coin. Beware of headline KPIs.

Sales Hiring 188

Sales Hiring Metrics Revenue Sales 188

SaaStr

MARCH 20, 2024

Higher than he imagined in terms of the founder quality bar and, the stage of the business, and growth and efficiency metrics. There is less money to spend today, and even if you have money, there is so much more focus on efficiency metrics in addition to growth, and you might not be encouraged to spend it as you once were.

Sales Hiring 304

Sales Hiring Sales Recruiting Scale Headcount 304

Tom Tunguz

AUGUST 17, 2022

Employ Bill Binch’s Mojo Metric as a daily measure of pipeline health for the sales team. The mojo metric captures the net daily change in pipeline across new deals, expansions, & sales cycle changes. Perform a second order pipeline analysis to understand where pipeline deviations start. Pipeline is prologue.

Headcount 253

Headcount Engineering Trends Onboarding 253

SaaStr

FEBRUARY 14, 2024

Do we own the metrics and the people? We all become new customer-oriented, so we say we’re focused on the existing base, but once the sales team becomes 30-40% of headcount, it tends to dominate every conversation. There were some data points in the study around engagement being a big metric for CSM, but that might not be right.

Customer Success 302

Customer Success Sales Hiring Scale Headcount 302

SaaStr

SEPTEMBER 17, 2021

Vimeo just hired their first sales rep 3 years ago to spearhead $20k+ deals … and now they have 100 reps, and are on track to double that headcount. Anjali viewed this as a core place to drive up their metrics, with self-serve converting at half the rate to paid outside the U.S. My Top 10 Learnings: #1. This was interesting.

Enterprise 302

Enterprise Scale Sales Hiring Headcount 302

SaaStr

AUGUST 9, 2024

Headcount isn’t the right story for them, though. Eventually, this team moved out of growth, so their success wasn’t dependent on budget or headcount. Do you want a system that automates playbooks, presents usage data to the team, or creates and tracks a health score? Just like hiring, you don’t want to be lazy here.

Scale 294

Scale Sales Hiring Scaling Startup 294

SaaStr

APRIL 3, 2021

There’s a metric the very top founders track quitely, but ruthlessly, that I find other founders either don’t track, or sort of hide from. If nothing else, you can pretty reliability track headcount growth on LinkedIn). That’s % of marketshare. And importantly, if it’s growing, or shrinking. Why does it matter?

Azure 245

Azure Headcount AWS Education 245

SaaStr

APRIL 20, 2022

But they need the headcount to grow this quickly. #8. They engage once they see metrics that cross a certain threshold: “This is often done with free credits or in a pay-as-you-go model that lets them start quickly and with low risk. This is pretty standard for high-growth Cloud companies, although not terribly efficient.

Scale 62

Scale Cloud Headcount Scaling 62

SaaStr

OCTOBER 20, 2020

A lot of mature SaaS companies use the metric of ~$2m in ARR per customer success rep. No headcount limits. More than pays for herself, again. Great Customer Success Managers Can Be Accretive Managing Just $800k-$1m in Existing ARR Within 9-12 Months. I didn’t figure this out until $4m in ARR. No budgets. And hence, accretive.

Sales Hiring 343

Sales Hiring Headcount Engineering Banking 343

SaaStr

JULY 20, 2022

While these aren’t great metrics if Weave was enterprise, they are still solid for SMBs. Fairly low revenue per headcount, although being headquartered in Utah with a large presence in India does seem to bring costs down. #7. It’s a tough outcome for a team that is working hard to scale well into the nine figures of ARR.

SaaS Payments 287

SaaS Payments Scale Payment Methods SMB 287

SaaStr

AUGUST 13, 2021

A Fully Baked Financial Model — Including Crystal-Clear MRR and Operating Metrics. You need a baked financial model, that includes sales and marketing costs, scaling over time, headcount, and comparison to comps, and when you’ll need the next round(s). And no crazy aggregated quarterly metrics. Bookings second.

Scale 296

Scale Sales Hiring Venture Capital Headcount 296

The Angel VC

MARCH 23, 2016

If you have a SaaS startup with a higher-touch sales model where revenue growth is largely driven by sales headcount, the plan needs to be modified accordingly. With the exception of the VP of Sales role, sales staff headcount planning is done on the separate "Sales Team Hiring Plan" tab (re-using a model that I've built for this post ).

SaaS Payments 217

SaaS Payments Headcount SaaS Payment Methods 217

Intercom, Inc.

JULY 28, 2021

On top of that, bottom-line business metrics like customer retention and expansion are in focus for support teams now more than ever. Support leaders looking to expand their support offering will often seek to answer questions like “How can I scale my support without increasing headcount or budget?”

Headcount 239

Headcount Customer Support Scaling Mobile 239

SaaStr

MARCH 20, 2023

Some define it by headcount, typically around 200-2000 employees, and others by revenue, generally $10M to $1B annual recurring revenue. In rapidly growing companies, the headcount can go from 500-3000 in a matter of months. What metric is this company trying to move by buying your software? They’ll think it’s them.

Scale 243

Scale Enterprise Scaling SMB 243

Sales Hacker

JULY 24, 2018

Decreased revenue per rep, High turnover as you scale headcount. We made our machine more efficient even as we scaled, grew headcount, and skyrocketed our revenue. In the first six months of the year, our team’s headcount grew by almost 60%, yet our revenue outpaced that, growing by 142%.

Scale 78

Scale Headcount Sales Hiring Scaling 78

SaaStr

JANUARY 2, 2021

Your sales headcount. If 20% of your revenue is Smaller customers, 50% Medium, and 30% Large (a not uncommon scenario), align your energy and efforts proportionately. Align your marketing budgets. Your product / dev budgets. Don’t chase “whales” and big deals IF that’s not your core. It’s just going to distract everyone now.

Sales Hiring 310

Sales Hiring Headcount Pricing Market Segmentation 310

SaaStr

DECEMBER 19, 2022

Lots of SaaS founders are preoccupied with employee headcount as an important growth metric, but this indicator is not always true. What does successful company growth look like? Everyone is constantly questioning the value of what they’re doing because no one has time for busy work.

Compensation 262

Compensation Leadership Company Culture Headcount 262

Tom Tunguz

FEBRUARY 13, 2023

Turning to our customer metrics in the fourth quarter. As Google also reported, usage-based pricing models may weather downturns betterbecause the products they meter grow irrespective of headcount growth, a positive sign for infrastructure. From a geographic perspective, the U.S.

Cloud 243

Cloud Azure Headcount Software Review 243

SaaStr

JULY 24, 2023

High NRR is magical, but NRR as a metric isn’t a GAAP metric. They kept the headcount kind of flat. Efficiency is a complicated metric, and Mongo isn’t wildly efficient, even at $1.5B 5 — The Average Customer Spend More Than Doubles After Two Years. It can be gamed a bit and is subject to interpretation. Revenue growth.

Revenue 245

Revenue Scale Sales Hiring Cloud 245

Intercom, Inc.

JULY 14, 2020

Maintaining a 100% real-time experience typically requires: Increasing headcount to keep pace with a growing customer base and their conversations. And if you don’t increase headcount, you risk burning your team out. Rate of automated resolution (ROAR) , which is a metric that I’ve designed internally.

Headcount 224

Headcount Retention Customer Support Scaling 224

ChurnZero

JUNE 9, 2023

Good sales teams typically get the budget, headcount and tools they desire because the function is tied to revenue. As a result, CS teams often have to work harder to make the case for headcount, technology and even product requests on behalf of customers. To that end, here are the metrics you can use to get started.

Finance 98

Finance Metrics Customer Success Headcount 98

SaaStr

NOVEMBER 27, 2021

You’ll find that most SaaS companies at scale use a rough metric of 1 Customer Success Manager for every $2m in ARR. At $2m in ARR, budget $200k in headcount for the CSM positions + support. Tie bonuses and comp to success on both metrics (favor, in most cases, pure retention first, and additional revenue second).

Sales Hiring 246

Sales Hiring Customer Success Scale Customer Lifetime Value 246

SaaStr

NOVEMBER 27, 2021

You’ll find that most SaaS companies at scale use a rough metric of 1 Customer Success Manager for every $2m in ARR. At $2m in ARR, budget $200k in headcount for the CSM positions + support. Tie bonuses and comp to success on both metrics (favor, in most cases, pure retention first, and additional revenue second).

Sales Hiring 245

Sales Hiring Customer Success Scale Customer Lifetime Value 245

Intercom, Inc.

JUNE 1, 2021

Over the past year, many support teams have struggled with budget cuts, reduced headcount, and less bandwidth – while the volume and complexity of customer queries has only risen. So how can you manage a larger volume of queries without needing to add headcount? Challenge #1: Limited team bandwidth, resources, and budget.

Underperforming Technical Team 232

Underperforming Technical Team Technical Review Scale Headcount 232

SaaStr

MARCH 19, 2024

1: Capital As an operator, your job is to take money and add headcount and programs to drive the growth engine for your company, You might think of capital as fundraising and budget. As an operator, you’re mostly thinking about your need for your function in isolation — what you need to achieve the goal or metrics assigned to your team.

Headcount 281

Headcount Scaling Finance Engineering 281

InsightSquared

MAY 7, 2019

For these reasons, accurately tracking key sales metrics and benchmarking your performance against peers and market leaders is critical to getting the most out of your sales resources. Typical SaaS Sales Metrics. Underlying those metrics are processes which can improve or reduce performance in each of the above metrics.

Scale 102

Scale Sales Hiring Metrics Sales 102

SaaStr

OCTOBER 18, 2019

Actual GAAP revenue, real recognized revenue is, has, and always will be, your primary metric. With precise headcount and budget needs. You can try and hide this “issue” by talking about bookings instead of ARR. But that’s for suckers. That, and of course, someday, profits. The Good News: It’s Not Too Late for Next Year. How many reps.

Sales Hiring 242

Sales Hiring Scale Headcount Revenue 242

SaaStr

SEPTEMBER 19, 2021

With precise headcount and budget needs. I’ll Keep it Simple. I just want you to find a way to do 5 things: First, it’s time to build a real financial and operating model for next year — NOW. Pick a real ARR target for the end of next year, and back into who you’ll need to hit it — month-by-month.

Sales Hiring 287

Sales Hiring Scale Headcount Acquisition 287

SaaStr

MARCH 15, 2024

The two of them together own their metrics, and on free, it’s 100% MAU. A piece of tactical advice from Adam is to have fewer metrics, not more. The first thing Adam did when he showed up was remove 80% of the metrics. Do you see massive disruption in workforces and marketing headcounts shrinking because of AI? “I’m

AI Search 276

AI Search SaaS Advertising Sales Hiring 276

SaaStr

JANUARY 12, 2024

SaaStr CEO Jason Lemkin also wrote how Customer Success has now morphed into part of the sales team and that the 2024 trends in CS include everyone wanting to eliminate humans from support to replace that headcount with AI and bots. The world has changed. We still want to drive retention and growth and make money. There’s a lot of nuance.

Sales Hiring 321

Sales Hiring Customer Success Scale AI 321