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Nuances of Scaling B2B Startups Globally (Part 2)

Nuances of Scaling B2B Startups Globally (Part 2)

Shreyas Nair, the Chief Strategy Officer at Scale It Right and the second speaker at the November edition of GTMDialogues, learned about the SaaS market by working with US-based entrepreneurs who emphasised building a strong sales and marketing strategy. At ScaleItRight, he continues to help founders, regardless of their funding level, achieve their goals through effective sales campaigns with limited resources. 

In his presentation, he outlines a 9-step process to create the ultimate sales engine that delivers results:

  • The aim is to build a predictable scaling engine
  • Why do you exist?
  • TAM is for investors, AAM is for you
  • Demand generation vs demand capture
  • North America is not a market, it’s a mindset
  • Document everything, from start to finish
  • Execute 3 months at a time, heads down
  • Track every micro-activity for success
  • Deliverables + Impact

Hear him speak about his learning and experiences here:

Transcript:


Introduction [0:36 – 5:03]

I come from a slightly different world. I’ve been in the SaaS game even before I knew what SaaS meant as an acronym. So I’ll give you a bit of context around where I started and how. 

So about eight years ago there was a small little company based out of New York called Venture Pack. The founder said we need to create a lead magnet that works for us, and he ended up creating a calculator to calculate the cost of building a mobile app. We rolled it out on the internet just to find out that we generated 18,000 leads in a two-month time frame for the business. That’s when we realised that interactive marketing itself is a segment that can grow, that we can build it into. 

There were a lot of players in the segment, but our understanding of the space was if we can create value for anybody in a market that’s trying to articulate value of their product, offering, service or whatever it is, that whatever problem they’re trying to solve for their audience or persona – there is a definite chance that an interactive marketing tool works 10x or 100x better than, let’s say, a created piece of content that you create, or $100 that you pay a copywriter to write a kickass email.

So that’s where the learning was. And even before we could create a product, I closed a small $18,000 deal in the US market for the company, and then we started building the product. That’s how Outgrow, the company that still exists, does a 10 million ALR comfortably and with a 50 people team. That was my introduction to SaaS – I learned everything there is to know or everything that I know of SaaS and building a sales and marketing engine for SaaS. 

I run this company called Scale It Right, and the name as it suggests, we wanted to ensure that there is a way that you can learn how to build a company the right way. And the right way is subjective. So I’ll leave it up to you guys to decide what the right way is!

But when you see the nuance differences of how some of these startups build their companies – when they’re funded versus a bootstrap setup, you see very nuanced differences of how they think about customers, how they think about products, how they think about marketing, etc. Every single thing that I’m going to share is what a really good funded startup does really well. But you don’t need an ounce of funding, to get there you can do it yourself, even if you don’t have rounds and rounds of funds raised. So I’m just going to try and share with you guys the learnings that I’ve seen and how to build an engine. 

I think that something that I’ve picked up from some of the best founders that I’ve worked with is how do you create an engine. How do you create a repeatable, consistent set of tasks that can be done heads down on a daily basis, that can give you success as opposed to there’s a growth hack here or there’s a growth hack there. I don’t have any growth hacks for you guys. It’s more focused on what needs to be done. And from my experiences, I’ve noticed 80% of everything that you need to do is available to you. It can be done with no funding, no marketing expertise, nothing of that.

If you understand your product well enough, I think there’s a lot that you can do yourself to bring it to a certain extent where then you can have specialists coming and do what they do best. 

Building an execution framework [5:04 – 6:56]

So any founder that I meet, and I meet a bunch of them every single day. And every single interaction of mine with the founder starts with a single problem statement. 

And that is – as a founder, I know the space, I know the product that I’m building, I know the market, I know the persona, I understand the nuances of what they’re looking for. There’s a lot of nitty-gritty understanding that you have of everything that you do. But to translate this vision or the idea is if you can translate every nuance of your vision into execution frameworks, then you’re able to articulate value in the form of sales and marketing. 

And you put this into an umbrella of demand generation. Everything you do should essentially contribute to demand generation as an overarching umbrella – sales, marketing, customer success, your insights, etc. – what’s slowing back into your engine, what the engine becomes 6 months from now, 18 months from now, 3 years from now, you’re in a zero to one journey, one to ten journey, ten to 100 journey or beyond. Pretty much every step in the way is how do you translate your vision into value and put it into execution, and how does that value flow back into these engines. And then you keep tweaking it, tweaking it, tweaking it until you hit sweet spots in every step of the way. 

Why do you exist [6:59 – 9:46]

One of the things that I really want founders to sort of keep asking themselves on a daily basis is why they exist? 

And the idea of saying this is I see a lot of them sort of reading a lot about everything that’s happening and getting a little too enamoured by the industry, the space, the niche, the verticals and what not. And just to break a burst of bubble, if you’re entering the North American market, because we’re talking about scaling a SaaS set up globally, if you’re entering the North American market, I can assure you that the idea that you’re working on, at least 100 companies are doing it right now? There is no question about it. And at different levels of maturity? Some of them are already on top of their games, some of them are incumbents, some of them are setting up. Some of them are competing in the same space, have the same set of features, same set of pricing, same everything. 

So one question that you really need to answer is, as a founder, I understand that this is a real problem statement that my persona is trying to solve, and I’ve built the best goddamn product to solve that problem. And if you can answer that question every day, I think you’ll end up using all of those insights from the market and bake it into your strategy or execution. 

So have conversations with your prospects, customers, and team members. Let it be marketing, sales, product, anybody – all of them in sync should have a very nuanced understanding of the problem that you’re solving. So answer the existing existential question for the product and the company every single day. You should have the confidence to stand up and say, I’m building because I know there is a market for it. 

And when I say there is a market for it, it’s not that there are North Americans. It’s easy to sell it to them. They have credit cards, and they’ll put it in your payment gateway and keep paying for it every month. That’s not the idea. Although I will agree that it’s easier to sell in North America than it is to sell in India, and I can probably close more deals in the US. I can build these great relationships in the US, but I can tell you also that it’s a really tough market, but it’s also a fair market. And the idea of it being tough is that if you don’t articulate value well enough, or if the value itself is not good enough, they don’t care. It’s as simple as that! 

Actual Addressable Market (TAM is for investors) [9:54 – 12:40]

When you create your investor pitch decks, you always start with, my total addressable market is, you know, 2 billion, 5 billion, 10 billion, what not right? 

I think the total addressable market is for an investor to understand what kind of multiples are possible in a particular market or in the company that they’re investing in. For a founder, what you need to be more concerned about or worried about is what is the actual addressable market? 

If you look at a pie and if a pie is 100% –  in 100%, 95% of the market is using an existing solution or solving a problem in their own way and surviving happily. They’re an unaware market. They’re not aware that they need a solution to a particular problem statement. That is not your actual addressable market at all. So if you added a TAM slide in your pitch deck, I just removed 95% of it? 

So let’s talk about the 5% that you can actually address? When you look at a 5% actual addressable market, they might have a significant understanding of what their problem is. Or let’s assume they have an understanding of at least them considering that they have a problem, and they wish to solve it. Within the 5% is where competition kicks in. This is where there are large players in the market, funded players in the market. There are other companies just like you. There are big brands in the market. North America is too far away, right? So this 5% is the crowded space where you see everybody trying to enter this space. The lead gen databases that you build or the piece of content that you try to gate and invite people for a webinar – just understand that if you’re doing it, there are at least 1000 more companies doing it every single day. They’re flooded. They are flooded beyond imagination!

The understanding is if you can craft a way to understand, chalk out and document what this 5% is. Now your TAM could be 2 billion, but your actual addressable market is – there is a spend of about 20 to 30 million in the market that you can address, articulate value and can really grab this portion of the pie. 

Demand Generation vs Capture [12:42 – 16:25]

When we started Outgrow, we had a wish list of accounts that we wanted to target. The first 100 companies that signed up as customers, I knew them by name – this person from this company posted on LinkedIn and that he had this particular problem, which is why I’m talking to him.

So the top hundred, the ones that are going to give you real insights, the ones that are going to give you product feedback, the ones that are patient with you while you build the product, the ones that are going to support you and say, “all right, I’ll give you three more months of subscription till you fix this”, or he’s so concerned with support being in India that you do a great job with support, and then he’s okay. That hyper-personalised rich list of audience that you create for yourself essentially becomes your targeted-target list out of your entire audience. But remember that when you try and create demand for your product, there is a very superficial layer that indicates that this is a whole market.

That is not your market! There is a demand gen(eration) and then there is a demand capture. 

Out of the 100%, like I said, the 95% that you don’t have any connect with – you might not be able to sell the product to them today, but this is the audience that you should definitely invest in, in all of your organic channels. This is an audience that might come to you for information. They might not buy the product, but when they want to solve the problem, you should show up as a thought leader, or you should show up as the person who solves the problems for them, that – ‘I read about solving my problem here. So these are the guys that I trust that when my studio needs the software, I’m going to go back to these guys and evaluate’. 

So for the 95% of the market, which is your addressable market, but not necessarily your actual addressable market, you need to invest in educating this audience. Education is expensive – this is something that you’ll hear across the board. But education is not expensive when you do it consistently, frugally and like a bootstrap setup. No matter how much money you have in the bank, there’s only so much value that you can derive from whatever you’re doing.

You’re writing great content. You write 100 pieces of content this month, and next month you don’t do anything – your Google analytics graph is going to go like this (action: steep upwards) and then boom (action: sudden drop). You don’t want that. 

How consistently can you do something over a period of time – that is what defines your demand generation. And all the outcomes that you can expect are 6 months, 12 months, 18 months, or 24 months away. So in order to buffer for these time frames that it takes to really generate demand from the mass market, that is what you try and capture. So there’s a demand capture which is your top 5% of your wish list. 

North America (Not a market, but a mindset) [16:26 – 19:40]

This is one thing that I noticed, and I work with a bunch of India-based startups that are selling in North America, and although it’s global SaaS play here, I’ll try and stick with North America because that’s the market that I know best. I’ve spent some time there, I’ve spent some time here (re: India), and I’ve sort of looked at both the ecosystems as closely as I can. 

North America is not a market! 

Whenever you look at a market, don’t look at it from ‘oh, they’re paying in dollars’, or ‘they can buy with a credit card’ or whatever. It’s how can you be fair to them with your mindset. So I think there’s a lot of correction in the SaaS world that you see today, where quite a few of them will launch in North America, fail and come back to India. And this happens because they look at North America as a market, not a mindset. 

So as founders, I would definitely recommend to think of North America in a manner that they’re not just a geographical entity. You have to look at them for the mindset that they have. If you’re building the right thing, it does solve the problem, and you’re fair, they will buy it. 

Second thing, in addition to thinking of North America as a mindset, is essentially to do with this notion of not investing in brands. Whatever small brand that you build for yourself, you could be a champion product on G2 ground. You’re a brand. 

When I say brand here, I am not talking about your PR activity or who funded how much, etc. All of that is sustained for not more than 20 days – you get an uptick, you get brand keywords searched through the roof, and then you’re falling back down. 

The idea is to build a brand with your customers, is to build social proof around who likes you and why, and that you blow out of proportion. Somebody writes you a great testimonial. Blow that out of proportion. 

And the other thing about brands is that I see a lot of tech startups that don’t build great websites. I’m a sales guy. I’ve sold tech for ten years. I can probably have a conversation with a computer vision scientist and, you know, have a deep technical conversation and make great sales. But I’m still not a tech guy. But I can tell you that the impression that your website makes on the person landing there for the first time matters. If somebody tells you it doesn’t matter for the lack of a better word, it’s bullshit! 

Invest in building a great presence for yourself. North America looks at you, and they want to trust you. Give them chances to trust you. And the only way that you can do that is make sure that every email that you write has no grammatical errors, health check, make sure your signature looks great, have a good LinkedIn profile – make sure that every single ounce of presence that you have on a digital channel is trustworthy. That is when they trust you!

Strategy: Document to the T [19:41 – 21:38]

Strategy, as abused as the term is, look at strategy as how can you translate and document everything that you know into execution frameworks for each of the pieces of the puzzle- the entire demand gen puzzle, when you move into North America as the market is going to change. You had a sales-led motion in India. It’s going to change to a content-driven, marketing-led, product-led approach in North America. It just changes. And you cannot do that 6 months from now. 

You need to do that on day one. So when Hari says “I entered North America on day one”, that is someone who’s had success because he’s invested in that market from day one (hear him speak here: https://pentathlon.vc/nuances-of-scaling-b2b-startups-globally-part-1/). I’m not looking at North America only for dollars. I’m looking at North America because that’s where business is. 

As a SaaS product, if you’re building for India, great. But if you’re building for the globe, you might as well make sure that you’re building the right thing in the right way. When I say strategy, strategy needs to be a documented piece of evidence of how well you know this space. It cannot be, we sit in a boardroom, discuss for 30 minutes and strategy ban gaya? It’s how well you document every piece of information in a nice little collation of everything that needs to be done in a 6-month time frame or 12 month time frame.

I know that you guys might not have the bandwidth or the foresight to invest in a long term plan, like 18 months to 2 years or 3 years. But you can definitely break this down into 3 months at a time, like Hari was saying, and make sure that the strategy is visible to everybody. Strategy cannot be in the founder’s head.

So take it with a pinch of salt. But strategy cannot be in the founder’s head!

Measurable Outcome: Track every micro activity for success [21:40 – 23:03]

Being a founder, if you don’t know the numbers – red flag. 

Make sure you know every number. Which channel is contributing to traffic? Which channel is contributing to revenue? What is helping you close? How many conversations are you having? You need to be on top of all the numbers from day one. It’s not a 6 month down the line effort. Anything that you start 6 months down the line, it’s going to take another 6 months for you to get anywhere. So anything you start is today, and anything you track is today. Make sure that every channel, every effort, every campaign, every piece of strategy that you end up executing has a measurable outcome attached to it. 

And this has to be baked into your DNA. If a content writer is writing a piece of content, the content writer should very well know how his piece of content is performing. He can’t just write four pieces of content and publish it, and then don’t know what’s happening or don’t care what’s happening. He needs to know how much traffic did it get? Did it work with your focus keyword? Did you end up being on search? Are you getting enough impressions? Your content writer needs to know this data. Otherwise, he’s writing for himself, not for the persona?

[23.45 – 24.59]

Create consistency in a manner that everything becomes credited 6 months from now. How many pieces are we writing? Four? Eight?

How much ever you can write consistently over a period of time, write only that much. How many campaigns can you run consistently for the next six months? Do only that much. But make sure that your actual addressable market, that your target is getting what they’re looking for, that measurable outcome for every channel, everything that you will do in execution – is working or not.

Make sure you seek help when you need to create a dashboard that you cannot create by yourself. Google Analytics is an ocean. The search console is an ocean. Your campaign tool is an ocean. There are hundreds of things that you can find nitty-gritty details of that you’re missing today.

Get an expert, spend a couple of dollars. Create the best dashboard that you can track ‘this is working, this is not’. Create a list of it. Double down on everything that is working. So everything in execution will only work when you double down on the things that are working for you. 

The Playbook: Deliverables + Impact [25:00 – 29:20]

The idea of a playbook is, from an organic standpoint, as a business – what do you need to do sustainably, consistently over a period of time that will work for you.

I can assure you that all the growth hacks, the dynamic ideas, event ideas, webinar plans and everything that you think of as a great idea is the last 20% of the puzzle. It’s not the base. Your 80% is the repeatable consistent tasks that need to be done every single day. And all of these can be done every single day. And I’ll give you just the gist of how we do it for our startups that work with us is we break each of these into cadence. 

Everything is a cadence. SEO is a cadence, right? So we do site wide recommendations first and then we move on to page wise recommendations. For page wise recommendations, we commit to doing a certain number of pages every week. Okay, you have 100 URLs that are indexed on the search engine, we will do recommendations for 4 pages every week. In six months, we’ll cover 100. All pages are optimized from a technical perspective and content perspective. So over a 6 month time frame, SEO is on top of the game. You have complete predictability of how your SEO cadence is going, if you’re doing the right thing the graph is always moving up. You don’t see this (action: ups and downs), only your weekends should show a fall. Otherwise it should consistently be growing. And I can tell you for a fact that websites are set up incorrectly. The number of technical errors that we see on websites is ridiculous. 

Take some support in building the right thing on day one. You cannot have four iterations every 6 months and see how it goes. There is no how it goes. Before you hit, let’s see how it goes, you run out of money. 

Do not have the attitude of let’s see how it goes. Let’s do it right, let’s give it the best effort now, and then we’ll see which one’s working, which one’s not. If you make an honest effort, you will get an insight. If you make a dishonest effort, you’re not going to get anything. 

Look at our email playbook. Email itself is an ocean. It’s a great tool. I see people adding databases and sending campaigns every day. That’s not how email works. You have to create a cadence for email, email deliverability, email warm-ups, setting up the domain, creating campaigns and sequences, making sure your messaging is great. How much are you personalising, how relevant or not is it, how much of an audience is getting an automated sequence, how many of them are getting a personalised sequence, what tool stack are you going to use, and why – and this entire piece is just for email. 

You break cadences down for each of the channels like that. There is a gamut of things you can do on LinkedIn – form, SDR, etc. So every single piece of the playbook is essentially a cadence. Craft a playbook for yourself, and that essentially defines your success in a global scenario. 

India works differently. I didn’t speak about India at all because I just wanted to sort of keep that away from your mind. Because India is a sales-led motion. India is a brand motion. But it works differently. It works very differently. So I focused the entire chat on how you need to think about the North America market. I’m sure you guys will have a bunch of questions and we can dive in. Thanks. That was my time!

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About GTMDialogues:

GTMDialogues is a community in Pune built by founders, for founders. GTMDialogues hopes to connect SaaS entrepreneurs and foster opportunities to learn and grow within the SaaS community.

About HeadStart:

Headstart is one of the largest and oldest ecosystem enablers in the country, present in over 30+ cities in India, with three global chapters. Their Startup Saturday event is an initiative to help individuals new to entrepreneurship and the SaaS ecosystem grow and scale their businesses globally. 

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