Beyond Product-Led Growth: The Key to Faster SaaS Startup Expansion

In SaaS, there are two predominant sales approaches: 'Self-service' and 'Sales-touched'. 'Self-service' relates to customers procuring your product or service autonomously, without any direct intervention from your team. Conversely, 'Sales-touched' involves a sales representative from your side guiding the purchase process.

A trend I've observed among early-stage SaaS startups is an eagerness to prioritize and rapidly scale self-service sales, often motivated by the popular buzz around Product-led growth. This approach, especially in the early stages of a B2B SaaS startup, can be a costly misstep.

The main objective for startups in their early days isn't growing at all costs but instead laying the groundwork for sustainable and predictable growth.

For early-stage SaaS startups, it's imperative to emphasize sales-touched transactions, and here are two pivotal reasons why:

Reason 1: Insightful Learning

Your growth in the SaaS world relies on rapid learning and adaptation. Direct conversations with potential clients are critical. These interactions offer insights into their challenges, goals, and language. Plus, they help refine your pitch and solution. Often, the most innovative ideas emerge when presenting your solution to a prospect, which helps challenge your ideas and the way to present them.

I've encountered numerous founders aiming for more self-service sales. When examining their situation together, we found that they viewed it as a way to overcome their challenges in finding and selling to prospects. Interestingly, self-service sales can be even more challenging than sales-touched ones. But that's a discussion for another day.

Trying to avoid sales-touched deals in the initial stages is a misstep, especially before hitting $1M in ARR. Once you've established a consistent lead generation and closing process, only you can consider boosting self-service sales.

To clarify, I'm not suggesting self-service sales pre-$1M ARR is always ill-advised. However, the risk of stagnation is real if you haven't gleaned enough from customer interactions to fuel growth before and beyond the $1M ARR mark. If you are experienced in your market, smart, and lucky enough to know well about your customers, who are also willing to buy your product in a self-service mode, you might be able to IPO with only 20 Account Executives. There are maybe less than 10 startups who achieved that. Twilio is one of them.

While you could be this next kind of success story, consider if that's a gamble you're willing to take, given the other uncertainties in your startup journey. Don’t you have enough risk to manage elsewhere in your startup?

Reason 2: Network building

When prospects interact with your brand online without talking to you, you are building a relationship. If your product stands out and you've already built trust, you’ll eventually be able to convert those prospects into customers. Ultimately, you'll benefit from word-of-mouth, the ultimate lead-generation strategy.

However, this doesn't come easily for startups still finding their product-market fit, with an unfinished product and limited recognition. You'll need to generate word-of-mouth manually. While referral bonuses can be a tactic, in the B2B SaaS world, they often don't resonate as intended. Sure, customers might appreciate a $1,000 credit, but they might not go out of their way to understand and use a referral program as much as it happens in B2C.

As a SaaS founder, direct conversations with prospects and clients are invaluable. It is through these interactions that you truly connect and demonstrate your commitment to their needs. As a result, they're more likely to assist with introductions to their (LinkedIn) network, participate in your webinars, contribute to case studies, or vouch for you with potential clients. Business is about people. Opportunities come by talking to people.

In B2B Sales, one successful deal can lead to ten more! It's up to you to drive those additional ten deals

To optimize the benefits from sales-touched deals, you should have a clear plan of action, understand your objectives in terms of outcomes before each engagement with your prospects & customers, and excel in discovery. This approach is more scientific than artistic.

Whenever you're ready, there are 2 ways I can help you:

1- Sales & GTM Advisory: I help SAAS founding teams accelerate their growth through personalized coaching on sales and go-to-market tactics and strategies.

2- Workshops: I'm organizing live training workshops to cover specific sales & GTM topics.