SaaS Interviews with CEOs, Startups, Founders
How I hit $15m ARR using 4 new growth playbooks
14 May 2024
Chapter 1: What challenges did Gil face when his company was at risk?
You are listening to Conversations with Nathan Latka, where I sit down and interview the top SaaS founders, like Eric Wan from Zoom. If you'd like to subscribe, go to getlatka.com.
We've published thousands of these interviews, and if you want to sort through them quickly by revenue or churn, CAC, valuation, or other metrics, the easiest way to do that is to go to getlatka.com and use our filtering tool. It's like a big Excel sheet for all of these podcast interviews.
Check it out right now at getlatka.com. from 2 million to 12 million in ARR and what particular playbooks we use to get there. Some of them are not very sexy, but they've been tried over and over and over and are guaranteed to produce pipeline. So focus on that. A little bit about myself. I'm a software engineer, a robotic software engineer.
In my background, I turned into a marketer at some point. Did a good job because I have a technical background. And today, B2B marketing is a very technical job. So I've done well as a VP of marketing. And at some point, I saw the gap between what is available to a VP of marketing in terms of data and technology and what is possible in terms of data technology for a B2B marketer.
And I made a choice to take the leap and start a company that if you're our customer, you essentially don't have You don't have to hope for pipeline. You don't have to be a rocket scientist to generate pipeline because you use experimentation and data as a means to an end to guarantee that you have predictable pipeline with economies of scale.
A little bit about our revenue, because that's the proof that you should listen. We had a very interesting path where it took us years to find product market fit.
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Chapter 2: What aggressive measures did Gil take to cut expenses?
For years, we built this piece of software and did a lot of customer development. And in 2020, we found what we thought was product market fit. I was so happy. After years, finally, a meaningful revenue number, a meaningful ARR, but unfortunately, This also happened at the same time. Have you ever been in a situation as a founder where you're worried about your runway?
I couldn't sleep during that time. We had less and less money in the bank. And although we had product market fit, we had a repeatable sales cycle. The same kind of customer, the same kind of pitch, roughly the same amount of revenue, But the bank account went down and down and down. And investors wouldn't take my money. Not the good investors.
I had a bunch of sharks who thought it were bleeding and would give us terrible term sheets. But no good investors wanted to put their investment on the table. And so in one day, I've decided that instead of trying the same thing, trying to raise money with the same story that I have, product market fit, et cetera, I have to take ownership on the future of the company.
And so we decided to cut enough of the spending. And I'll show you exactly what tactics we did. What we took such aggressive measures to make sure that next time we go fundraising, we don't need the fundraise.
Chapter 3: How did Gil motivate his sales team during tough times?
And when you don't need the money, when you go to an investor and you tell them, this is happening anyway, you are invited to join us for this journey, the conversation is very, very different. You talk to different people, much kinder people, and you get term sheets that you're proud of, not something that you're ashamed to go to your board with. So what did we do?
First things first, the decision that many people don't like to do, cut expenses. I went through every line item in QuickBooks, every line item in my American Express credit card, and whatever was not necessary to keep the lights on, I didn't pay. Just like that. My credit score went down to about 300 at some point with American Express. They didn't like that.
And they would call me every day, pay your bill. I was like, I'm not paying anything out of the bill. Until I have money, then I'm paying all of it. And that happened eventually. But they didn't like the path in between. I have some derogatory marks. And I'm proud of it because it saved the company.
I also went to my sales team who were doing great and told them, look, I can't really pay you, but you're doing a good job. Can I convert some of your commissions into stocks? And surprisingly, more than 50% said yes. The best salespeople, in fact, said yes. And now they are the majority stakeholders in the company.
Chapter 4: What tactics helped Gil maintain customer retention?
A bunch of other hacks we did. I talked to all of the customers. I decided at that moment that I'm going to meet every customer that I have. We only had like, what, 50 or 40? But I met all of them and learned that for some of them that were about to churn, a piece of the product was still relevant to them.
So we launched a mini version of the product and were able to maintain some of the GRR, some of the retention. We did a bunch of other measures. For example, every campaign that I had, every marketing campaign that I had, had all the way to revenue ROI, return on investment.
I made sure that every campaign that we have generates revenue, not just pipeline, not just leads, but actually goes all the way to revenue. And so we were able to focus and then quadruple down on what was working. And so that was kind of the measures we took. From here, I can tell you, We got into break even. You don't see it here. That was the previous presentation.
But we got all the way to, I think, 25 grand in the bank. It's like not a lot of money in the bank. Almost going under and then slowly going up. From that moment, I was able to get 200K in accounts receivable debt. From that, I was able to get 300K in convertible note.
Chapter 5: How did Gil ensure marketing campaigns generated revenue?
And then $2 million raise. And then $4.5 million right after that. So being a sustainable company... chills out investor. They're like, all right, there's one less risk. I know you're not getting run out of money. I know this is happening anyway. Looks like you have product market fit. Now I'm going to give you a shot. And that year was a special year because after we raised that money, suddenly,
the survival was like we didn't have to survive. We didn't wake up every morning, OK, how am I making it one more day? And from that mindset, I still get cash updates, by the way, twice a week. So I still have a little bit of PTSD. But I don't wake up every morning thinking I'm running out of cash. And that gives you a little bit of, OK, now let's think about the vision. What do I want?
And when things started working out, the product market fit was really there. And so once we started investing in sales, in marketing, we're a little bit more spendful than before. we started focusing on what is repeatable that can take us to the next level.
Chapter 6: What playbooks did Gil implement for rapid growth?
And we actually negotiated. If the year before I negotiated with the board to cut the growth by half because I didn't have the money to support that growth, this year we're like, hey, How much more can we grow? This may not last forever, which it didn't, right? The economy tanked. So how do we take advantage of a market that is growing?
And so we renegotiated with my leadership team three times, and we almost made it to the third goal. So instead of going to five, instead of going to seven and a half, which was the new goal, we decided 12 and a half is the third goal, and we almost made it. Now, how did we make it? And that's the majority of this presentation. There are four cool playbooks.
Some of them came from us, Metadata, and some of them came from our customers. Because we run demand generation for B2B companies, B2B SaaS companies, mid-markets, then we have a lot of proof, a lot of quantitative proof on what works. When I say works, again, I don't talk about vanity metrics. I don't care about leads.
I don't care about impressions, click-through rates, all of those cool KPIs that growth hackers talk about, I really don't understand much about. I dive all the way into board-level KPIs, revenue, CAC, pipeline. Comparison guides. So we were poor.
Still, even with an A round, we were competing with giants that were creating categories, spending lots of money on SEO and SEM, owning all the display inventory.
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Chapter 7: How did Gil leverage buyer intent signals to generate leads?
So how do you compete with a giant that has like 400 million, if I'm not mistaken, in funding? How do you compete with someone like that? One hack is called comparison guides. We were able to parachute into deals in the last minute and steal it away. How does it go? So most companies invest advertising and marketing money in the entire funnel. Everything from what is this category about?
What problem are we solving? Who is the best vendor? What are the features? Why is our pricing the best? This is cool. If you have the money to do it, that's amazing. If you don't, we didn't. We said, hey, we're going to focus on one area only. When they get to the place where they're already qualified, they already know they want to purchase something.
And they're just comparing vendors, comparing features based on the problems that they have. I want them to know about us. In fact, when they do the comparison, I want to be the one that gives them the comparison guide. And so what did we do?
Chapter 8: What unconventional advertising strategies did Gil use for B2B?
First thing is, review sites. Just like there is Yelp for a consumer, there is G2, there is Trust Radius, and a bunch of other websites to help consumers of SaaS determine which vendor they should go with. This exists. We started paying. The biggest check I paid was for G2. I paid them for two things. One, to have lots of reviews so that our profile looks good. Our customers loved us.
I wanted to make sure it's very public. So we had one of the best G2 profiles. If you go there, you're already half in. The second one is, how do I know that the deal is being cooked? If my competitor is talking, he's not telling me, hey, to this prospect, you should join in. I need to figure out that the deals are in the making. So I purchased the buyer intent signal.
It's a very fancy name to pay for a web log data. G2 would send me their web log data. It's like a bunch of IPs and URLs. And what I did with that is reverse IP, So I understand which company it is, which location it is. I know who is my customer. So I will go and find the contacts of that customer.
And I would start bombarding them with emails and ads to tell them, hey, I think you're in a buying cycle for this particular product. Here's a comparison guide. It's a generic comparison. It's objective comparison guide. And the comparison guide was not created by us. It was created by G2. So there is credibility to it. But as the vendor, I can determine which features I'm sorting the guide by.
And I can sort it by the features that I'm best at. For example, we're best at ROI, the best vendor in our category. And so I would go and sort the buyer guide based on this feature. And with the customer, if they care about ROI or ease of implementation or customer service, boom, we come up first.
Even if you don't come up first, it's still worthwhile to do it, because if you're in the top three or top four, it's very likely that the person is going to give you a shot. They're going to give you half an hour on the phone to maybe convince them. Even if they use it as a negotiating tactic, they're going to give you the time of day to at least compare you to someone else. So person, guys.
from review sites. You don't brand it. Don't brand it with your logo. Make sure that the person who is buying understand this is an objective, as much as possible, objective comparison. And you'll get a shot at the table. This is how to do it. It's not very complicated. I do the step by step. By the end of this presentation, you have my email. I think Nathan will also send you these slides.
But this is very easy to implement. Within, I would say, a month, you can have this up and running. Second one, Convo Ads. Many times CEOs of SaaS companies or VP of marketing for SaaS companies ask me, how can I generate pipeline quickly? I am told that there is no silver bullet. It's wrong. There are some silver bullets out there. You can apply tactics.
It's a zero-sum game of time and money and the audience you're going after. There are some restrictions. But there are particular playbooks that can generate pipeline quickly. I'm not talking about e-book leads, webinar attendees. No, I'm talking about people who will hop on a call knowing they're going to be sold to. It's the person you want to sell to.
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