SaaS Interviews with CEOs, Startups, Founders
Reduce Your Employee 'Burn Rate' to Improve Your Startup's Burn Rate: 5 Tips for Talent Retention
21 Jun 2023
Chapter 1: What are the key market pivot points for reducing employee burn rate?
I'm very excited to share this recording with you guys, which happened at our conference, sasopen.com, with over 100 speakers, all founders of B2B SaaS companies. We have a very high bar for what speakers share on stage, so you're going to enjoy this episode where we dive deep into revenue graphs, real tactics, and real growth metrics.
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Hi, everyone. My name is Soumya Murthy. I was the chief customer officer of Seven Lakes Technologies.
Chapter 2: How did the company transition from services to SaaS?
It was acquired last year by W Energy Software. And I'm going to be talking to you about reducing burn rate of human beings. So it's going to be a completely different conversation than you've been involved in up until now. And very quickly, as a chief customer officer, I was primarily responsible for numbers.
And over time, basically, I was brought in to do marketing and ended up owning sales as well. And in a $7 million ARR company, you need someone who's also helping groom the team and the leadership. So over the next 20 minutes, I'm going to talk to you about three big market pivot points and mark the people pivot points along the way.
The first one, this was a very solid services company when I came on board. How did we pivot from services to SaaS and get that product market fit? There are three pieces there around a really big, this was an oil and gas AI-based software company, so we got hit with a market downturn right when we were going to product.
Chapter 3: What strategies helped mitigate talent burnout during market downturns?
What did we do around focus that really helped reduce that burn rate? And also, we took that functional lens off and started to put a more psychological and organic talent lens. I'm going to talk to you a bit about what that did. And started to identify in-house talent of everyone from office managers to engineers on how we went to market around marketing.
then the next pivot point came around when we started to grow and ran into product implementation challenges and we needed to use again that psychological lens to know what talent gap do we have not necessarily functional solve the problem and then use two other really important piece of grooming internal leaders and also taking folks who are naturally more oriented towards variety
and not try to force them in some hierarchical ladder, right? So how did we do talent management to do that growth to 7 million? And then, of course, we all got hit with that 2020. And for us, it was negative $20 barrel of oil. And so we got hit again and needed to retrench.
Chapter 4: How can effective communication reduce employee burnout?
This was survival. So if y'all are into what that piece is going to be around, I'll talk a little bit about context switching and what we did there. And also, there's a whole bunch of unpaid emotional labor that happens during survival. So I'm going to talk a wee bit about what we did in addition to managing numbers on human beings. And finally, the myth.
We were really focused on busting the myth that it's lonely at the top. Because that really doesn't work in a startup environment. So I'm going to talk a bit about those. Just as I said in those pivot points from a revenue perspective, the first people pivot was around really when we hit the ground running product market fit. The second one's going to come around the $4.99 million number.
Chapter 5: What role does emotional hygiene play in talent retention?
And the third pivot's going to come around when we were doing our survival mode and we were acquired in May 2022. So, setting the footprint, pivoting into 2016. This was, like I said, a solid $15 million revenue services company. Awesome founder, awesome company. We were in the product stage of, of course I'm going to say that, product market fit.
And the critical expertise this company already had from a functional perspective was oil and gas. Badass oil and gas exploration and production. And systems integration, really strong R&D engineering roots. Towards the end of the 70s, 52 of us were still engineers and remained that. We wanted to keep it that way, right?
Chapter 6: How can leaders identify and groom internal talent effectively?
Roots in that stage of growth. And culturally, introverts, critical thinkers, super independent, very approachable. And our engineering base was in India. And the founder and the roots of the company was also Indian descent in America. I came in as a functional talent acquisition in US with enterprise, US enterprise experience. And we brought in sales, marketing, and finance.
Our CFO was there as well. In India, we continued to acquire. We had the Indian average Bangalore average attrition rates about 29%. percent or so.
Chapter 7: What are the benefits of creating an executive advisory board?
Ours was, at its best, 11%. And so we had a really good, strong way of acquiring and retaining talent. And of course, we start off with a market decline right when we hit the ground running. So the very first burn lesson that we learned was communicate change is actually medicine. So how is it medicine? Market turns, completely shifts the way it buys, shuts down in a very dramatic way.
Not just shuts down talking, it actually shuts down the budgets, right? So we use that, our founder to this day, just an excellent pivot master. And we had a team of very deliberative analytical engineers who would have done analysis paralysis. We use the situation to say,
Chapter 8: How do market changes influence employee retention strategies?
let's focus on these 20 plus options that we have to go to market, and really focused on one to two, and signal to the marketplace using customer experience-led prototyping that we're all used to. Now, in the burnout section, The folks that came in from the US enterprise, as you can imagine, struggled with this dynamic move and the nature of that kind of a pivot.
But the original service bootstrappers thrived for the most part. And the wins, we hit the ground running with $2.2 million ARR, 60 new logos added. And the biggest point, in this market, if you don't have an enterprise deal, your marquee accounts You're not going to make it for long. So we were able to hit that.
And we had a really strong market entry to go up against our competitors worth $300 million AR companies, existing incumbents, right? And vertically oriented Quorum and P2. So what we said was, hey, let's keep doing more of this, looking at our internal talent. but none of us were extreme talent experts. So what I'm about to show you is a lens that we in-house developed.
Now, guys, there are a whole slew of AI-based and other personality profiling things. So please don't look at these, although it's in a box. look at this more as a lens we created to start having normalizing language around organic talent. Because we human beings are complex designs, right? This is a psychological architecture of all of us.
If we fully expanded and became Buddhas, we would be all of this, right? But we're human. And we're going to expand in particular ways and designs. Now, very quickly, when you look at that up top, how do you make decisions based on objects, thinking, or based on people? And we live in some kind of range in our way.
And as you grow into the level of chief and run companies, you ought to have the flexibility. But this is one way. Left to right, how do you process information?
internally fully or are you out there constantly externally processing right so what we did was over time we developed the language of it's we couldn't just talk about the genius organic talent we wanted to also say what does actual burnout look like because can we recognize it in each other and we created radical transparency so people who come up to me or the founder or anyone else and say hey
This is your behavior Help out because and then so very quickly to map it out The more going to driver. I heard someone say challenging earlier when you spoke you're challenging in your detail. Just genius, right?
Otherwise, you won't have any control you won't be winning and hitting targets But you pass that battle pedal too hard and it's not the right sequencing you're going to get impatience and and and tunnel vision and poor listening and overly intense and Guilty. But the roots and talent of this organization was primarily in building. Man, systems thinking, detail-oriented.
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