When SaaS companies are growing their business, there are a number of inevitable challenges that often crop up along the way. Growing pains for any business that is scaling isn’t unusual, but SaaS organisations often find that there are 5 key areas relating specifically to their sector that can occur.
If your SaaS company is currently going through a growth period and experiencing a few new pain points, see if you can relate to any of the below and we will tell you how to address them.
1. FINANCIAL STABILITY
It’s expected for SaaS companies during any part of their growth period, be it the very beginning or three to five years in, to experience some nervousness or uncertainty around financial stability based on decisions being made to continue to grow the company.
For example, factors such as inflation, overheads, employee salaries and benefits, investing in tech for your GTM team, the rising cost of living, the possibility of a recession and so on, all need to be considered.
Something the pandemic taught SaaS companies around the world is that anything that could potentially go wrong or impact businesses for a period of time, prompting business owners to keep a closer eye on their revenue and have enough profit as a backup going forward.
There are a number of tweaks your business can make to ensure an element of financial ability through any stage of your growth period, including:
- Offering remote working - the less people in the office each day, the less you will be spending overall on energy bills
- Negotiating better deals with vendors and suppliers - there are often discounts for startup companies or paying early, as well as discounts for agreeing to longer terms on contracts
- Investing in energy-efficient equipment and office space - renting office space that provides cost-effective technology such as motion light sensors
2. ALIGNING SALES AND MARKETING
As SaaS companies grow and more employees are on board, it is often quite challenging to keep GTM sales teams and marketing teams aligned with one another. Sales teams often have a strict sales enablement strategy that they stick to, in order to have the best chances of identifying new leads, closing new deals and retaining existing customers.
Similarly, marketing teams will have a digital marketing strategy in place to generate leads for sales teams to be able to contact potential customers directly.
However, as teams grow, they can sometimes begin to drift apart. The key to keeping sales and marketing teams aligned in SaaS companies is as follows:
- Have monthly meetings with marketing and sales teams to run through current campaigns, chase up current outstanding actions, raise any concerns and ask any questions about leads that have not been contacted
- Have weekly email updates from marketing to sales to ensure any leads that have come through that week have been communicated to the necessary team
- Have quarterly reports from both marketing and sales teams about the success of marketing campaigns / sales strategies, and where improvements can be made to increase conversions going forward
3. TALENT ACQUISITION
Another challenge for SaaS companies during growth periods is ensuring that the talent they are hiring is the right fit for the business.
Recruitment can be a challenging process for any organisation, of any size, at any stage of their business lifecycle. Knowing if a candidate, or candidates, are going to be successful within your company is a risk you have to take by hiring people you’ve been impressed by during the interview process.
However, during a period of growth for SaaS companies, mass hiring salespeople, onboarding them, training them and monitoring their performance is one of the most important but challenging obstacles hiring managers can face. Scaling a SaaS company always means your headcount will need to grow along with your sales figures. Your best bet would be to work with a specialist recruitment company that is used to working with hypergrowth SaaS companies.
4. EXPANDING INTO NEW MARKETS
If your SaaS company has been successful in one particular industry or sector and you are now trying to expand into a new market or markets, this is one of the biggest obstacles you will face as a business owner or leader.
We would advise you to:
- Do you research - don’t announce that you’re now working within X market until you’ve thoroughly researched the market itself, and actually worked within that space for a few months and established yourselves
- Identify potential customers to enable your business development, sales and marketing teams to target the same markets and align their messaging
- If expanding into a new market includes a new country or region you haven’t worked in before, ensure you invest time in researching and understand the local culture
- Identify your competitors - expanding into new markets often means jumping into an already-saturated market, so make sure you know who you are up against so you can shout about your company’s USPs
5. CUSTOMER CONVERSION AND RETENTION
As your business grows, so will the number of potential customers and leads coming in through marketing, business development and sales.
Team leaders need to ensure processes are put in place to close all conversion cycles with leads, whether that is an email to close a deal, a phone call or a meeting. If none of these options are available and the potential customer has become unresponsive, a process also needs to be put in place for follow-up communication to be sent to them further down the line.
The more potential customers and leads your GTM team has in their CRM system, the easier it can be to lose track of who has been contacted and when, which is where potential leads drop off. Ensuring processes are in place to maximise customer conversion is just as important as customer retention - retaining customers is also vital, otherwise your salespeople will find themselves in a constant cycle of needing to close more deals to keep the numbers from decreasing.
As your business grows, ensure you have the right processes, tech and support in place for your employees to be able to manage a high volume of sales leads, and if there are too many leads for your people to manage, it simply means it’s time to hire more talent.
GET IN TOUCH
Here at Strive, we source top tier sales talent for hyper-growth tech companies. To learn more about how we can help your business scale, contact our team on 0203 983 0770 or email firstname.lastname@example.org.