SaaS Founders, How to Navigate the Downturn With Accurate Revenue Data?

  • VC investment firm Reach Capital advised start-ups to “account for an extremely capital-constrained environment, even for companies with strong growth rates.
  • Sequoia alerted its start-ups to cut costs or face a ‘death spiral.’
  • “This market could still be choppy 15 months from now. So looking at 30 months of runway is a better goal for folks to have,” warned Craft Ventures.
  • Reevaluate your valuation, understand your burn multiples, and build scenario plans” is the advice to start-ups by a16Z.

VC Money Wells Are Drying Up

As told by an investor in this article, “The firehose of money that has been pointed at these companies is going to be 70–80% smaller.”

What Does This Mean for Start-ups?

Late-stage companies have their valuations at stake. They need to maximize their growth in this downturn to protect their valuation. Adding to revenue and conserving cash is extremely critical for them to ride this storm.

Are Job Cuts the Only Way to Extend Runway?

Do More With Less With The Right Data

By looking inwards at your own data and revenue systems, you can try to understand what factors contribute to poor burn multiple. And data lies at the heart of gaining visibility on where to make improvements, drive focus on leading indicators, and fix the revenue funnel before it breaks.

  1. Where are your reps spending time? Are they chasing the right deals?
  2. Are your Customer success team members meeting your top customers frequently?
  3. Are you losing more deals selling to technical buyer vs economic buyers?
  4. Is your sales team spending more time on low-margin customers?
  5. Are your reps ramping fast enough and enabling you to have a better payback period?
  6. Which stages are slowing down your revenue generation?
  7. Are your reps working on the hot leads that marketing generated?
  8. When was the last time your rep touch the committed deal this month?

5 Data Areas to Urgently Prioritize on This Downturn

Here are the areas founders need to address urgently if their goal is to increase company cash flow, reduce churn and accelerate revenue.

1. Monitor and measure your data quality

Poor data quality is responsible for an average of $15 million per year in losses. The quality of your data defines the impact it can have on your bottom line. Unfortunately, most data in systems like CRM is either inaccurate, missing or stale.

2. Unify your existing GTM data to capture all key selling moments

Your GTM data is a goldmine. If captured effectively, the insights from GTM data can be used to drive revenue. But this cannot work if the data that your company captures is siloed in separate tech stacks across sales, marketing and customer success.

3. Improve the ROI of your existing GTM tools

Tech stack continues to be a major source of investment for companies. An organization purchases 27 sales tools on average. But 42% of sales teams fail to see a clear ROI on these tools.

4. Take data-driven decisions to increase win rates

It’s not the right time to change your core systems like CRM. Work with the data you already have by investing in AI solutions that take care of not just automation but also add a layer of intelligence to your existing first-party data to help generate rich and accurate reporting and insights. These insights can be used to drive powerful decisions and take data-led actions across the GTM team.

5. Drive rep productivity with the right tools

Sales reps are critical cogs in the revenue machine. The way you enable them in this downturn will directly impact your revenues. Leaders must create an environment where their reps can thrive.

  • Leadership dictates how sellers should meet their sales objectives
  • Leadership is disconnected from the reality sellers operate in
  • Sellers just “go through motions” to meet their activity tracking requirements

Close Revenue Faster With Better Data

The bad data problem is very real and staring at organizations right now. It won’t go away overnight. But with the right data strategy, you can turn this crisis into an opportunity by fixing your data from its roots. Remediate the data gaps before it turns into a messy pile of system outages, siloed tech stacks, and lost revenue.

  • Never miss out on critical revenue data from entering your CRM
  • Have a clear view of where revenue leakage is happening in your GTM funnel
  • Get your GTM teams aligned and calibrated with communal data that is accurate and trustworthy
  • Make your teams more productive to drive higher win rates

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Been part of an amazing growth journey in building & leading a multi-Million, multi-region $SaaS business. On course to relive that journey at Nektar.ai

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Abhijeet Vijayvergiya

Abhijeet Vijayvergiya

24 Followers

Been part of an amazing growth journey in building & leading a multi-Million, multi-region $SaaS business. On course to relive that journey at Nektar.ai