When SLG passes PLG on the inside.
Your finance team isn’t a cleanup service Most SaaS founders dream of building an app that is so beloved that customers just sign up and pay with a credit card. When I was at Zendesk back in 2009, that was literally the case. Over 20 percent of trials converted to paid every month and people just swiped their credit card. As Mikkel Svane once jokingly said to me, “if this product didn’t sell itself, I am not sure what we would have done”. Then came along Rackspace with the intent of buying hundreds of seats. I negotiated a deal with them and they received a good ol’ invoice, which was probably paid by check. In doing so, shattering the PLG dreams of every sales hating founder because of the first juicy deal. The reality is that for 99% of B2B SaaS startups out there, you will end up hiring salespeople. The same thing happened at OneLogin. The first large deal was invoiced by our accountant. As you start building out your sales team, the finance team just invoices them without any complaints. They’ll hire more people if needed. The inflection point is when sales-led deals are no longer the exception. They *are* your revenue driver. You hire sales managers, sales VPs and a Chief Revenue Officer. Sales are the hero. They bring in the big numbers. Now, this may or may not happen to your startup, but in some cases, sales might get a little out of control. There might be cases of excessive discounting, creative deal structures and commitments that will cause some headaches. A big deal may come in that has the finance team rolling their eyes, but who’s going to blame the hero who closed another big deal? It’s important to understand that finance is not a cleanup service. Even sales has to do what’s good for the company overall. Too many complicated deals are going to become a drag on the company in terms of account management, revenue recognition, self-service, product updates and future price changes. I recently spoke to an executive whose company wanted to revise their pricing structure, but they had thousands of deals that were completely different, which in this case was actually more the founders’s fault. They realized that the price structure change would take years to implement because of this mess and ultimately dropped the idea. When your company reaches a point where it looks like sales-led deals are going to be a significant part of your future, it’s time to get your quote-to-cash processes automated so you can continue to execute at cloud speed. Price. Quote. Bill. Chill.