Read time: 5 minutes

Congratulations! You’ve made it to the last edition of our "Raising from Strength" mini-series.

In this series we embarked on a 6-lesson packed journey together, exploring Go-To-Market (GTM) strategies and the intricacies of the GTM funnel. In this edition, we are excited to share real-world success stories that vividly illustrate the power of a well-crafted GTM strategy at each stage of the funnel.

In our mini-series, we spoke about the importance of a comprehensive GTM strategy. We've dissected the funnel into three pivotal sections: the Top of the Funnel (Marketing), the Middle of the Funnel (Sales), and the Bottom of the Funnel (User/Customer Success). Now, it's time to see these strategies in action, as we share stories of startups that have embraced these principles and flourished.

We hope that these success stories can serve as inspiration and knowledge, so you can use them in your startup to unlock revenue growth.

Mastering Monetization from Day One

We often witness companies taking flight with the promise of monetization looming on the horizon. While it might work for a few, our journey in this field has shown that, in the long run, delaying monetization often leads to a dead end. The key is to set the wheels of monetization in motion right from the start, growing it hand in hand with your product.

Some time ago, we worked with a data-sharing mobile app service. It was a promising concept but lacked a clear monetization plan. It had the right idea at its core: simplifying mobile data transfer. However, the vision for product growth and a monetization strategy were missing.

Upon analyzing the situation, it became evident that we aimed to compete with giants like WeTransfer, a business boasting $70 million in annual recurring revenue (ARR). So, the potential chunk of this pie was tantalizing.

We designed our monetization strategy around the fundamental value of our product—swift data sharing. We introduced a non-intrusive, ad-free tier and an expanded data-sharing feature behind a modest $20 annual subscription with a forecast in mind. Our lean approach, focused solely on facilitating data transfer without the complexities of file hosting, allowed us to keep fixed costs in check.

This strategy bore fruit. In a mere 6 to 8 months, by combining these principles and by doubling down on the best performance growth channels we skyrocketed from $30,000 in monthly recurring revenue (MRR) to $130,000 in MRR.

Had we offered our product for free from the outset, implementing monetization at a later stage would have been challenging. Users tend to stick with what they know, and human psychology tells us that it's tough to make someone pay for something they've enjoyed for free. On the other hand, by gradually adjusting prices as the product improved, we built a sturdy product with steady revenue growth and minimal user churn.

Streamlining Sales Cycles: A Manual on Lead Qualification

One of the core principles for expediting the sales cycle lies in the meticulous qualification of leads. Despite our profound respect for marketing, there are instances where the sales and marketing departments appear to be at odds, each seemingly pursuing slightly different goals.

Let me elaborate. As a business, it's essential to gather data on the number of Marketing Qualified Leads (MQLs) that transform into Sales Qualified Leads (SQLs) and, in turn, convert them into signed agreements. Leadership often makes an assumption that by increasing lead volume, sales will naturally surge in alignment with established metrics.

However, SaaS sales is far from a mechanical, manufacturing process; it relies on human interaction. Salespeople, like any other professionals, have their limitations, even if they don't readily admit them. There's a cap on the number of daily demos they can conduct while managing the sales cycle's ongoing calls, emails, and administrative tasks.

As an early-stage founder, your primary responsibility should be to optimize sales cycles before establishing a full-fledged sales operation. While sales might not be your core competence, nobody knows your idea or product better than you. Nevertheless, you might not be a sales virtuoso, which is why understanding some fundamental principles is vital:

1. Comprehend the Client's Buying Process: Familiarize yourself with the steps your clients go through when making a purchase.

2. Direct Communication with Decision Makers: While champions are essential, the ultimate decision rests with someone else. Make a concerted effort to reach and communicate with the decision-maker.

3. Hands-On Experience: Encourage your prospects to get hands-on with your product or tool. Take them beyond the usual demo; show them how your solution can alleviate their pain points. Demonstrate your commitment to supporting them throughout their journey.

4. Ask the Tough Questions: Pose challenging questions about the impact your product or service will have on their work, whether they recognize the value, and if they have a timeline in mind.

Adhering to these guidelines can significantly enhance your sales cycle. It provides you with control over the process and directs the course of discussions. While you might not win every deal, you can certainly reduce the time and effort invested in opportunities that aren't likely to yield new clients. Asking the right questions will lead you to the answers you seek, helping you pinpoint where your efforts should be concentrated.

To add some context, these principles have helped us close more than $20M in new ARR in companies we’ve worked at and helped this startup we worked with increase its revenue by 56.51% in only 3 months (image below).

Retain & Grow Customers in Your Sleep

In one of the startups I worked at, we received a customer whose initial ARR was $14,256 ARR, this was considered a small customer without much growth potential.

When I first engaged with this customer, my initial focus was on understanding their Desired Outcome. What did they hope to achieve or improve with my software? What were the challenges they were facing? Their Required Outcome (RO) became my compass.

It was clear to me that they needed an Appropriate Experience (AE), something that stood out and addressed their unique issues. This differentiated me from the competition.

With a solid grasp of my customer's needs, I set out to make the integration and setup process as smooth as possible. This was vital in reducing any friction in the customer journey, ensuring they could start using our software with ease.

During the onboarding, the main focus was to shorten the Time to Value (TTV) as much as possible since I wanted them to experience the true value of our product as swiftly as possible. It was important to make sure they reached the "aha moment" promptly.

This involved personalized guidance, going beyond a simple demo, and demonstrating how the software could solve their problems.

Throughout this journey, I diligently monitored activation metrics. These were key indicators of user engagement and retention. I also paid close attention to adoption metrics, making sure my customers explored all the valuable features our product had to offer.

By encouraging them to make the most of the software, I ensured that they saw its full potential and the value it could bring to their operations.

And by using these principles, our initial contract size of $14,256 grew exponentially. In just nine months, it had soared to $113,832 ARR.

This journey was about more than just numbers; it was a testament to the power of truly understanding your customer's Desired Outcome and optimizing every step of their journey.

This success story demonstrates that building a great product is just one part of the equation. Equally crucial is knowing your customer's needs and ensuring their journey is as smooth as possible. These principles have not only driven substantial revenue growth but also built a loyal customer base.

In Summary

These stories exemplify the transformative potential of foundational business principles. They reveal that when it comes to both monetization and streamlining sales cycles, understanding your customer's needs is paramount. This knowledge guides you in creating a product experience that simplifies integration, shortens the Time to Value, and maximizes customer adoption.

In the monetization journey, our strategic principles allowed us to shift from a modest $30,000 in monthly recurring revenue to an astounding $130,000 MRR within 6 to 8 months. In the context of sales cycles, these principles helped close over $20 million in new Annual Recurring Revenue and drove a startup's revenue growth by 56.51% in just three months.

The story of a customer who initially brought $14,256 in ARR showcases how a deep understanding of their Desired Outcome, reduced friction in their journey, and maximized product adoption can lead to phenomenal results. In a mere nine months, this small customer was transformed into an impressive $113,832 in ARR.

These stories stand as a testament to the incredible potential of these fundamental principles. Whether you are striving to optimize your monetization or growth strategy, streamline your sales processes, or retain and grow your customer base, these principles have proven time and time again that they are the path to success.

If you are ready to take your startup to the next level, this is how we can help 🏆️ 

1. GTM Courses: Recommended for startup founders who recently began their entrepreneurial journey and prefer an affordable, self-paced learning option.
   

2. Hands-on Collaboration: Recommended for startup founders who are already generating revenues and would benefit from a highly customized approach to unlock their startup’s growth.