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Help Wanted HN: Marketing and Sales for B2B Software Product

I'm struggling with marketing and sales for a B2B software product, and need your help. I've bootstrapped a single-product business selling add-on software for a well-known software solution deployed in reputedly 25% of development firms (and growing). For sales, there is a small collection of both large and small paying customers spread around the world (fun fact: the sales cycle ranges from 1 week to 1 year). Paying customers have told me that the product solves concrete problems, but I'm still not satisfied with fit partly because telling the right story is integral to finding fit. There is a trickle of a revenue stream, juicy TAM and upside, and established competitors with inferior but lower-cost solutions (customer's words) and primitive marketing (my assessment). Despite being well-versed in software & product development, I'm a marketing newbie. Pushing into marketing, especially positioning, opening sales dialog, and generally getting the message into peoples minds, I feel blind (side note: please mention "syzygy" in your message; this little trick helps filter for those who pay attention to details), lacking sheer know-how, and frustrated that I don't have the additional capacity to make the time investments that those activities properly deserve. I'm way stretched - I feel like too little jam spread over too much toast. Clearly, it's time to ask for assistance. So, I'm looking to strike a long-term, productive relationship with a talented and motivated person/people. An accomplished-but-still hungry autodidact, self motivated and disciplined. Like mercenaries or crack lieutenants, we'll cooperate to grow the product and ourselves. And if we find our synergy is great, the future is wide open.. Posting as throwaway. Pls Contact me using the email address in this account's profile.

PaulHoule 9y ago
which email address?
- throwaway-dena 9y ago
  Thanks for pointing that out! I updated the profile endena.ppa AT yandex DOT com
danieltillett 9y ago
What is your customer lifetime value[0]? This one value controls everything you need to do. 0. https://en.wikipedia.org/wiki/Customer_lifetime_value https://en.wikipedia.org/wiki/Customer_lifetime_value
- throwaway-dena 9y ago
  Appreciate your help! Not sure how to calculate this; I'll look into it, this[0] looks like a good start. I can say there are annual payment plans based on seats, with reduced pricing for continued patronage. ARR for each customer is (I'm eyeballing it) roughly 700 USD for smaller customers and 4000 per year for the larger ones, and they buy 1- or sometimes 3-year licenses. Most growth has come from customers that have just bought licenses with no or little questions. Some I have interacted with and arrived at a sale or a rejection that I can act on. And the rest slip through my fingers, like sand... 0. Referring to https://www.quora.com/How-do-you-calculate-the-LTV-in-a-subscription-SaaS-business-for-a-company-that-most-of-its-customers-chose-a-1-6-12-24-or-36-month-plan https://www.quora.com/How-do-you-calculate-the-LTV-in-a-subs... The article also mentions (LTV / CAC) > 3 "is good" which I've seen elsewhere, like First Round Review IIRC. Is this what you might have in mind?
  - danieltillett 9y ago
    This is tricky. Depending on your churn you are right on the border of a direct sales model being viable. The rough rule of thumb is you need a CLV of $2000 for direct sales to be viable. Below this number and you need to rely on marketing to drive inbound sales. My best guess is you are sitting in the sales valley of death. You have two ways to go - figure out how to increase your CLV so that direct selling (i.e. sales people on the phone) is viable, or decreasing your true CAC so that you can avoid the need for sales people. There is an alternative which I suspect you don’t want to hear - stay small and handle all the sales yourself. If you do this you can make money with a CLV well below $1000 and still do OK (it will be a ton of work). You are not going to be a billionaire, but you might be a millionaire.
    - throwaway-dena 9y ago
      According to scuttlebutt from other vendors on the same platform, word is that 4000$ per annum is the mode, representative of larger customers and therefore their tendency to stay as a customer for at least a generation worth, say 3 years. That would place CLV around the 12,000$ mark. Not sure if that is optimistic or pessimistic. There is a little churn, but lots of repeats too, makes me feel surprised. Given that, going back to your initial statement, is there some particular assessment about what I need to do?

PaulHoule 9y ago

which email address?

throwaway-dena 9y ago
Thanks for pointing that out! I updated the profile endena.ppa AT yandex DOT com

danieltillett 9y ago

What is your customer lifetime value[0]? This one value controls everything you need to do. 0. https://en.wikipedia.org/wiki/Customer_lifetime_value https://en.wikipedia.org/wiki/Customer_lifetime_value

throwaway-dena 9y ago
Appreciate your help! Not sure how to calculate this; I'll look into it, this[0] looks like a good start. I can say there are annual payment plans based on seats, with reduced pricing for continued patronage. ARR for each customer is (I'm eyeballing it) roughly 700 USD for smaller customers and 4000 per year for the larger ones, and they buy 1- or sometimes 3-year licenses. Most growth has come from customers that have just bought licenses with no or little questions. Some I have interacted with and arrived at a sale or a rejection that I can act on. And the rest slip through my fingers, like sand... 0. Referring to https://www.quora.com/How-do-you-calculate-the-LTV-in-a-subscription-SaaS-business-for-a-company-that-most-of-its-customers-chose-a-1-6-12-24-or-36-month-plan https://www.quora.com/How-do-you-calculate-the-LTV-in-a-subs... The article also mentions (LTV / CAC) > 3 "is good" which I've seen elsewhere, like First Round Review IIRC. Is this what you might have in mind?
- danieltillett 9y ago
  This is tricky. Depending on your churn you are right on the border of a direct sales model being viable. The rough rule of thumb is you need a CLV of $2000 for direct sales to be viable. Below this number and you need to rely on marketing to drive inbound sales. My best guess is you are sitting in the sales valley of death. You have two ways to go - figure out how to increase your CLV so that direct selling (i.e. sales people on the phone) is viable, or decreasing your true CAC so that you can avoid the need for sales people. There is an alternative which I suspect you don’t want to hear - stay small and handle all the sales yourself. If you do this you can make money with a CLV well below $1000 and still do OK (it will be a ton of work). You are not going to be a billionaire, but you might be a millionaire.
  - throwaway-dena 9y ago
    According to scuttlebutt from other vendors on the same platform, word is that 4000$ per annum is the mode, representative of larger customers and therefore their tendency to stay as a customer for at least a generation worth, say 3 years. That would place CLV around the 12,000$ mark. Not sure if that is optimistic or pessimistic. There is a little churn, but lots of repeats too, makes me feel surprised. Given that, going back to your initial statement, is there some particular assessment about what I need to do?