5 ms·

I think it takes a very long time to grow a SaaS. Think multiple years. I started 4.5 years ago and it took nearly 4 years until I felt fully comfortable. Slow

by jwr 6y ago

I think it takes a very long time to grow a SaaS. Think multiple years. I started 4.5 years ago and it took nearly 4 years until I felt fully comfortable. Slow growth is to be expected. My growth curve, in fact, isn't a curve at all: it's pretty much a straight line if you plot paying customers. It looks better for MRR (monthly recurring revenue, your main metric), because I've been working on raising ARPU (average revenue per user). The "long slow saas ramp of death" is real. Google it. You can supposedly grow faster if you do marketing well. But from what you wrote I'd guess that you do not do marketing well. My adventures with marketing came down to the following conclusions: * Spending money on ads is basically burning money and does not work for me. (tried Google Ads, LinkedIn, Facebook ultra-targeted ads, Quora). This became painfully obvious after I implemented my own conversion tracking, because I did not trust their metrics/analytics. * You will find plenty of marketing experts all around you, but none of them will work for a commission, which speaks to how much trust they really place in their "skills". * Since I am a solo founder, I eventually decided that I'm OK with my organic growth and I'd rather concentrate on making the product better. This helps in building bigger product value, improves customer retention, allows me to raise the ARPU, and in general works great. I just don't get the marketing-pumped stream of new customers. But I'm OK with that, especially at this point. That said, I think I would expect more than 8 paying customers after a year. My ramp-up in the first year was slow (the product didn't have a lot of value back then), but it was quicker. I just checked, and I had 25 paying customers after one year from the first one.

Veen 6y ago
> You will find plenty of marketing experts all around you, but none of them will work for a commission You won't find many developers who work on a commission either.
- zeptonix 6y ago
  The developers have a lot more risks (the product never gets built, the product at its end isn't compelling, the founder moves on to something else and/or there never is any follow-through). The marketers are being asked to help take something that already has been built and make it take off. I think his point is a valid one that this isn't something you often see, which does run a bit counterintuitive to what you'd expect especially since commission-based structures are so common generally in sales.
  - Veen 6y ago
    One of the issues is that sales generated by a salesperson are a lot easier to attribute than sales generated by marketing. Let's say that, as a content marketer, I write an article for a client's blog that is widely shared. The article increases mindshare for the product, helps to establish the brand, and makes a material difference to the number of sales over the next year. But how does the business attribute those sales to me so that I get my commission? Many of those sales will not be from people clicking a CTA on the blog article, but from people who remember the brand and make a purchase weeks or months later. It's not even as easy as it seems to attribute sales to PPC or other forms of advertising.
  - nickfromseattle 6y ago
    Developers building products that noone uses is the status quo. There are likely hundreds of thousands, or millions of developer built apps with no users. Just because a product was built does not meet the only thing left is marketing. In fact, I would rather have great marketing than a great product. A lousy product with revenue can be iterated on more quickly than a great product with no revenue.
- ht85 6y ago
  That's because it's fairly easy to link acquisitions with different marketing channels, whereas that is not possible for most technical work. If you want to give engineers a financial interest you do it through options / stock, which is very common.
  - deleted 6y ago
    [deleted]
- nickfromseattle 6y ago
  > * You will find plenty of marketing experts all around you, but none of them will work for a commission, which speaks to how much trust they really place in their "skills". Your product is unproven. How do I know you can convert and retain a qualified audience?
  - jwr 6y ago
    In my case, it's very much proven. I can show organic growth over 4 years, retention stats (excellent), etc. — it's very clear what the traction is and compared to incoming traffic, all parameters are excellent. So this is not the problem.
- jwr 6y ago
  I don't think this is a good analogy, for many reasons. Also, the reason why I wanted to have a marketer on a commission is not because I don't want to pay or because I don't have money. It's because I want accountability. My strong suspicion is that most of the self-proclaimed marketing gurus do not deliver.
  - Veen 6y ago
    There certainly are marketing "gurus" who are nothing more than conmen. But skilled marketers also come across "founders" with nothing but a shitty MVP (or even just an idea), an inflated sense of their own ability, and grossly exaggerated expectations of the potential of their product to change the world, if only a marketer would "partner" with them to build a brand and traffic. It's a huge risk for a marketer to invest months of time in a product that could go nowhere because the founder is a flake or the engineering doesn't work out — all on commission with no stock options if everything comes together.
csa 6y ago
> You will find plenty of marketing experts all around you, but none of them will work for a commission There are many marketers who will work on commission (e.g., affiliate marketers, some/much of which is not BS). The challenge is creating a context in which a producer and seller can work well together. Specifically: 1. The seller needs to have a product that people want. That’s product-market fit. 2. The seller needs to be willing to pay the marketer enough to make it worth their time. Many producers fall woefully short in this department. Sometimes it’s because the producer is cheap, sometimes because they don’t value marketing, sometimes it’s because they don’t price the cost of marketing into their product (either not at all or not correctly). 3. On top of all of the above, there needs to be a sales funnel that converts. This can be set up (even crudely is ok) by the producer, or it can be set up by the marketer. Note that a good sales funnel takes time to develop and refine, and doing so is expensive —- expensive to the point that the marketer maybe should be a co-owner rather than a hired gun. If a producer is missing any of the above, they will naturally only attract folks who will work for a flat fee rather than a commission, and that’s because the groundwork has not been laid for a commission system to work / be worth their time.
rsoto 6y ago
> You will find plenty of marketing experts all around you, but none of them will work for a commission, which speaks to how much trust they really place in their "skills". As a marketer myself, it's not that we don't trust our skills, it's that few things happen in short term. If I'm going to work with you with commisions it's because I have trust in your product in the long run (2+ years, at least). Otherwise I could spend a year optimizing your site, your funnel, your strategy and you could easily fire me and keep all the strategy, SEO and branding done to your site.
- jwr 6y ago
  This a very good point. And it's also exactly how I see a potential relationship. Beginning with a proven product (4 years history of organic growth with low churn), and with a long-term outlook. I've yet to find a marketer that would be interested. To be honest, I'm not that surprised — I want accountability, and there are many others out there who do not, and with faster-growing businesses.
shostack 6y ago
Others have beaten the "marketer on commission" horse to death. I fully agree with their comments, but I want to address something else. >"Spending money on ads is basically burning money and does not work for me. (tried Google Ads, LinkedIn, Facebook ultra-targeted ads, Quora). This became painfully obvious after I implemented my own conversion tracking, because I did not trust their metrics/analytics." When I hear about solo founders decry poor results from paid media, lack of trust in tracking and metrics, etc., I often wonder how much time they've actually invested in learning what they are doing. Managing paid media is a career and industry in and of itself that is highly-technical, rapidly evolving, and requires deep understanding of the specifics of individual platforms, creative, audience, etc. The metrics themselves are INCREDIBLY nuanced, and I've come across more fellow marketing professionals than I would like who aren't familiar with the impact of view through conversions, how they should be viewed in relation to other efforts, where/when/why they will mess up your analytics in different platforms (for example, FB view throughs are counted by default, but will not show up in Google Analytics). So when you say they are basically burning money and not working for you, my gut tells me that there are decent odds things were not setup, tracked, or optimized according to what many in the paid media industry would consider best practices. This is NOT a knock against you. This stuff is difficult, but the platforms go out of their way to make it easy to get started and spend large sums quickly with settings that may not actually make sense for what you are trying to accomplish. Which brings me back to the commission thing again. People who know this stuff work on a variety of models. Many of them value their time quite a bit (myself included) and would not be willing to shoulder all of the risk. That said, paying for an initial flat rate consult to evaluate your previous efforts to validate your approach and gauge how much they reach the same conclusion (ads don't work for you) might well be worth the time and money.
- jwr 6y ago
  It is entirely possible that I have no idea what I'm doing with ads. I did try to learn and apply all the knowledge I had. My conclusion was not that it doesn't work at all, just that it doesn't work for me and I would not recommend it to other solo founders. As to commission-based work, I still think that when presented with a SaaS with a good 4-year track record, a confident marketer should at least consider something else than a flat rate. What exactly is the risk here? There is organic growth, there is customer retention, there are MRR numbers. After a customer learns about the service, everything else is known and very clear. What remains to be done is work on what happens before a customer learns about the service, which in my opinion is entirely on the side of the marketing person. I guess my skepticism is also before I haven't met a marketing person that is convincingly good at what they do.

by jwr 6y ago

Veen 6y ago

> You will find plenty of marketing experts all around you, but none of them will work for a commission You won't find many developers who work on a commission either.

zeptonix 6y ago
The developers have a lot more risks (the product never gets built, the product at its end isn't compelling, the founder moves on to something else and/or there never is any follow-through). The marketers are being asked to help take something that already has been built and make it take off. I think his point is a valid one that this isn't something you often see, which does run a bit counterintuitive to what you'd expect especially since commission-based structures are so common generally in sales.
- Veen 6y ago
  One of the issues is that sales generated by a salesperson are a lot easier to attribute than sales generated by marketing. Let's say that, as a content marketer, I write an article for a client's blog that is widely shared. The article increases mindshare for the product, helps to establish the brand, and makes a material difference to the number of sales over the next year. But how does the business attribute those sales to me so that I get my commission? Many of those sales will not be from people clicking a CTA on the blog article, but from people who remember the brand and make a purchase weeks or months later. It's not even as easy as it seems to attribute sales to PPC or other forms of advertising.
- nickfromseattle 6y ago
  Developers building products that noone uses is the status quo. There are likely hundreds of thousands, or millions of developer built apps with no users. Just because a product was built does not meet the only thing left is marketing. In fact, I would rather have great marketing than a great product. A lousy product with revenue can be iterated on more quickly than a great product with no revenue.
ht85 6y ago
That's because it's fairly easy to link acquisitions with different marketing channels, whereas that is not possible for most technical work. If you want to give engineers a financial interest you do it through options / stock, which is very common.
- deleted 6y ago
  [deleted]
nickfromseattle 6y ago
> * You will find plenty of marketing experts all around you, but none of them will work for a commission, which speaks to how much trust they really place in their "skills". Your product is unproven. How do I know you can convert and retain a qualified audience?
- jwr 6y ago
  In my case, it's very much proven. I can show organic growth over 4 years, retention stats (excellent), etc. — it's very clear what the traction is and compared to incoming traffic, all parameters are excellent. So this is not the problem.
jwr 6y ago
I don't think this is a good analogy, for many reasons. Also, the reason why I wanted to have a marketer on a commission is not because I don't want to pay or because I don't have money. It's because I want accountability. My strong suspicion is that most of the self-proclaimed marketing gurus do not deliver.
- Veen 6y ago
  There certainly are marketing "gurus" who are nothing more than conmen. But skilled marketers also come across "founders" with nothing but a shitty MVP (or even just an idea), an inflated sense of their own ability, and grossly exaggerated expectations of the potential of their product to change the world, if only a marketer would "partner" with them to build a brand and traffic. It's a huge risk for a marketer to invest months of time in a product that could go nowhere because the founder is a flake or the engineering doesn't work out — all on commission with no stock options if everything comes together.

csa 6y ago

> You will find plenty of marketing experts all around you, but none of them will work for a commission There are many marketers who will work on commission (e.g., affiliate marketers, some/much of which is not BS). The challenge is creating a context in which a producer and seller can work well together. Specifically: 1. The seller needs to have a product that people want. That’s product-market fit. 2. The seller needs to be willing to pay the marketer enough to make it worth their time. Many producers fall woefully short in this department. Sometimes it’s because the producer is cheap, sometimes because they don’t value marketing, sometimes it’s because they don’t price the cost of marketing into their product (either not at all or not correctly). 3. On top of all of the above, there needs to be a sales funnel that converts. This can be set up (even crudely is ok) by the producer, or it can be set up by the marketer. Note that a good sales funnel takes time to develop and refine, and doing so is expensive —- expensive to the point that the marketer maybe should be a co-owner rather than a hired gun. If a producer is missing any of the above, they will naturally only attract folks who will work for a flat fee rather than a commission, and that’s because the groundwork has not been laid for a commission system to work / be worth their time.

rsoto 6y ago

> You will find plenty of marketing experts all around you, but none of them will work for a commission, which speaks to how much trust they really place in their "skills". As a marketer myself, it's not that we don't trust our skills, it's that few things happen in short term. If I'm going to work with you with commisions it's because I have trust in your product in the long run (2+ years, at least). Otherwise I could spend a year optimizing your site, your funnel, your strategy and you could easily fire me and keep all the strategy, SEO and branding done to your site.

jwr 6y ago
This a very good point. And it's also exactly how I see a potential relationship. Beginning with a proven product (4 years history of organic growth with low churn), and with a long-term outlook. I've yet to find a marketer that would be interested. To be honest, I'm not that surprised — I want accountability, and there are many others out there who do not, and with faster-growing businesses.

shostack 6y ago

Others have beaten the "marketer on commission" horse to death. I fully agree with their comments, but I want to address something else. >"Spending money on ads is basically burning money and does not work for me. (tried Google Ads, LinkedIn, Facebook ultra-targeted ads, Quora). This became painfully obvious after I implemented my own conversion tracking, because I did not trust their metrics/analytics." When I hear about solo founders decry poor results from paid media, lack of trust in tracking and metrics, etc., I often wonder how much time they've actually invested in learning what they are doing. Managing paid media is a career and industry in and of itself that is highly-technical, rapidly evolving, and requires deep understanding of the specifics of individual platforms, creative, audience, etc. The metrics themselves are INCREDIBLY nuanced, and I've come across more fellow marketing professionals than I would like who aren't familiar with the impact of view through conversions, how they should be viewed in relation to other efforts, where/when/why they will mess up your analytics in different platforms (for example, FB view throughs are counted by default, but will not show up in Google Analytics). So when you say they are basically burning money and not working for you, my gut tells me that there are decent odds things were not setup, tracked, or optimized according to what many in the paid media industry would consider best practices. This is NOT a knock against you. This stuff is difficult, but the platforms go out of their way to make it easy to get started and spend large sums quickly with settings that may not actually make sense for what you are trying to accomplish. Which brings me back to the commission thing again. People who know this stuff work on a variety of models. Many of them value their time quite a bit (myself included) and would not be willing to shoulder all of the risk. That said, paying for an initial flat rate consult to evaluate your previous efforts to validate your approach and gauge how much they reach the same conclusion (ads don't work for you) might well be worth the time and money.

jwr 6y ago
It is entirely possible that I have no idea what I'm doing with ads. I did try to learn and apply all the knowledge I had. My conclusion was not that it doesn't work at all, just that it doesn't work for me and I would not recommend it to other solo founders. As to commission-based work, I still think that when presented with a SaaS with a good 4-year track record, a confident marketer should at least consider something else than a flat rate. What exactly is the risk here? There is organic growth, there is customer retention, there are MRR numbers. After a customer learns about the service, everything else is known and very clear. What remains to be done is work on what happens before a customer learns about the service, which in my opinion is entirely on the side of the marketing person. I guess my skepticism is also before I haven't met a marketing person that is convincingly good at what they do.