How SaaS Revenue Data Can Help You Retain Talent | ChartMogul Dir of Sales & Marketing Sara Archer

We have Sarah Archer, who is joining us from Germany. So she is the head of sales and marketing at ChartMogul. She's going to be talking to us today about how SaaS revenue data can help you retain talent and grow faster. Couple reminders before we let Sarah get into the content. This will be an interactive 20-minute session. So we encourage you to keep your cameras on, um, mute yourself for your audio, but feel free to come off mute when we get to the Q&A section, if you would like. You can also raise your hand in the participant to ask a question if you'd like, and I can help facilitate you going off of mute. All of these sessions will be recorded and available on demand post-event, so make sure that you subscribe to SASter's YouTube and follow us on SASter SlideShare. Sarah, thanks so much for joining us.

I'm going to let you take it away.

Great. Appreciate the warm welcome. I'm Sarah. It's a bit dark here in Northwest Germany, but I'm really pleased to be here. And the topic that I've chosen to facilitate today's roundtable on is how SaaS revenue data can help you retain talent and grow faster. Now, at ChartMogul, I have the opportunity to talk to loads of SaaS businesses, SaaS founders, and operators about how to use SaaS metrics to improve growth. But today's session is a little bit of a thought experiment, and I've compiled some ideas that I'm really excited to share with you about how those same metrics that you're familiar with, that you know and love, can actually be used to improve company culture and retain talent. So the format is about 10 minutes of me sharing some ideas, then we can chat a bit about it. And perhaps you have some questions or some feedback, and we'll get started. Great. So a quick story just to start us off. Not too long ago, I was at a sales training in Berlin. Winning by Design, would really highly recommend if you're not following their content or interested in their trainings, have at it. Our sales trainer put this exercise up on the board. And for a room of CEOs, VPs of sales, CROs, he said, hey everyone, for me, if you would just model the customer acquisition process and small incremental improvements along the way, what would happen if you could improve your MQL to SAL ratio just 10%? And what is the, is the, the end outcome? And I tell this story not so much for the exercise, but for the palpable general feeling in the room that this exercise emoted. A little bit of fear, kind of like being called up to the front of a whiteboard in school and being asked to do arithmetic on the fly. And I thought that was really interesting because we're all hardened professionals, right? I'll spare you doing the math and just tell you what you probably already know because you're in SAS. Small incremental changes at key areas can have outsized impact. And that's part of probably why we've chosen this industry. We can ostensibly double our revenue by changing things 10% here, 10% there. And so this got me thinking that like most things in life, we all exist on what I've called the SaaS metrics comfort spectrum. Some of us may be brand new to SaaS and on the left-hand side of the spectrum. Fish out of water. Others are those hardened professionals that didn't break a sweat during said exercise. And those are some of the speakers and some of the content followers that we consume and know, the professionals. And so this spectrum, I think, has really pertinent and real relation to our day in, day out. And that's because setting and achieving SaaS revenue targets requires a level of confidence. And a level of confidence that means hopefully you're far to the right, you're a duck, you're a duck in water. Because you need comfort with basic math, basic statistics, and arguably large compounding sets of data. You also need to have a firm grasp of key commercial processes and shared and consistent definitions across your team. So in one business or another, what constitutes an opportunity in Salesforce, and is that enforced consistently across across your sales team. Yeah, it's nice to say yes when that's true, but I think many times we've seen that that's not the case, right? So that and you need shared and consistent calculations of key SaaS metrics, so MRR, LTV, those fun 3 little acronyms. So these are kind of table stakes, right, to be able to model and strategize in order to set a plan, and then on top of it, you've got to execute, right? And so what happens a lot of times, maybe through the fault of an individual or an organizational failure, is one of these core things is missing. And when we say, here's your ARR target to a new head of whatever, someone that owns a number, they go out and they miss that target. And that is perhaps related to another trend that we see in industry, which is a decline in tenure. This is from a Gong study. Study, I think 2018 or so, where ostensibly your VP of sales is there maybe enough time to get the lay of the land and then start to find their replacement. And so I think these things are related. Certainly, there are other factors in play, and we're not going to untangle all of them. And it's not consistent to say— it's not exclusive to sales teams, right? In software, we have really high employee attrition. And I find that that's quite problematic. Our average employee tenure is less than retail from a 2017 pre-COVID study. And I, for one, if I am working for a company with a mission that I believe in, and I am fairly compensated, and I'm challenged most days, I want to stay for the long term and be a part of that.

Story.

And I think that's true for many of our employees as well. So if we look at some of these trends combined with why people are attracted to SaaS, these top reasons that I've listed sort of here from, from another study, folks really come and are attracted to the industry to make an impact and because of the culture that we create as SaaS revenue leaders. This is why people join. Probably some of the companies that are in the audience, and importantly, why people stay. And so the thought experiment that I kind of want to have over the course of the last— I don't know— few minutes is, what if you could help your employees understand and improve their impact using SaaS metrics? What if you could give context to your employees, and then as a result, they could take ownership of some of these key areas and really help move the needle? So I looked at a little bit of preliminary research from some of our own findings at ChartMogul to say, well, what are other companies doing? If you're a $10 million or a $30 million ARR business, how many of your employees are regularly interacting with SaaS metrics? And what we see is that as companies grow, more individuals are taking advantage of the insights that SaaS metrics provide. And so interestingly, like our user, our pricing, our go-to-market model isn't tied to like user upsell. You can add as many users to your ChartMogul account as you like for no additional charge. But presumably businesses are adding users and letting more people access SaaS metrics because they see value in doing that. So this might not be terribly surprising, but I think it, you know, asks the question: if you're a $10 million ARR business and only a few individuals have access to key SaaS metrics, what would happen if you democratized that data and made it more available to individuals across your team? So you can do that by focusing on these key areas: hiring and people operations, being the first and the second being business rhythms. So I've referenced the Traction on Demand book, which I read last year. It's a really great read, has some key frameworks that I think are interesting to implement in SaaS, and references the idea of ensuring that you have the right people in the right seats. And then also developing processes that encourage accessing and improving regular SaaS metrics. So not just in your quarterly reporting, but in your weekly sales team meetings, your leadership interactions, or even asynchronously over something like Slack. So I'll give you two examples. The first is hiring and people operations. I think that to be a category leader in SaaS, you need to hire ducks or be willing to turn fish into ducks. Which sounds like a Harry Potter reference, but it's not. Really what I mean is for key departmental roles and areas of your business that require seniority, you should expect to screen even in your hiring process or assess somehow that folks are comfortable with key concepts related to SAS math. And if not, perhaps you're hiring something a bit more junior. Can you turn someone into, yeah, a bit farther on the spectrum, right? And so ensure that you have recruiting or retention processes in your people operations department to assess and enforce comfort here. And then my last example is maybe a cheeky reference to my favorite premiership team, So sorry for those of you that aren't— I see some head shakings. I knew I was going to get shade for this, but here we are. You can establish business rhythms for using SaaS metrics for good and for growth. And you don't just need to do it at the month end. I like this scorecard because it shows that you can measure things as on track or off track for your business in a more incremental way. And so— You know, this could be any number of things. In our team, we do it for win rate. We do it for pipeline coverage. You could do it for things like activation for product team as well. And then you can just give people ownership of these metrics and look at them more regularly, especially if you can access them really easily with a hyperlink or save report, et cetera. I've also seen businesses tie compensation to some of these leading indicators. So instead of, for example, giving a head of marketing a quarterly MQL goal, what if you allowed her to experiment with a key conversion metric and over the course of a quarter improve that 10% instead of here's 300 leads, go forth. And so this is a way that you can unify and allow individuals and teams to measure and improve impact across the board. So I promise not too much talking. I had some funny graphics, I guess. But my top takeaways are this. To retain talent and to become a category leader in SaaS, I think you should think about— SaaS metrics mastery and have either the capabilities to hire for it or a willingness to train on it. You should build an intentional culture of using SaaS metrics for good and for growth, not to create fear, which I think we all too often see. Of course, the scorecard matters, but what if you could make these things empowering instead of scary? And then finally, make accessing SaaS metrics easy by building it into daily rhythms, easy to calculate, easy to understand, easy to use, analyze, et cetera. So I'm keen to hear from you all. How could you or how are you building a culture that encourages incremental SaaS metrics improvement? I will not share my screen and perhaps open it up. You're welcome to also drop things in the chat if you're not keen to come on video.

Hey Sarah, great presentation as always, my friend. What one question I had is how do you get the team members to naturally buy into this? In other words, what I'm basically trying to find out is like, what have you found to be the best? Because naturally if a team member like comes with ideas of like incrementally improving their piece of the puzzle, right? Yeah, it just moves the needle, I think, quickly because they're naturally into it. What's worked best in your experience and what hasn't worked?

Yeah, so the one thing that we've done in the last year, um, and I really like it, we— my team seems to like it as well. Some of them are probably here and they can kibosh me if they disagree, um, is we implemented a new strategy for our sales team meeting, which has a scorecard similar to the Sun scorecard that I shared. I own a number of metrics, like win rate and pipeline coverage are mine, but they also own a couple of metrics. And I think as a team, it's helpful for us to see systematically where we're failing and where we're succeeding. And so when I put up a pipeline coverage, that number that isn't high enough, we're all sort of in the same metrics improvement arena together. And it's really visual as well, which if you've got different kinds of learners or different kinds of people on your team, and that, that might be helpful. Not sure.

Sarah and everybody, Elise from UserPilot here. I think I'm coming at this maybe from kind of a different side. I'm on the customer success side, so I'm oftentimes initially not looking at the metrics that the sales team are often looking at. Though, coming from kind of the wanting to see numbers change and evolve, one of the things that we were doing on my team was asking individual team members to own, like, adoption metrics and trying to see, like, small, you know, small percentage of increase in adoption over, over time. But just because we recently started, like, collecting this data, we're not seeing really big trend lines, and I'm kind of wondering how you can really help users like our team members see increased, you know, see these numbers change even if you're looking at a small amount of time. I just started collecting this data, you know, in Q4, and so from, you know, October of last year to now, I'm only seeing like 0.2% increases or 0.4, but how do I kind of continue to encourage my team to push towards those better adoption rates and things like that?

Yeah. So I would say two things, and thanks for the question. Firstly, I would be wary of benchmarking yourself and your team against a lot of other things that you see out there. It's tempting, especially when you don't have a ton of data. But it can also be incredibly misleading. And the metrics matter, right? But you can also look for— you can also look for qualitative indicators. And you can sort of look at small incremental things. And then you can look at customer stories sort of across the board. But yeah, I mean, it's hard to say. I think it's funny. I put that slide on the— I put that slide at the beginning of the presentation, a 10% improvement from SQL to SAL. And then I felt guilty because a 10% improvement actually feels not small. Not small. But I think the idea is that every incremental improvement helps, especially if you can keep it on the up and up. I think Steve might have an idea here.

Yeah, thanks, Sarah. And hi, everyone. Kind of following up Poya's question, how do you see this being challenging, or how do you overcome challenges getting this implemented? From like the C-level or the founding level. And speaking from experience in my last leadership role, I used to bring in quite a bit of not only ChartMogul data, but some other leading indicators I could pull from CRM, et cetera. But it took a lot of time for the buy-in on the user level, as well as from my leader, which was saying, hey, why are we paying attention to these? I don't really see it in the, KPI that we really care about.

And if I may ask, is the KPI like an outcome metric, like ARR?

Exactly. Especially for early stage, right? Where everything's so like revenue, revenue, revenue. Trying to shift the focus to leading indicators of that was a bit of a challenge.

Yeah. I mean, to some extent, right? You can't make people care necessarily about things that aren't of interest to them. So, so it's interesting, like, I forecast MRR, like, to the best of my ability, in a monthly or quarterly fashion. And some of it I just do for myself, like, for my own diagnostics, and for my own sort of process improvement and for our team collaboration within sales and marketing. And I think you always have to be a bit choosy, especially if you are putting yourself out there, putting your metrics out there, and then maybe folks, it feels like they're falling on deaf ears. And so, yeah, maybe there's a different way to sort of orient the conversation, or maybe you just do it regularly or periodically for yourself to sort of then refocus your own efforts. But that's just my experience.

We've got time for one or two more questions if anyone has any.

All right, I'll jump in. I hate being that guy that keeps going, but Sarah, you sit on so much data, or at least you have so much visibility in your role, right? At ChartMogul. What are some trends that excite you about what's going on in SaaS and cloud and tech, just based on some of the trends that you're seeing, let's say for the next 12 months?

The thing that I'm like nerdily obsessed about right now, if I can say that, is SaaS for things that I haven't seen SaaS for, or SaaS for the people that deserve SaaS a little bit. Like there's a part of me that is so tired about SaaS for sales and marketing. Like if I get hammered with like any more marketing automation stuff, I don't know. I won't lose my mind. But I'm excited to see SAS for other things—SAS for scientists, for educators, for manufacturers, for construction workers. That really amps me up because I think SAS is—we benefit from this experience of logging into software that is just so friendly and makes our lives better. And other people deserve that too. So that's kind of what I have my eye on.

I just came up with a new game. Every time someone says SAS, everybody take a drink moving forward throughout today.

It's 7 here, and I smell dinner. Well, this has been fun. If there's nothing else, I will wish you all a fabulous rest of day. And yeah, feel free to reach out, sarah@chartmogul.com anytime, and we can chat further.

Awesome. Sarah, thank you so much for joining us and interrupting your dinner time. We really appreciate it. No, everyone, thank you so much for joining. Be sure to check out other sessions that are happening all day throughout the— throughout the day in the link that I shared in the chat. Thank you so much, Sarah.