Raising Saas Success Rates

Just a few days ago I was watching the unveiling of the new Tesla Model 3 and one of the things that Elon Musk presented resonated with me and how we build Atcore owner Saas solutions.

Musk was presenting the iterations of cars and said that the roadster was high price and low volume, the Model S was much the same. Both were required in order to get to low price, high volume with the Model 3. The first two provided the finances and the knowledge to build the third.

Our software starts off much the same way. We get requests to build various features and verticals through consulting engagements. After we have built them multiple times in many variations, we determine if it would be a good product. Then we use the knowledge that we gained on each project to build a product that other organizations would need and want.

I believe that part of the reason that Saas failure rates are so high is because everyone wants to jump to the Model 3. Their investors tell them that it has to be a pure play, no consulting on the books. However, consulting with focus and a paid education is not a bad route to take. It is when consulting gets out of hand and is done for revenue sake instead of to develop then end product that it becomes an issue. What routes other than the pure play have you taken to build a success Saas company?

 

The Necker Effect

There are certain events in life that completely change your outlook on the world as you perceive it. Over the years I have had only a few of these events, but each one was truly profound.  On December 13, 2014, I flew out of Hartsfield-Jackson and headed to Necker Island to spend time with some amazing entrepreneurs and Sir Richard Branson. The trip truly changed my outlook in many ways and I have pages of notes that I would like to share with the world, over time. For now, there are too many for one post.

One thing that I found amazing was how it affected everyone before, during and after the trip. The experience was more than I can put into words, but you could tell that for many individuals, the trip had changed them. They were more ambitious, more driven, more at peace. Pick the positive change and it was likely to have taken place on that island.

Here are a few of the moments when I knew everything had changed.

Conversation 1: An entrepreneur and I are standing on the beach watching a few people take kitesurfing lessons on the last full day of the trip.

Richard Branson Kitesurfing

Entrepreneur 1: “Guess today is the last day to take it all in.”

Me: “Yes it is, then we go back to reality.”

Entrepreneur 1: “Yes we do.”

Me: “Wait…. We get back to our reality; this is apparently someone’s reality. I guess we just need to change ours.”

Conversation 2: In a hot tub watching shooting stars at the highest point of Necker Island.

Necker Island Hot Tub

Entrepreneur 2: “What changes when you get back home?”

Me: “I think a lot will change, (pause while thinking), what changes for you when you get back?”

Entrepreneur 2: “Everything has already changed.”

Then we proceed into all the things that have changed and will change in the coming months.

It is difficult to capture these moments into words, but the feelings and pauses in the moment ensured that you knew life was going to be different. Or, that it already was.

What trips have you taken that changed your outlook in a profound way?

Recurring Dinner for Relationship Building

Yesterday I met with two other entrepreneurs and we got on the topic of relationship building. The core of the topic was about how we utilized events like sports games and other outings in order to build stronger relationships with employees, customers and friends.

One strategy came up that I had never heard about which I found interesting. One entrepreneur would go to the same local steak house on the same day of the week, every week of the year. He would tell friends, coworkers, prospects and others that he would be there from X time to Y time and that they should drop in and join him at his booth.

This sounded like huge time commitment but an amazing way to connect for some of the following reasons:

  1. You get to connect with people each week.
  2. The people who join in get to meet new people which provides additional value.
  3. It is unique and memorable.

What other unique strategies have you utilized to build relationships?

Knowing You Have the Right Team

Building the right team is perhaps one of the biggest challenges an entrepreneur could face. It is also one of the most rewarding. Seeing people grow and knowing that you helped them get to the next level whether inside or outside of the company is a profound experience. But how do you truly know when you have built the right team?

Simple. When you can leave for an extended period of time and not step in, no matter what happens. For me, this is extremely difficult to do because I am a workaholic. Even if I don’t step in I still want to know what is happening. This past December I got the chance to go to Necker Island for a week to spend time with other EO’ers, Entrepreneurs and Sir Richard Branson. It was truly a life changing experience and one of the takeaways was that I had built the right team.

While away and refusing to work, here are some things that happened.

  1. Leads came to me directly and were taken care of without my intervention.
  2. An important customer had a high priority issue that was managed.
  3. Business went on and the team took care of everything!

These few highlights don’t do justice to what transpired or what it truly meant so let me pose two important questions.

If an important email came directly to your inbox and you couldn’t respond for a week, would it be taken care of?

If your top customer had a major issue and you couldn’t get on the phone or respond, could your team take care of it?

 

Process Creates Clarity and Repeatability

In a past life, at large corporations, I absolutely hated processes. The main reason was that processes in that environment seemed to have steps for everything that had gone wrong one time in the past. They didn’t create clarity, repeatability and weren’t used for training.

After receiving process training from Jim Ryerson via EO I came to love and enjoy mapping out the processes that we used. Why? They created clarity, repeatability and were used for training.

  1. Clarity – Our processes are written with a very high level of detail. These aren’t your typical 30 thousand foot management processes with lines going everywhere, these are processes that tell you every step and explain why the step is there.
  2. Repeatability – Having a fully documented process on various jobs, tasks and functions ensure that we can repeat it over and over. The process can act like a checklist where nothing is left out or forgotten.
  3. Training – Perhaps the best thing about having a written, detailed Visio of your process is the ability to use it for training. Whether you are training a new employee or updating staff, it is easy to pull out the Visio and walk through each step to ensure they understand, who, what, why and how things get completed.

One of our best sales training documents is a Visio diagram that outlines how leads come in and goes all the way through delivery to payment and collections.


What other benefits have you seen from have detailed process documents?

A ‘Pick Up The Phone’ Culture

A few years ago I wrote about Being a Confirmation Emailer which outlined how helpful it is just to let people know that you received their email. Confirming email receipt and responding to emails in a timely manner helps to provide great service. Unfortunately our culture seems to have started using emails to go back and forth on minute items, when a phone call would have been best. Instead of this back and forth, we should just pick up the phone and connect as humans.

I believe that in the future, the companies that promote a ‘pick up the phone’ culture will have greater success and customer loyalty than those that don’t. I have recently experienced a situation that exemplified this perfectly..

I was working next to a salesperson who was working a deal and had received an email with questions from one of their prospective customers.

The following events then ensued:

  • He did not immediately respond to the email, as this would have been impersonal.

  • He picked up the phone to call and answer questions live.

  • When the voicemail picked up, he left a message letting the prospect know that he was calling to answer his question.

  • Then he followed up with answers in an email.

If the prospect would have answered the phone during the initial call, the salesperson would have answered the questions and still followed up with an email recap. Now that is service!

One place that this problem seems to be running rampant these days is in support and I will be the first to admit this offense. A common practice for companies that require you to purchase separate support packages is that they will provide their customers with a phone number to call them. However, it means that they will not conduct any outbound calling to respond to or follow up with these issues. Simply put, if you don’t purchase their support upfront, you are out of luck.

Lets clarify what phone support should mean… I can call you to open a support ticket and get help when needed, including a friendly and helpful phone call if that makes the most sense. It doesn’t mean that when I file a ticket through your portal, that you only email me and can’t call me. If a quick phone call would address the issue rather than spending an hour going back and forth through email, then that’s what should be included in the solution.

It is my goal to personally do better about picking up the phone and making a real connection. It is also my goal to build that culture into the organizations that I manage. Do you pick up the phone and dial?

 

Business Discovery Process

The customer discovery process has taken hold and the future entrepreneurial leaders are using it to learn more rapidly than ever. In programs like Flashpoint and StartupGauntlet, entrepreneurs interview hundreds of people to hone their product and vision. Through these programs, they are getting out of their bubble and getting real data. Next, they need to do it for the business.

In speaking with startup entrepreneurs, I hear many common threads that create various concerns about viability. A few examples I commonly see and hear are:

1. The entrepreneur is going to grow the business using social media.

A few questions to this assumption would be:

  • How many Twitter followers turn into a customer?

  • How many Facebook likes turn into a customer?

  • How many leads come in from a large social media campaign?

  • Have you ever run a social media campaign?

2. The projected revenue numbers are made up or based on what the entrepreneur needs them to be.

Lets say that you are starting a brick and mortar shop:

  • What is the revenue of other businesses that are exactly like yours?

  • What is the revenue of other business similar in footprint, pricing and nearby where your store is or will go?

Just like with customer discovery, in business discovery it is important to come up with multiple hypotheses, then go out and get real data to prove or disprove it. Do you have a business discovery process?

Mentors and Mentees

A few nights ago I attended the FourAthens mentor panel which was a great discussion around what mentors are, do, and are looking for in mentees. The panel also included a few mentees that provided experiences as well as their thoughts on the mentor/mentee relationship.

Here are a few takeaways:

  • Mentors are there to mentor the person and not the business.

  • Advisors mentor the business.

  • Mentors should be willing to open the rolodex.

  • Mentors have different styles so find the one that works for you.

Mentee no-no’s:

  • Don’t ask mentors to get on sales calls, make documents or “work” your business.

  • It is ok the ask for advice in the mentors area of work but don’t treat them like a consultant.

  • Don’t be closed minded, you are supposed to have hard conversations.

As entrepreneurs we are always learning and growing. Once we are enlightened in one area we find out that there is just as much to learn in another area. This is why I enjoyed what I consider the quote of the night. Being a first time entrepreneur is a “Fog of Unknowing”.

The final take away from the meeting was that most mentees are looking for three types of relationships or assistance. They are mentors, advisors and consultants. The mentor and mentee need to agree on which role is being filled, up front, to ensure a good working relationship.

Losing Your Number One Source Of

I recently read an article from one of my favorite local professional bloggers that wrote about diversifying income streams. In the article he posed a very important question which was “If my #1 source of income was gone tomorrow…. what would I have left?”

This struck me as a pretty powerful thought and exercise. If my #1 ___________ was gone tomorrow…….. what would I have left? The next question is, what would I do? Planning for disaster isn’t a fun task and takes a lot of deep thought. Unfortunately this type of planning and exercise doesn’t happen enough in businesses.

Here are a few questions that I asked myself:

What if my top engineer left tomorrow?

What if my top top salesperson left?

What if my #1 business revenue stream was somehow cut off?

What if my best strategic partner went out of business?

Have you asked yourself these questions lately?

These loses could be devastating to many businesses. In fact, there was a time when this would have been totally catastrophic to my own business.

Yes, now it would be a huge blow to lose some of my key people. We are somewhat of a family and we work well together, but that does not mean that I am blind to the fact that they are talented and someday they may choose to move on. This is reality in today’s business world.

The one thing I and many successful business people I know do to lighten the blow when this does happen, is to always look for new talent.

Building relationships with quality people in all avenues of your business will allow you a pool of people to pick from when a position does open up. It is much easier to ask somebody you know, and know their work, to come work for you than to hope the right person comes your way after a position opens. Networking is the key to keeping the candidate pool full at all times.

Obviously you don’t want to live your life or run your business based on fear but you should be asking yourself the hard questions and planning accordingly.

Selling Value and Trash Service

About a week ago my wife received a call from a trash company that was trying to gain more customers in our area. They offered to provide the same service that we were currently receiving but at a lower price and with an additional large trash can for recyclables. Although we weren’t really looking to switch companies we would be getting more value at a lower price so we accepted their offer.

After that call we had to call the current trash company to cancel our service and apparently the person on the other end of the phone was not happy about our switch. She proceeded to tell my wife that this was a bad decision, that this was a large company pushing little companies out of business and that we would regret when we pay fuel surcharges at a later point. These were all good points and needed attention but that is not the point of the post.

What it really comes down to is selling value on what many would consider a commodity. Following the recap from my wife I thought to myself, how did this smaller and likely more agile company prove their value while we had the service and would that have kept us from switching?

The fact is that the savings were minimal and the extra can, for times of need, was a bonus. This means that a little more value from the original company would have easily kept us from switching. This begs the question; “What value could they have provided, this is just trash service, right?”

They could have done any of the following things:

1. Called me at a regular interval to make sure we were satisfied with the service.

2. Called occasionally to make sure our trash cans get put back in the right place and aren’t laying in the street after service.

3. Offered to get our trash cans if they weren’t at the curb on trash day ( how many times have you forgotten to get the trash up? )

4. Offered one emergency pickup a quarter. This would be great after entertaining guests.

5. Given me a tight time range that they would show up each week in case I forgot to get it out the night before. I could then know if they had gone by already or not.

I am sure that there a many other ways this company could have provided value which would have kept me from switching, but they didn’t.

What are you doing to provide more value than you competitors? Are there things you know that you should be doing but haven’t had the time to do?