SaaStr

SEPTEMBER 21, 2023

That works for a while, but you end up with not enough headcount if you do freeze hiring but still want to grow. More on this in our deep dive with co-CEO Eran Zinman: You can’t grow forever with no growth in headcount. But we’re lapping tougher times for many, and for many others, it’s just plain time to hire again.

Sales Hiring 275

Sales Hiring Headcount Scale Cloud 275

SaaStr

FEBRUARY 18, 2022

Sales-driven SaaS startups end up with about half their headcount in sales and marketing. 2x the sales headcount you thought you did to hit the full plan for this year, and Q1 of next year. It sounds high at first, until you realize that's just how the math works. Software itself and other departments get leverage.

Scale 333

Scale Sales Hiring Scaling Headcount 333

SaaStr

MAY 24, 2023

At least in the short term, it is turning most of us can do more with about the same headcount in SaaS. #4. Headcount Growing, But Slowly. Staying basically flat in headcount for 3 quarters while growing a stunning 50% (!) They got there, in fact, two years ahead of schedule. 47% Of Revenue Outside the U.S.,

Headcount 278

Headcount Sales Hiring Scale Cloud 278

TurnKey Labs

OCTOBER 4, 2023

Effectively managing labor costs is a critical concern for businesses aiming to maintain financial stability and competitiveness. However, the challenge lies in finding ways to reduce expenses without resorting to employee layoffs, which can have adverse effects on employee morale and productivity.

Headcount 57

Headcount Strategy Management Business 57

SaaStr

MAY 30, 2023

And very few of you are doubling headcount, vs everyone in 2021. Hiring has way slowed down, but many folks are still hiring, albeit at a reduced rate. 56% of you aren’t hiring, or barely hiring. But a good chunk of you are still hiring, albeit in moderation. This is what we are starting to see across public SaaS leaders as well.

Sales Hiring 219

Sales Hiring Headcount Engineering Revenue 219

SaaStr

SEPTEMBER 19, 2023

Some of the changes we’ve seen in the last year or two include: CAC reduction Headcount optimization Price complexity Quality of revenue A different environment means a different strategy, and Notion Capital lays out four business model changes that could be helpful based on what peers are doing. You don’t want to be there.

Business Model 238

Business Model SaaS Payments Payments Headcount 238

SaaStr

AUGUST 18, 2023

Yes many public SaaS companies have done some sort of layoffs the past 12 months, they were often more really reorgs, though, without any net decrease in headcount. The key was “simply” keeping headcount flat. #3. Everyone is basically doing more with not much more headcount. Without really sacrificing growth.

Scale 188

Scale Headcount Point of Sale SaaS 188

SaaStr

NOVEMBER 18, 2022

There is almost no software and non-headcount budget for CS. 64% of CS teams spend $200,000 or less a year on non-headcount, with growth stage companies spending the least, just 0.1% I generally see CS reporting to a CRO as a recipe for conflicts, but sometimes it’s the best option: #2. This data is interesting. of revenue.

Customer Success 290

Customer Success Headcount Churn Revenue 290

SaaStr

MAY 31, 2023

Everyone is basically doing more with not much more headcount (see next point). #4. Growing Headcount, But Much More Slowly That Revenue. Headcount is up 29% year-over-year, but revenue is up 50%. Also you can see sales & marketing headcount is basically flat, while hiring is almost all in engineering / R&D.

Headcount 191

Headcount Scale Sales Hiring AWS 191

SaaStr

NOVEMBER 22, 2023

Freezing Headcount is How They Got So Much More Efficient Again, a common story. But for now, AppFolio is staying leaner, with less headcount this year than last — despite impressive +29% growth. #4. Many that did are now re-hiring, from Monday to Salesforce and more.

Payment Services 227

Payment Services Payment Solutions SaaS Payments Payments 227

Tom Tunguz

OCTOBER 31, 2023

AI Efficiency Gains +2% Headcount Reduction ? Headcount reductions in the last year, which impacted every company, should increase the pipeline coverage ratios for the remaining team members. All of these technologies are still nascent & imperfect, but they should improve through the course of the year.

Headcount 201

Headcount Sales Hiring AI Cloud 201

Tom Tunguz

MARCH 27, 2023

The antidote: greater pipeline-to-quota coverage ratios by either increasing the top of the funnel or reducing the account executive headcount. These benchmarks suggest startups should plan on materially longer sales cycles into 2023. The data analysis uses the results from the 2023 GTM Survey.

Startup 336

Startup SMB Headcount Sales 336

OpenView Labs

OCTOBER 2, 2019

Headcount Planning. But headcount planning is often a useful place to start because the inputs required to make decisions are the least dependent on factors outside of the sales organization. This decision will drive many of your other headcount decisions. What ratio do you want between AEs and other sales roles?

Headcount 41

Headcount Sales Hiring Scale Sales 41

SaaStr

AUGUST 1, 2023

But this time, instead of headcount, it was apps. Yes, some bigger companies went through layoffs too, but in many cases, they hired more folks back, and really just kept headcount flat or slowed its growth. You get all the VPs into a room, and you tell them to make a list. Of the 10% to cut. Apps though they truly cut.

Headcount 201

Headcount Finance Cloud Startup 201

SaaStr

MARCH 20, 2024

Do you have to double your headcount to make it from $10M to $20M or even $2M to $5M? For headcount specifically, make sure that the constraint to growing faster is that you don’t have enough salespeople to work the demand that exists for your business. When those outcomes are achieved, the hire gets their headcount.

Sales Hiring 245

Sales Hiring Sales Recruiting Scale Headcount 245

SaaStr

JANUARY 4, 2023

Slowing headcount growth — like lots of others. Okta headcount grew 32% year-over-year, fairly consistent with revenue growth, but then Okta like others slowed down hiring. Okta is seeing higher SMB churn and more ROI scrutiny, but is also benefitting from some customers wanting to centralize on fewer core vendors.

Scale 274

Scale Headcount Sales Hiring SMB 274

Tom Tunguz

DECEMBER 17, 2023

Like the Devops movement, the Dataops movement aims to scale the use of data within companies without increasing the headcount of the data team. On December 14th we welcomed Philip Zelitchenko , VP of Data from ZoomInfo, to talk about how he has built this discipline within his team & it was fascinating. The video is here.

Data 240

Data Government Scale Headcount 240

SaaStr

MAY 10, 2023

At the end of the day, in SaaS, efficiency really comes from growing revenue faster than headcount. Almost everyone is doing more with … yes, more headcount, but only a smidge more. Revenue Up 30%, but Employee Count Only up 10%, to 7,055. Salaries and comp are the vast majority of expenses. Including HubSpot. #4.

Scale 245

Scale SMB Headcount New CTO 245

SaaStr

NOVEMBER 16, 2022

Like many tech companies, Monday added a ton of headcount in 2021. It then added only 63 employees last quarter, and plans to continue with very slow headcount for a while. Another reminder to go global in SaaS as early as you can! #10. Slowing hiring has been key to driving up free cash flow.

Headcount 282

Headcount SMB Engineering Scaling 282

Tom Tunguz

JANUARY 22, 2023

B2B companies have reduced headcount to a greater extent than at any time since 2020. The current wave of layoffs, a difficult component of the innovation boom/bust cycle, differs from the previous years’ dynamics. In the last three years, B2C startups’ ratio of layoffs have dwarfed B2B layoffs. In 2020, B2C companies cut 8.8x

B2C 299

B2C B2B Headcount Innovation 299

SaaStr

FEBRUARY 19, 2024

Unlike building a product team, there is no efficiency when building a sales org: half of your headcount will be in sales at $10m, $50m, or $100m in revenue. This regular interaction ensures that both teams are aligned on priorities and helps prevent last-minute disruptions. This means building a sales org requires a different approach.

Sales Hiring 239

Sales Hiring Scale Sales Headcount 239

SaaStr

JULY 29, 2023

A classic and great deep dive in terms of how to scale your teams, headcount, and orgs: #2. In advance of that, we wanted to take a look at a few of David’s classic sessions from SaaStr Annuals past: #1. The SaaS Org Chart by Series with David Sacks, Co-founder and General Partner at Craft Ventures.

Headcount 213

Headcount Startup Scaling SaaS 213

Tom Tunguz

APRIL 5, 2020

But starting that week, startups began reducing headcount by about 700 per day. ClassPass, one of the fitness startups to reduce headcount, reported a 95% drop in sales in 10 days. Over the weekend, I analyzed Roger’s data to answer this question. First, let’s look at layoffs by day. Friday spike to more than 1800.

Sales Recruiting 340

Sales Recruiting Startup Headcount Sales Hiring 340

Sales Hacker

JULY 24, 2018

Decreased revenue per rep, High turnover as you scale headcount. We made our machine more efficient even as we scaled, grew headcount, and skyrocketed our revenue. In the first six months of the year, our team’s headcount grew by almost 60%, yet our revenue outpaced that, growing by 142%.

Scale 55

Scale Headcount Sales Hiring Scaling 55

Tom Tunguz

JUNE 25, 2020

Marketing teams spend 5-10% of ARR on programs (non-headcount expenses), and this is pretty consistent across ARR. Engineering:Account Executive headcount ratios scale from about 3:1 down to 1:1 as a company scales revenue. Most sales teams ramp AEs (both inside and outside) on six month time periods. This was surprisingly low.

Scale 364

Scale Headcount Benchmarks Retention 364

SaaStr

MARCH 8, 2023

Don’t Tie Revenue To Headcount “You want to get away from a business model where every incremental dollar requires incremental hiring,” says Deatsch. So instead of focusing on scaling headcount quickly, work toward growing revenue quickly.

Sales Hiring 211

Sales Hiring Enterprise Headcount Scale 211

Intercom, Inc.

AUGUST 11, 2022

And they’ll be able to do this efficiently, without increasing headcount or hours logged. Of course, we’re acutely aware that many businesses are operating with less headcount, resources, and bandwidth than before so we narrowed down our advice to the five essentials for driving true bottom-line impact.

Headcount 237

Headcount Customer Support Strategy Branding 237

SaaStr

MAY 12, 2021

But in theory, higher quotas should “pay” for specialization so in theory, this won’t impact headcount too much. But in practice it often adds 20% or so to the headcount in the model. Fifth, the more specialized the sales process is, the more folks you’ll need. SDRs, BDRs, etc. 2 Managers. = 22 heads /.75

Scale 299

Scale Sales Hiring Headcount Sales 299

SaaStr

JANUARY 30, 2024

They did layoffs and froze headcount. That they had to get to cash-flow positive, because no more money was coming. And while many couldn’t pull it off, and will go under, a lot actually got there. They cut marketing spend to $0. They raised prices. So now they are, in essence, NRR Zombies.

Headcount 213

Headcount Finance Startup Trends 213

Tom Tunguz

DECEMBER 6, 2022

Sales-lead teams cut headcount when account executives don’t attain numbers. Some about the data: PLG companies R&D spend hasn’t produced new business at the same rate as a dollar invested in sales & marketing post-Covid. Engineering teams do this to a lesser extent.

Headcount 317

Headcount Market Research Acquisition Education 317

Tom Tunguz

NOVEMBER 29, 2022

Napoleon’s March encodes 6 : the geography of the terrain, the route & the direction of the army, the headcount of the troops, the temperature of the battlefield, & the time of year of Napoleon’s doomed quest to conquer Russia. ” Most visualizations plot 2 dimensions. Click to enlarge it.

Data 265

Data Headcount Data Analysis 265

SaaStr

SEPTEMBER 13, 2023

Keeping headcount flat got everyone to be more efficient. Adding Back Sales Capacity Now. I.e., Hiring More Reps. This is a theme we’ll see accelerate the coming months and year. Salesforce also just announced its accelerating hiring again. But you can be too efficient in sales. Samsara is scaling up sales faster now again.

Sales Hiring 228

Sales Hiring Scale Headcount Engineering 228

Tom Tunguz

JULY 21, 2022

Management teams expect to reduce operating expense by 20% predominantly through headcount reductions or hiring freezes - everyone from sardine startups to public megalodons. Software automates manual work, provides leverage, and the total cost is often less than a headcount. Software does more with less.

Sales Hiring 157

Sales Hiring Headcount Software Finance 157

Tom Tunguz

DECEMBER 31, 2023

Companies & startups in particular begin to report meaningful improvements in productivity from AI, reducing their headcount growth, butn growing revenue just as much as projected. ARR per employee increases 10%, twice the decade long average.

AI Search 238

AI Search AI Scale Headcount 238

SaaStr

SEPTEMBER 14, 2023

The headcount and other ongoing operating costs do add to expenses and hit earnings, however. If the acquisition fails years down the road, that Goodwill may need to be written off, and impact earnings for a quarter as a one-time expense. But even there, it’s years later, and a one-off expense.

Acquisition 228

Acquisition Investment Headcount Banking 228

SaaStr

MARCH 1, 2022

Headcount up 7%, while revenue is up 37%. But that only increases total headcount 7% which revenues went up 37%. That transition doesn’t happen overnight for legacy customers. 30% of their revenues are still from customers running Jira and friends on their own servers. But it’s now finally in decline, shrinking 12%. #5.

Scale 286

Scale Marketplace as a Service Headcount Cloud 286

Clouded Judgement

APRIL 6, 2023

That’s a big difference, especially when you layer in the growth in headcount from 2021 to 2022. Essentially companies grew headcount significantly to add less ARR. We’re obviously seeing the rightsizing of this now with headcount reductions. The second chart comes from the latest MS CIO survey (below).

Cloud 130

Cloud Headcount Subscription Payment Features 130