Annual Planning for Sales Organizations: Headcount, Quotas & Territories

OpenView Labs

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. Marketing bookings are often the most difficult to scale with headcount, as “low-hanging fruit” may already be captured by current marketing efforts, and additional paid digital advertising, content marketing, etc.

5 Ways to Keep Your Sales Machine Efficient While Scaling Headcount

Sales Hacker

Decreased revenue per rep, High turnover as you scale headcount. “It’s 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%. The post 5 Ways to Keep Your Sales Machine Efficient While Scaling Headcount appeared first on Sales Hacker.

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How Quickly Does Headcount Scale in the Fastest Growing Software Businesses?

Tomasz Tunguz

Above, I’ve charted the headcount growth rate for 10 of the fastest growing software companies in recent history. I’ve normalized the years for when all the businesses were roughly at the same headcount - fewer than 50 people. What does the “average” hyper growth software company look like in terms of headcount growth? How quickly do the fastest growing software companies build their teams? The answer is incredibly quickly.

Why do all the tech giants rely on “shadow forces” of temporary employees?


But let me suggest one reason I learned when I was an exec in a F500 tech company: Headcount was most fixed for a year. Our group had a fixed headcount of about 800 to manage about $800m in revenue. Getting even a single additional headcount was incredibly difficult. Especially allocated headcount. Even if your “headcount” is fixed, capped and frozen. There are probably a multitude of reasons.

Transforming Traditional Revenue Operations to Drive Growth


They’re experiencing billing disputes and mushrooming headcount in sales operations, and a growing reliance upon manual work arounds in Excel® or email. By: Peter Getchell, EVP, ERP Practice, Navint We talk with many CFOs, CROs, and CEOs who are frustrated by the internal friction their teams experience in day-to-day business operations. In many cases these symptoms perplexingly persist even after. Source. Insight

[SaaStock Latam special]: How Superlógica grew 10x by improving pricing plans


In the last three years, it has grown from 60 to 225 in headcount, 10x in revenue and now serves 4 different verticals. Tune in for an extra bonus episode of the podcast, hosting SaaStock LatAm speaker André Baldini, CEO of Superlógica who tell us how the company grew revenue 10x. Superlógica was started back in 2001 as an ERP software for condominiums. André Baldini started out as VP of Sales In 2017 he was promoted to CEO.

The Startup Sectors Most Impacted by the Coronavirus

Tomasz Tunguz

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. Which startup sectors are most affected by coronavirus? Roger Lee is maintaining , which is a table of all the startups who have unfortunately cut staff. On the brighter side, it is a resource for startups looking to hire as they grow.

What are some of the most overlooked details or challenges when integrating two companies post-acquisition?


Because headcount is often fixed in BigCos. Because overall headcount might be fixed at say 15,000. Q: What are some of the most overlooked details or challenges when integrating two companies post-acquisition? I can make a long list of challenges and overlooked details in acquisitions, but I think they all stem from 1 issue: not being honest about what things will look like in 24 months: Does the CEO really want to stay?

At About $2m in ARR, Every Great Hire Will Be Accretive.


No headcount limits. Who should you hire, with limited budget? A VP of Sales? A Director of Demand Gen? Or A Head of Product? The answer is Yes. A truly great hire is >always< accretive. At least within just a few months. Hire anyone truly great you can find. Find a way.

Top 10 Learnings from the Redpoint 2020 GTM Survey

Tomasz Tunguz

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. Yesterday, we shared the Top 10 Learnings from the 2020 Redpoint GTM Survey at SaaS Office Hours. The presentation is embedded below.

Why Financial Modeling Is Like A Superpower


adding headcount, reducing production time, expanding sales territories) to see likely outcomes. Robust models should let you model everything, everywhere—expenses, capital, headcount, revenue, projects, grants, quotas, and territories—across any department, entity, or function.

Q2 compared to Q1:  What are the trends for SaaS?


Employee productivity is up for the moment, as companies reduced headcount. We are currently conducting a 2020 Flash for the SaaS benchmarking community, looking at 2020 end of year forecasts for revenue, ARR, growth rates, and departmental expenses and headcount.

8 Finance Mistakes Growing SaaS Businesses Make and How to Fix Them


This INCLUDES headcount-related expenses. If you are utilizing Gusto or a similar payroll tool, your headcount expenses are likely coming into your P&L as one (or maybe two) line item(s). these figures are going to be WRONG because you haven’t properly accounted for your headcount costs in Sales & Marketing.

Your Sales Year is Coming to an End. Are you ready?


If you have open headcount for Q1 be interviewing in Q4. Behind headcount equals behind plan. It’s two weeks until December. Holiday music is already playing in every store you set foot into, your weekends are starting to fill with egg-nog and apple pie induced festivities and every morning you find yourself layering up with an extra hat or scarf before you step outside. Tis’ the season! December around the corner also means your sales year is coming to an end.

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What is the Structure of the Typical SaaS Company as it Scales?

Tomasz Tunguz

We can derive the table above if we look over the entire respondent base and bucket headcount by ARR. This post is part of a series leading up to SaaS Office GTM Edition on June 24 in which we’re reviewing the results of the 2020 Redpoint GTM survey. Today, we’re answering the question: how do teams grow as a startup scales? The median startup with between 1-5M in ARR will have 12 engineers, 6 in sales and 3 in marketing.

1 Key SaaS Sales Metric to Fine-Tune Sales Productivity


At the highest level, SaaS companies look at sales expense, headcount, sales productivity and SaaS metrics like: The cost of new customer acquisition (CAC). Sales is the Growth Engine. Sales is the engine driving SaaS company value. Top and bottom line performance are totally dependent on the sales organization and its performance. And sales expense is typically the largest expense item on a growth SaaS company’s income statement.

Why Self-Service and Product-Led Growth Won’t Replace Sales [Opinion]

Sales Hacker

Sales still makes up 25% of their headcount on average. Sales and business development headcount increased by 45% year-on-year versus just 33% in non-sales roles (the full data is available here ). Flash forward to 2019, and the company grew sales headcount by 66% year-on-year, which is twice the rate of other roles (31%). Many of today’s fastest-growing software companies have something in common — their products can sell themselves.

Why Startups Should Establish Qualifying Signals for Sales Teams Early On

Tomasz Tunguz

Massive headcount growth presages large software purchases and expansion. Demand generation limits growth. To scale, a company must find customers in ever larger numbers. The ideal scenario is one where purely external signals confer a prospect’s propensity to buy. A prospect experiences hypergrowth is perfect example. A company anoints a new department head catalyzing change. The more external the signal of lead quality, the easier the demand generation task will be.

How to Improve Sales Forecasting with AI


It enables your company to set a budget, make headcount decisions, fund marketing and product investments, determine expansion timelines and much more. Most companies miss the mark when it comes to sales forecasting — in more ways than you think. The chronic inaccuracy of sales forecasting is well-documented by SiriusDecisions , noting that nearly 80% of sales organizations miss their mark by more than 10%.

As Long As You Are Growing 60% Or More — Your Competition Can’t Really Hurt You


And they have five times the headcount and have raised $25 million. (Note; an update of a classic SaaStr post, with 2020+ learnings.). A little while ago, I Zoomed with a good friend running a SaaS company doing about $4 million in ARR. A really good SaaS company. And he was beside himself. First, he was just plain exhausted. He was in that zone from $1 to $10m in ARR when it all just gets so hard. Too much to do with too few people. We’ve talked about how The Cavalry Was Coming.

SaaS Financial Plan 2.0

The Angel VC

If you have a SaaS startup with a higher-touch sales model where revenue growth is largely driven by sales headcount, the plan needs to be modified accordingly. Costs" tab In order to adjust headcount planning in the G&A, R&D and marketing departments, change the assumptions for start date, base salary and bonus in the grey "Assumptions" area.

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The Competition You Always Have: Headspace and Budget


Not that much given the overall headcount I nominally had assigned to me. A common VC-ism is that You Always Have Competition. This probably is mostly true, especially since 70% of the top SaaS companies are really just new versions of old, established categories. About 70% of SaaS Unicorns Are New Versions of Existing Categories of Software. But sometimes, you really are something new. Or so different, that it’s basically new.

If You Want to Hit The ’20 Plan … You Gotta Be Making the Hires Now


With precise headcount and budget needs. A few seasons back, we wrote a post on hitting how in SaaS, you have to be putting the resources in place by Q3 to hit the plan for the next year. We update this post a bit annually as we head into next year’s planning procress. I still see most startups way behind on their 2020 planning, and most importantly, hiring, at this point in the year. I’m not sure we’ve gotten that much better at our resource planning in SaaS.

5 SaaS Metrics You’re Calculating Incorrectly 


They had to take out 7-8 headcount in order to get their burn rate down. 5 SaaS Metrics You’re Calculating Incorrectly . SaaS metrics : the performance indicators that startups love to hate. Whether you’re the CEO or an analyst at your company, SaaS metrics play a huge role in your day to day.

We Haven’t Hit Peak SaaS


In 2014, Mixpanel’s Series B pitch deck spelled out the company’s expansion plans over the next two years: 3x sales headcount and rapidly race towards distribution. Double headcount every 6-9 months. Reduce sales ramp time by 30-50% via sales enablement. Double down on marketing to widen our lead flow to lower cost per acq. long-term. They raised $65 million dollars with that plan.

Observations about Silicon Valley Two Weeks into Quarantine

Tomasz Tunguz

The rule says that all employees of affiliated companies must be considered headcount. What’s going on in Startupland? Venture rounds are closing. We’ve seen seeds, As, Bs, and growth rounds in the past few weeks. And round announcements continue. Valuations are coming down a bit, but they are all over the map. It’s too early to draw any conclusions about pacing, however. In fundraising conversations, founders are candid.

CIOs from LogMeIn, Vonage and More Share How Their Role Has Changed in the Downturn

OpenView Labs

“In any downtown, a leader has a number of tools at their disposal to maintain the health of the organization and keep costs under control if needed: Headcount, programs, automation, discretionary spend and others. Headcount reductions form that one-way door, since the exit of great talent can take months, if not years, to recover from and so this approach only gets used if the downturn is deeper than predicted or longer lasting.

Your Sales Efficiency Will Probably Plummet Toward $10m ARR. Plan For It.


But specializing across the sales process will take more headcount. When a great SaaS business starts to come together, and crosses Initial Traction ($1-$1.5m), growing nicely (8-10%+ Month-over-Month Growth) … often times, the founders start to see the first bit of real economic returns on the model. It finally starts to make sense, this SaaS stuff.

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What Sales Operations Can Learn from Restaurants


As headcount surges, what specific fields mean, why they are useful, and when the business requires that information can be lost in the shuffle. Boston’s Trident Booksellers and Cafe thrums on a Saturday morning. The place is packed — Busboys bustle past waiting patrons to drop off clean glasses for the bartenders, only to be coaxed out of the way by a waiter looking for their next order, or a host seating a table.

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SaaS Company Benchmarking: Leveraging Metrics for Performance Insights


Benchmarking also provides useful data on spending levels across the major expense categories, i.e., COR, R&D, S&M, and G&A, and well as specific data on headcount for each team within these categories. For example, you can access Sales headcount data for Account Executives, Sales Development Reps/Business Development Reps and Renewal Reps along with compensation data.

Redpoint SaaS Startup Key Metrics Template

Tomasz Tunguz

This section covers employee satisfaction, headcount, and recruiting metrics. Over the last decade or so, I’ve compiled a metrics sheet to summarise a SaaS business. While no living document like this is ever perfect, this is currently the best board-level summary of the overall health of a business I have found. I’m sharing it so that others may benefit and improve it. If you have suggestions, please email me. Redpoint SaaS Metrics Template.

How to Choose a Customer Engagement Model


The volumes and customer-to-CSM ratios mentioned above give a basic guide to the customer engagement model that may best suit your enterprise and customer accounts, but there is more to optimizing customer success than just balancing a headcount.

Your Product Sells Itself. Now Hire Sales.

OpenView Labs

Sales now accounts for about 7% of the company’s headcount–a similar share of their workforce as marketing or product management. I’d even argue that the company is still under-resourced in sales; sales accounts for only 7% of Atlassian’s headcount compared to 25% of headcount at the average PLG business. Among the PLG businesses that have gone public since 2017, sales headcount grew by an average of 45% year-on-year compared to a 33% increase in non-sales headcount.

5 Startup Roles That Help you Grow Faster


A sales operations manager makes your sales team more effective, so you get more done with fewer headcount. When you are growing fast you end up spending a lot of time getting the right people into the roles in the right structure to help efficiency, communication, quality, and results.

The Employee Productivity Patterns of Billion Dollar SaaS Companies

Tomasz Tunguz

The chart above shows the headcount growth of the median publicly traded SaaS company from year four through year ten of the company’s life. The multiplicative effect of headcount growth and improving productivity fuels the growth of the business. SaaS companies are marvelous businesses. They are more predictable than most other kinds of companies and in addition they demonstrate leverage from technology.

By the time you're at $2-3M in ARR, you need a VP of Sales who's done it before

The Angel VC

As you can see in the spreadsheet and in the chart, based on these assumptions your total sales headcount increases from 2 to 9 in year 2 and from 9 to 30 in year 3. PS: As you can see in the chart below, there's a 1:1 correlation (approximately) between ARR and sales headcount. For most SaaS startups, the VP of Sales (along with the VP of Marketing) is one of the most crucial hires they need to make. Unless you have a no/low touch sales model and you're growing virally (a.k.a.

6 Mistakes to Avoid in Your Inbound Lead Follow-Up

Sales Hacker

This includes their own technology, reporting, and headcount as well as what Marketing needs from Sales in terms of feedback and accountability. This includes their own technology, reporting, and headcount as well as what Sales needs from Marketing in terms of feedback and accountability. When inbound sales and marketing works, it’s great. It’s easy, it scales well, but by definition it puts a lot of the process out of your hands.

How to Improve Customer Retention—Even During a Pandemic


Introducing a scalable digital solution now will leverage your current resources toward taking proactive steps to create value without the need to add to your headcount during an uncertain time. Customer retention is the continuation of a valued service.

Top 5 Must Have FinTech Solutions in 2020


There are a ton of FinTech or RevOps products on the market and you can’t use them all but if your business is growing and you need to keep up without adding a ton of headcount, these are definitely solutions you want to invest in for 2020. What if I told you that we have 1 full-time finance team member managing revenue operations with over 80 employees and 650+ customers? Yes, you read that right.

How to Make the Case for Product Ops at Your Organization


For a cross-functional role like product ops, it’s not only about convincing leadership for headcount and resources. By Sara Estes, Content Marketing Manager. As technology companies scale, silos emerge and processes can break down — creating the need for a dedicated function to drive alignment, communication, and efficiency across the company. We’ve already seen this play out with the emergence of plenty of other ops roles, and now, product has an operational force of its own.