Designing your SaaS business to create predictable traction.

A three layer approach to reliably grow SaaS product traction / market traction

Designing your SaaS business to create predictable traction. A three layer approach to reliably grow SaaS product traction / market traction

Posted on Tuesday, October 25th, 2022 by Ton Dobbe

You’re a startup founder, and you started a SaaS business… Your goal: Create change that will be noticed…

You spotted this massive problem that was screaming to be solved…. and decided to take that challenge.

But as much as the good intentions drive the start…. sooner rather than later, problems arise… Traction problems.

Getting traction is challenging in various stages of your business. Keeping it and making it predictable is even harder. And the stress it gives harms our good intentions.

1 – Instead of becoming the hero to somebody, we aim to be everything to everybody
2 – Instead of selling at a premium, we drop the price and get trapped in discount battles
3 – Instead of sticking to the long-term vision, we prioritize surviving the short term

No wonder, so many SaaS startups fail.

Consequently, the question I get a lot is: How can SaaS startups grow traction? And beyond that – how do you make it predictable?

But before we answer that, let’s first answer this question: What does traction mean in business?

What is traction meaning in business?

In short, to “gain traction” is to begin to have success. But traction success comes in different flavors. Here are three flavors of traction relevant to a B2B SaaS business.

  1. Market traction: The quantitative evidence of market demand I.e. the proof that somebody wants your product (Naval Ravikant, the Co-Founder of Angel List)
  2. Product traction: Evidence that your SaaS product or service has reached its tipping point i.e. “hockey- stick” adoption rate
  3. Business traction: It’s achieved when a SaaS business discovers a repeatable, financially sustainable, and scalable process for revenue growth.

Achieving Business traction can there only happen when you’ve landed on a large enough segment of the market, that your product has found product market fit and that you’ve created a valid business model that can drive sustainable growth.

But gaining just business traction is not enough. What’s required is to make it predictable. Let’s define that as well:

My definition of gaining predictable traction is: The art of turning initial success into a reliably accelerating motion of SaaS sales – not only in good times but also in bad times.

Now, back to the trap I discussed above….Getting out of this trap requires changing the game: The new game: Traction Resilience.

It’s anchored around a simple yet powerful word: Remarkable. SaaS companies that embrace this experience The Remarkable Effect:

– They attract exactly those customers that are prepared to pay a premium
– They influence the momentum of the sales cycles and win the bulk of the deals
– They invest in the next big thing when they’re at the top of their strengths – and with that, prevent growth from stalling
– They don’t just grow fast – they create a fly-wheel effect
– And ultimately, they build traction resilience

Question for you to reflect upon

What exactly has driven the most traction for your SaaS business the last 12 months?

What is traction in business really about?

Surprise everyone – your customers, your investors, yourself …. yes, even your competitors.

What if this became a reality for your SaaS startup?

Isn’t that what you’d love to come out of bed for every day? I would!

Every time I mention this sentence to B2B SaaS professionals I meet, it makes them smile. You can see them wandering off, imagining what this would be like for them to be in this state with their SaaS business.

The question that always follows: Yes, but how?

My answer is always: It’s a mindset shift

  • Stop focusing on you – start focusing on them
  • Stop trying to please everyone – please the right ones
  • Stop thinking about your target – start thinking about their target

The answer is in these three simple rules

  • It will allow you to pinpoint those that need you most
  • It will help you to home in on ‘the thing’ that keeps them up at night
  • It will inspire you to build that what allows them to make the most significant difference.

That’s where surprise starts

  • It turns customers into fans
  • It makes them want to buy more – more often
  • It triggers word of mouth – which inspires their peers to find you
  • It stops the debates about discounts – because the value is clear
  • It brings your flywheel in motion – and grows its pace rapidly
  • It will start to create surprise amongst your investors
  • It will even surprise you to see what your SaaS business is up to
  • It will bring resourcefulness – and thus, R&D can do its magic release after release, without compromise
  • It will surprise your competitors with an approach they don’t have answers for.

Key takeaway: Stop trying to be better – aim to be different. Lead with surprise.

Question for you to reflect upon

In what way can you surprise your ideal customer tomorrow?

The different phases of building predictable market traction

Recently I met with several VCs and Private Equity professionals from the AsiaPac region.

We discussed the question: “How to identify successful SaaS companies: Key traits to spot in a Red-Hot industry.”

And inevitably, the looming economic downturn mixed into the discussion as well. But, either way, the debate around which key traits to look for is super valuable – whether a downturn or not.

In this blog, I will address it by looking at “traction” from three different dimensions.

Although traction is a magic word in SaaS, it’s not built in isolation.

It’s not the simple result of a campaign, a product launch, or the win-rate development of your sales team.

Let’s define SaaS traction first. Here’s my definition: It is the rate at which new customers are signing up to use your SaaS product or service and the speed by which your product spreads within their organization and beyond (word of mouth). It’s about adoption and diffusion.

Remarkable SaaS businesses design for traction. And let’s simplify it by putting their efforts into three buckets:

  1. Traction Foundation
  2. Traction Momentum
  3. Traction Resilience

Why? Because it’s essential that traction starts, grows, and never stops doing so. And it’s mainly the latter part that most SaaS companies suffer from.

SaaS businesses that design traction across three dimensions ultimately growth strength around the following metrics:

  • The continuous inflow of high-quality leads into their funnel
  • Better than market average velocity of deals and win rates
  • Continued strong product adoption and customer retention even in a downturn
  • Continued top-line growth when the market slows down
  • Top-tier gross margin that’s easier to maintain at high levels
  • Last but not least – Freedom due to becoming /staying cash flow positive

Question for you to reflect upon

What potential flaws in your business can put today’s solid traction at risk?

The three-layer SaaS Product Traction design

Layer 1: Traction Foundation

Step 1: Crystal clear segmentation

To tune or not to tune your segmentation – that’s the question. So why bother? It all starts with recognizing what’s harming performance in your SaaS company:

  • The apparent signals: dreading sales cycles, win rates that feel too low, and the typical discount battles.

But there are more signals to watch:

  • Unnecessary waste of your marketing budget (targeting people that will never buy)
  • Poor quality ‘leads’ in your pipeline that are better off with your competitors)
  • The costly attempts to satisfy customers that will never become ambassadors
  • A bland Product roadmap filled with features to please a single customer
  • A higher than the average churn rate

When you sense any of this, you might have a segmentation problem.

As you can see, a go-to-market strategy with too broad segmentation impacts the business in many ways: The resources you need (both people and money). Your revenue potential. Profitability potential. Customer lifetime value (LTV), etcetera.

It not only harms the business at the beginning of the customer journey – it does its damage across the entire customer journey. It’s a ‘fine’ you pay forever.

Top SaaS companies that create predictable traction eliminate this from the start. And it makes everything easier for them: Attraction, conversion, time-to-value, retention through a smoother and better customer experience – and possibly the most important one: leverage through word of mouth.

The latter allows them to consistently have a high customer success – and hence a high Net Promoter Score / Customer Satisfaction Score (CSAT) and benchmark Net Revenue Retention (NRR).

They approach their perfect segmentation like creating their favorite cocktail:

  1. A splash of demographic and firmographic criteria
  2. A touch of detail on what dynamics uniquely define their ideal customers
  3. A pinch of information about what they stand for and value
  4. A splash of what they deeply desire
  5. And last but not least, topping it with clarity on what risk they tolerate/do not tolerate

The power is in the mix – make each ingredient work to make it unique and attract the right customer. For details see this long-form blog.

And that brings me to the 2nd step within this layer: Positioning

 

Step 2: Laser-sharp positioning

Not a single SaaS business starts with the aspiration to make doing business hard. Delivering the transformational change they’re dreaming about is hard enough. Fact is: There’s no such thing as bringing a brilliant product to market and ‘then they’ll come.’ The sad thing – inferior products positioned brilliantly outperform remarkable products with poor positioning. And as such – poorly positioned products will never reach their full potential no matter how well it is marketed.

The thing to embrace is that positioning is not about you, it’s about your ideal customer. It’s about taking position about what they deeply care about and how that helps to paint the right reference point (relative to others) in the mind of the prospect. This is about empathy. About deeply understanding the problems that they perceive most valuable and critical to solving. Your positioning goldmine is hidden inside that knowledge.

And then it’s about choosing the positioning angle for your SaaS model. In another long-form blog I have described 5 positioning strategies:

  1. Position yourself around what your ideal customers stand for
  2. Position around what your ideal customers secretly want
  3. Position around the essence of the most valuable problem your customer wants to be solved
  4. Position around the values your customer embraces to stand out
  5. Or any combination of the above

And lastly, it’s about tuning for impact i.e. working on the key ingredients that make your positioning remarkable.

and this brings me to step 3 within this layer: A compelling Value Proposition

 

Step 3: Compelling value proposition

In essence, a SaaS value proposition is a summary of the value your service or product will deliver to customers once they choose to buy from you. Your value proposition should provide

  1. a crystal clear summary of the most valuable problem you solve for your buyer,
  2. how it will help them make a difference in ways your competitors/alternative offerings can’t, and
  3. what benefits this drives for your buyers as a consequence.

In short: How will your promise help your buyer transform into something they aspire to.

It focuses on laying out the value of buying from your company. It addresses your customers’ needs and clarifies why they should choose your software solutions or services, not those of another company.

When your potential customers read your company’s value proposition, they should understand instantly why it’s worthwhile to spend their money on what you’re selling:

  • how you help them achieve their ambitions, competitive advantage and create a remarkable impact
  • how you’ll help them overcome the problems that are most valuable and critical to solve,
  • how you’ll add to their lives
  • how they will experience something that no other business software company or product can give them.

Your value proposition have a direct effect on your ability to convert prospects into customers. In fact, a study showed that value propositions can increase conversions up to 90 percent. That’s direct MRR (Monthly Recurring Revenue) and ARR (Annual Recurring Revenue) impact and it can help make the difference between financial success and failure.

In addition to an increased conversion rate and lower customer acquisition cost (CAC), your value proposition helps differentiate you from the alternatives your customers have i.e. your ‘competitors’ in the SaaS market you operate in. This can help you build a niche for your particular business software company brand and strengthen your reputation.

Finally, you don’t just create value propositions to benefit potential customers. You also use them as the ‘selling point’ to help align another target audience: your own organization. A compelling Value proposition is clear, easy-to-understand and easy-to-reference statements that your employees can look at to familiarize themselves with your company’s mission and unique selling proposition. This can help shape a strong organizational culture within your SaaS Startup/Scaleup, make everyone feel like they’re working together toward a common goal, and grow the resilience and resourcefulness of your business.

In this long-form blog, I dig deep into how to create a compelling Value proposition

Let’s move to the 2nd layer, that’s essential to build an organization that builds predictable SaaS traction.

Layer 2: Traction Momentum

Step 4: Surprise and hit the right nerve

Being remarkable in B2B Software is challenging but not impossible. That’s what Equalture proves again.

Earlier this week, I interviewed Charlotte Melkert, CEO of Equalture. As always, I pay a quick visit to the website of the SaaS brand in focus. Long story short: The Equalture website got me from the 1st second. And I do not even bait for them!

“For the pioneers who are no longer willing to accept the biases of resume-based hiring.”

Bang! Instantly clear who they are for – and who they’re not for. It speaks to who their ideal clients aspire to be. It speaks to what they stand for. It speaks to a valuable and critical problem.

Second headline: “Without us being aware of it, our biased habits kill our business,” followed by a short, but spot-on list of how this hurts business

Spot on! It’s simple, concrete, and triggering emotions. It instantly builds credibility that they – Equalture – get this and get them.

Third headline: It’s time to break our habits…..Focus on potential rather than on a CV

For their ideal customers, this does it. Three ‘yesses’ in a row and a rallying cry that gets them to act with force.

Here’s the thing

If you take position, you’ll start to become the magnet for the right customers.

If you make your message about them and hit the right nerve – they’ll listen and act.

Conversations will be energetic because you are both on the same wavelength and speak their language. They’ll feel that you believe what they believe. And that wins the deal, repeatedly.

Question for you to reflect upon

What will your ideal customers think the first seconds they visit your website? That’s for me!! Or…. “not for me….”

Step 5: Kill silos  – shift from speed to velocity

I recently analyzed a testimonial I got from Adam Clarke, Chief Sales Officer at RoomRaccoon – and one of his quotes is worth reflecting upon.

It’s about the art of creating momentum with your SaaS business – and the value it brings when every aspect of your business gets aligned.

Here’s what he said:

“Interestingly, our SQL ratio has fallen. And I’m okay with that. It’s a consequence of us filtering out these people who were not for us and avoiding trying to force them into a sales process.

We’re identifying earlier that this isn’t the right prospect for us. So we’re avoiding spending a lot of time pulling them over the line and seeing them churn within six to 12 months.

The result: our Lead to SQL ratio has fallen, but what we are seeing is that our SQL to Closed has improved.

We’re spending more time with the right people, which ultimately helps our alignment with marketing; we’re building a much better profile of what an SQL should look like.”

Here’s the thing

It’s super easy to carve your business into departments – each with its own goals and metrics.

What happens is that everyone will go full speed ahead to achieve their goals to look good.

  1. Marketing will aim to fill the top of the funnel to present lots of ‘Marketing Qualified Leads to management.
  2. Sales will aim to push and hold on to every opportunity to present a 3, 4, or 5x pipeline to leadership.
  3. Services will do their very best to ensure +75% utilization and grow their service revenue numbers every quarter….

What happens? High departmental speed but no velocity as a business.

What Adam started to see was the power of alignment.

Having fewer but better leads with a high probability of closing is the thing to aim for.

  1. That creates a vibe across all departments
  2. It raises the productivity across all departments
  3. It drives the predictability of your traction and hence predictable revenue.

Question for you to reflect upon

Looking at the Lead to SQL ratio in your SaaS business – is it optimally aligned around what matters most: Winning more, better customers?

Step 6: Stop selling – Start making it irresistible

“Have you ever reflected on how to make your price list an asset to shorten your SaaS sales process?” I asked one a member of my CEO mastermind program last week.

I challenged him during our monthly 1-to-1 as we prepared an important topic for his next board meeting.

“What do you mean?” he asked.

“Well, is your pricelist just a formality, or does it make the total offering irresistible?” I replied

Here’s the thing

The typical way we treat our pricelist is like a list of ‘what’ we offer – and put a price on it, and most of the time, that’s a per-user/ per month model.

I’ve been responsible for pricing at Unit4 and have seen all the variants.

It’s super predictable. There’s no surprise factor.

So what if we’d break that pattern – and turn it into something that gives that final push to make buying a no-brainer?

And I don’t mean making it cheaper. I mean making it more valuable. Irresistibly valuable.

  • Instead of creating a three-flavor Sales model that’s typically named Lite / Professional / Enterprise – name each pricelist around the desirable transformations your customers long for.
  • Instead of pricing the features – price the to-be-expected outcomes.
  • Instead of stating their limitations, why not state your guarantees with each model?

And I can go on like this.

Make your pricelist all about what’s going on in the mind of your customers

  • What they buy is outcomes and the guarantees, not your features
  • What stops them from buying are the risks they see – address that
  • They want choice – give them three options, each one more irresistible than the other.

I guarantee you – they’ll notice and reward you for it even if you’re 2x the price of the nearest competitor. In their mind, your competitors will be the most expensive/risky option.

My question for you to reflect upon

Is your current SaaS pricelist an attractor or a detractor in the deal? What if you’d change that?

Finally let’s dig into the third layer that defines SaaS businesses that create predictable traction:

Layer 3: Traction Resilience

Step 7: Set clear direction – a strong vision

Earlier this year Interbrand revealed its annual study on the best brands in 2021. The fastest risers significantly outperformed other brands on three factors:

  • Direction: Set a clear direction. Ensure that the entire organization knows where you are going and is working towards the same ambition.
  • Agility: Move fast. Bring new products and services to market quickly, and where necessary, pivot to address changing customer needs.
  • Participation: Bring people on a journey with you, and make them part of the movement to create an engaging brand world.

As you’re probably aware, I am writing my second book, which is themed “Remarkable Resilience,” – and the three factors above indeed drip through in virtually every interview I do.

The big question is: “How do you pull this off?”

There are so many obstacles to overcome. Here are some of the more obvious ones I constantly see:

  • Our vision is inward-focused instead of outward.
  • We try to be everything to everyone.
  • We’re obsessed with the product, not the problem.
  • We assume we understand what customers need but are unclear about what’s keeping them up at night
  • We try to be better instead of being different.
  • …..

So the words ‘work towards the same ambition’ in the three factors above is probably the most crucial one to get right.

Without it, agility will be impossible. So yes, you will create some speed, but that doesn’t mean you’ll create velocity.

Without it, forget about creating momentum, let alone a movement.

One tip to get started is writing up your vision. In my recent podcast interview with Radhika Dutt, she gave a perfect definition:

“a good vision is one where you see a problem in the world that you want to see solved. And even if you’re not in the picture, you’d be happy to see that problem solved”

A remarkable example of this is Airbnb. Hands down, the industry most hit by the pandemic is Travel. So what if your name is Airbnb? Panic? Sure, what else if you see your gross bookings drop 39% (YTD).

However, their strong vision, Belong Anywhere, didn’t change as the pandemic hit; to the contrary – it made them stronger.

Think about it: Just because COVID made traveling impossible doesn’t mean it eliminated our basic need for belonging and connection.

What did change was the means to achieve its vision, i.e. their mission statement: “To create a world where people can belong through healthy travel that is local, authentic, diverse, inclusive and sustainable.”

Airbnb was going places and COVID wasn’t going to stop them. It’s resilient because it has a clear north star. Everything in their business is behind it – they live it.

  • It’s who they are – in good and bad times.
  • It helps them stay focused on what matters most to their clients
  • It’s their personality
  • It’s defining how they behave and how they show up
  • It’s the promise they make and keep
  • It’s what makes us believers
  • It’s what creates trust

That’s key to survive a crisis – any crisis. And the good thing. It does it’s magic also in good times.

Many tech businesses would have been stuck, dead in the water, simply because they strictly look at ”what they do”. Not Airbnb.

Why not? Because they are building their business around their big idea, not the product.

Their vision (and with that the essence of their message), ”Belong Anywhere”, has always been about two things: Belonging and Connection.

What has kept Airbnb afloat in the crisis is that their message actually means something.

  • It possibly has even grown in meaning.
  • It means everything to their customers – it’s something they keep coming back for.
  • It means everything to their employees – it inspires them to deliver their best work.

The point is: a fancy sounding message is only worth what it actually means to your employees and customers.

The question for you to reflect upon:

Is the message of the software business you founded or run as deep as Airbnb’s message? What if it was?

 

Step 8: Be obsessed with what’s changing and challenging

It all starts with recognizing what’s changing and is most challenging for your ideal customers.

This is about answering three simple questions:

  1. What’s still highly valuable (in the eyes of your ideal customer)?
  2. What’s (become) highly critical or urgent to them?
  3. Where can you exceed expectations?

With the insights from this exercise, you can start to tune your business and business model in various directions. The three most obvious ones:

  1. Refocus on making a difference around shifting priority that your customers have to deal with
  2. Refocus on making a difference around the new constraints they have to overcome
  3. Refocus the horizontal strengths of your offering on specific verticals

The most significant opportunity to create a tailwind in a market downturn can be a mix of all three angles.

The next thing to prioritize is how to take away all the objections to saying no, arguments to delay, and frictions that hinder adoption.

Two aspects that will make the most significant difference:

  1. Refocus on extreme fast ROI
  2. Refocus on winning the heart of the end-user

Every crisis brings opportunity. It’s what you do with it. That’s about mindset.

We can hide in our shells or be the creator of change i.e. raise our hands and see where we can help our customers make the most significant difference.

What option do you choose – that’s the question.

 

Step 9: Ensure resourcefulness

In my quest to uncover what makes B2B SaaS businesses remarkably resilient, one aspect that often rises to the surface is this one: Having options.

This is not about putting your eggs in different baskets. It’s about your ability to stay in charge and set the rules. I’d coin that as resourcefulness.

Amongst the many tech entrepreneurs I know, I see two camps:

  • Those who act from a position of strength – leveraging the luxury to weigh their options and fully commit.
  • The ones that always seem to be in reactive mode – being ruled by others, and only able to commit to the bare minimum

The question then becomes: What drives resourcefulness in SaaS?

Many sources influence it.

  1. It’s influenced by your definition of the organization you aim to be. Starting with a compelling vision of the change you seek to create in the market will ease alignment and direct the right behavior.
  2. It’s influenced by the kind of customers you attract. The right customers will use your SaaS solution as it was meant to. The wrong ones will constantly distract your entire organization.
  3. It’s influenced by the kind of people you hire. Keith Rabois quoted in the Starting Greatness podcast: “People who when they see a wall in front of them will figure out how to go under, over, around or make friends with the wall. They shock you with solutions.

Resourcefulness enables you to be two steps ahead of the curve and act from a position of strength – so that you have the entire gamut of options to choose wisely.

So my question for you to reflect upon

What’s the ability of your SaaS business to stay in charge and set the rules? What can you do today to increase resourcefulness?

To give a bit more illustration. I recently mentored a startup in the Techstars Stockholm cohort. At some point, we touched on the topic of ‘never having enough resources.”

Such a common challenge. And the fact is, no matter how large you grow your SaaS business – this feeling will always stay.

R&D is very expensive.

Not only because the best engineers come with hefty salary demands but because it’s time-consuming, it’s hard. In addition, the products you create are novel – and there’s no map to develop them faster or cheaper.

The opportunity is, therefore, in resourcefulness.

And resourcefulness is best achieved if you bundle your efforts.

What do I mean? Well, take it out of isolation – away from R&D.

Make it a clear challenge for everyone in your business:

  • Reward marketing for their efforts to become the magnet for the right customers
  • Reward sales for qualifying out fast – and win more of the right customers
  • Reward services for making the implementation process leaner and more scalable (instead of being obsessed with growing service revenue)
  • Reward product management to rid the roadmap of ‘stuff’ and to get the problem definition crystal clear.

Every little bit helps to make your business more resourceful.

And that will give every department – not only R&D – the room and space to focus on those projects that will make & keep you remarkable.

Stop measuring your success by the number of people you employ.

Start measuring your success by the impact you make for your ideal customers with the leanest possible team – a resourceful team.

Question for you to reflect upon

How many resources could you free up in your SaaS business by focusing on the right things?

 

Step 10: Eliminate bias – get out of your bubble

Over the past 4.5 years, I interviewed close to 250 tech-entrepreneurs from around the world for my weekly podcast. Since launching my book The Remarkable Effect in February last 2020, I ran well river a 150 Masterminds with B2B Software CEOs.

My conclusion: There’s bias everywhere:

  • …in our perception about the value of the problem we solve
  • …in our perception about the uniqueness of our products or platforms
  • …in our perception about the opportunity in the market
  • …in our perception about our chances of winning that next deal
  • …in our perception about the long-term viability of our business

and so on.

This kind of bias is holding us back in so many ways

  • …it affects our resourcefulness
  • …it affects our ability to make the right product strategy choices
  • …it affects our ability to stand out towards the right people
  • …it affects our ability to shorten deal cycles and win more often
  • …it affects our ability to shift from linear to exponential growth

Bias hurts our business in a sneaky way. It gives us a false sense of confidence because we tell ourselves stories that we actually believe are true. Let me illustrate this.

Last week I did another interview for my new book, and we hit the topic of ‘over-confidence.’

As 2022’s challenges revealed themselves, I got a little overconfident. There were a lot of layoffs. And I was like; it’s going to be fine. Don’t worry; this has happened to us before.
So I spent the first quarter telling people to relax; it’s fine. Then, I started to see how that wasn’t the case in the second quarter.
I misjudged what was happening this year and how a flash-in-the-pan moment of the pandemic is very different from an impending recession.
If I had a more objective mindset, I would have seen, ‘Oh, this is going to be different. But I leaned on a little bit too much confidence.

I think we’ve all seen this around us or even experienced it ourselves. And the question is: How can we avoid it? How can we avoid getting complacent and becoming too overconfident?

The reality is: We can’t if we don’t get out of our bubbles.

It’s not enough to speak with our inner circle: our leadership team, investors, and board advisors.

Why? Because they’re all stakeholders – they all have a vested interest and therefore are biased. So you can’t be totally free.

Here is where CEO peer groups kick in. People like yourself. Who’re living your problems but can look at your situation unbiasedly.

I asked Rami Darwish, CEO of Arrowlabs and a member of the CEO Mastermind program I run weekly, why this is so valuable.

Here are his top 5:

  1. It helps me to flesh out burning questions with a group of peers that are not going to judge you
  2. It’s an outlet to describe my issues being unhinged and explain my problem with no hidden agenda.
  3. It gives me an outlet to air out and recharge because the people in the room are there to listen, help and share.
  4. Knowing I am not alone in the journey. Being amongst peers who are going through the same or different challenges.
  5. It gets you to think about things you usually don’t get to think about. It brings diverse perspectives.

Question for you to reflect upon

Where in your SaaS business are you running the most significant risk of being overconfident? What could you change today to address that?

In Summary – Towards a predictable Traction business model

Getting traction is challenging in various stages of your business. Keeping it and making it predictable is even more challenging.

It’s not only essential that traction starts (which is hard enough). It’s even more important that it grows and never stops doing so. Unfortunately, the latter part is where most companies in the SaaS industry suffer from.

So how to design for predictable traction? Put simply; it’s about putting your efforts into three buckets and ten steps:

1 – Traction Foundation

  • Step 1: The segmentation cocktail
  • Step 2: Take position
  • Step 3: A Remarkable value proposition

2 – Traction Momentum

  • Step 4: Surprise and hit the right nerve
  • Step 5: Kill silos – shift from speed to velocity
  • Step 6: Stop selling – start making it irresistible

3 – Traction Resilience

  • Step 7: Set clear direction – a strong vision
  • Step 8: Be obsessed with what’s changing and challenging
  • Step 9: Ensure resourcefulness
  • Step 10: Eliminate bias – get out of the bubble

The power is in the mix – make each ingredient work to make it unique and attract the right customer.

SaaS businesses that design traction across these three dimensions ultimately grow strength around the following metrics:

  • Top of the funnel: high-quality lead generation
  • Bottom of the funnel: increased velocity of deals and win rates
  • The customer journey: accelerated product adoption and high customer retention (even in a downturn)
  • Top-line: solid top-line growth (even market slows down)
  • Bottom line: Gross margin that’s easier to maintain at high levels
  • Cashflow & Runway: Funding from a position of strength

It’s a choice. Good luck

Question for you to reflect upon

Which of the 10 steps above would make the biggest impact on your SaaS business if you’d address it with focus? What would be the 1st step?

 

How to start fixing unpredictable traction in your SaaS business?

The easiest way. Simply book a free call to explore if there’s a fit to do this together.

Otherwise – here are 5 other options