Hi there Femstreet folks! I am Sandhya Hegde, a Venture Capitalist at Unusual Ventures, where I lead investments in B2B software. Founded in 2018, Unusual is silicon valley’s first full-service seed fund giving technical founders unparalleled GTM support across critical services like recruiting, sales, marketing, community and product-led growth. Our portfolio includes unicorns like Webflow, Carta, Harness and Arctic Wolf Networks. Prior to Unusual, I was an executive at Amplitude, a leader in product analytics and helped scale the business 30x in ARR. At Amplitude, I built and led teams across Growth, Marketing and New Products. While there, I also founded Amplify, the world's leading product-led growth conference with over 10k+ annual attendees and was a Product Strategy coach for many Fortune 100 companies including Walmart, Ford and NBC.
Over the past 6 years, I have been at the forefront of the product-led movement that has swept the world of enterprise software startups. Today I am here to chat with you all about testing your own startup ideas and how to set up a modern GTM motion for a SaaS startup.
If you are an early stage leader or considering starting your own enterprise software company with product-led growth, here are a few things to consider:
Find Hair-on-Fire problems - With increased access to financing, there has been an explosion of new B2B software startups over the past few years. Before you launch your company or new product, make sure you are tackling a hair-on-fire problem for your customers. Most startups and products die because they don’t have enough market pull.
Build Products that are Easy to Learn (vs Easy to Use) - With the consumerization of enterprise software, there has been an increasing focus on making B2B tools easier to use. However, some of the most valuable work tools are often not intuitive and have a learning curve. Successful product builders today are investing in making their products easy (and desirable) to learn.
Invest in Success before Sales - The days of the traditional top-down, relationship-based software sale are fast drawing to a close. While the Sales function will always be crucial for most B2B companies, the newest breed of successful startups are investing early in success to drive higher ROI from layering on sales.
I am excited to chat more with you about the nitty-gritty of these trends and exactly how to approach them! Post your questions below 👇
Great question! I There are a few different ways to approach it but it comes down 1 important criteria - is your product's primary, differentiated, value team collaboration or just ease of use? If it's the latter, going B2C first and building a large community of evangelists that starting taking your product to work (so to speak) is ideal. If it's the former, you want to start by focusing on small teams instead of taking a B2C approach. In terms of tactics, this might mean that you discourage personal emails in your sign up flow and encourage people to invite team members as a first step in your onboarding itself!
This is helpful, Sandhya! What would you recommend as the top channels/mediums for evangelizing that one should focus on for the B2C route. Especially if we are a bootstrapped org just starting with a V1 product?
The best way is to pick a community rather than think of it as channels. What's a community that you think will be an early, fanatical adopter of your product (even when it has warts!) and where do they hang out today? Whatever their channel is, you want to join that and become a strong presence. Ideally this is also a community whose principles and vision align with yours and that's growing and attracting a lot of new people everyday.
Karn - this exact approach is what we are building at Notus. We are still in build mode, but feel free to reach out or sign up to our waitlist: getnotus.io
Interested in hearing your advice on the early days of building out the Success function and processes. Any successes or mistakes from your career that would help those of us just getting started?
Hi Rachel! I haven't personally scaled a CS team but have ha the good fortune of working with some incredible success leaders. I think of CS in 2 phases:
1) Getting to service-customer fit. This is the early days of your company when the CS team really just needs to do whatever it takes to help customers succeed and be their voice and champion within the company in every way possible. You don't what to scale yet so you need to document what makes a real difference to your customers. This is where I have seen team make mistakes - they work hard but don't take the time to step back and ask themselves which of their investments paid off and which didn't. That retrospective should result in a best practice playbook!
2) Scaling customer love. Once the company starts growing, a big mistake they make is not investing in ops and data for the CS team. They are still stuck in the "all-hands-on-deck" mode of phase 1. Ops/data gets prioritized for sales but not for CS. If you are leading the function, once you cross ~10 CSMs, it's vital that you have access to the data and resources you need to be able to prioritize your team's efforts.
One last thing, the metrics that a CS team focuses on can change a lot over time. From customer activation to churn to expansion. It's important to evaluate what the right metric is based on where the company needs to drive the most change!
Also, how does one size the market which is a category creator? For example, a tool that could make any video base communication interactive (overlayed with questions etc). Now videos are used across the board in all industries and all sizes of companies. How do I calculate a realistic market size to know it is worth the time?
You ask such good questions Karn! :) Sizing the addressable market in category creation mode is very challenging. What I typically recommend is to be conservative on sizing it but then look for hard evidence that it's growing very fast. For example, what's a specific persona that you have evidence would want to pay for this interactive video comm solution? (They should already be trying to hack it in a different way). How many people like that exist in the world? Start narrow and then look for evidence that there are strong tailwinds in the market that will result in more personas adopting it over time.
Hi Sandhya! 👋🏿 It's nice to "meet" you 😁. In your experience have you seen B2C or DTC brands make a successful pivot to B2B? If so, what do you think contributed to their success? If not, what do you think was the cause of their failure?
Hi Nnenna! There are some good recent examples of this. Both Calendly and Webflow come to mind. Both were focused on "prosumers" and went to market very much like a B2C service before expanding focus to companies and team accounts. I think the most critical driver of that successful market expansion is the fact that these products had a massive "collaboration" use case that the companies productized. When you are able to solve a team's pain just as well as you solve the individual's pain, the shift to B2B becomes natural.
When it comes to failure, there are so many reasons shifts don't work out. There might not be enough market pull for a teams use case, you might not get security and SSO implemented fast enough or you might not hire the right new team members for a B2B GTM motion. We see this often even in B2B companies that do well in the SMB segment but then struggle to go up market to sell to large enterprises.
Hi Sandhya! Great post. We're building an easy to learn/use B2B tool for local governments. We're considering using product-led growth as a GTM since our tool is lightweight and easy to implement compared to the mammoth legacy systems governments onboard. Do you have tips on how we can launch a successful product-led growth GTM in a typically legacy systems-heavy industry (like gov)? Thanks!
Hi Pavani! Great question. One thing I always ask folks who want to implement PLG is - does your customer want it? You can't force self service/bottom up motions on your customer. For the government as a buyer, you might want to use what we call a "Pincer" motion - where you have a self service experience but couple that with a small sales team (or just the founder at first) going top down to better understand what it would take for them to actually become paying customers.
PLG motions tend to fail if you don't have a clear hypothesis for how the purchase will happen (ie whose influence is going to drive it?) or what price point might work.
Hi Sandhya! Thanks so much for doing this Q&A :) Couldn't agree more with point #3! A question I have is on team structure for marketing- what roles/skill sets/mindsets are crucial in a PLG marketing team in your experience?
Great question!! In my experience it's not so much about roles and skills as it is about mindset and priorities. In a PLG motion, the marketing team's primary job is to get more hands on the product as opposed to in conversations with sales. So the immediate outcome you are optimizing for is different (say PQLs as opposed to #sales meetings). Everything else is not that different. In fact great messaging and brand building become even more crucial in a PLG motion because your website and brand are the first point of contact for every potential customer - instead of a sales person reaching out.
Hi Kuljit! Great question :) .. I assume you are focused on how we built awareness and acquired registrations for the event. I would answer that in 3 phases:
1) We only decided to develop Amplify (a 2-day $M event launched in 2018) because we had some evidence that the product community was interested in it. Our "test" was a small 2 hour event with a similar concept that cost $80k but got over 2000 registrations. That helped us build a case for a bigger investment and we planned the first conference over a 4 month period.
2) We knew that our audience (product growth community - including PMs, engineers, designers and analysts) cared about *learning* more than anything. So we kept an extremely high bar for the kind of speakers we brought on board and published content about their experiences leading up to event. Every new speaker who joined was an opportunity for us to promote the event along with them. The content was always designed to help the community learn (not sell our software)
3) Last but not the least, our SDR team was a huge source of targeted leads that ensured high ROI from the conference. We invited entire teams from our target (and existing) customer accounts to make Amplify their quarter's team event. Some teams came in numbers as large as 20-30 because they wanted to get inspired together and valued the speakers very highly.
This is a topic that likely deserves a whole book but hopefully this paints a bit of a picture!
Hello Sandhya ! Thank you for being generous with your time. I hope you and your family are faring well in these interesting times. Would you be open to trying out our software when we launch and providing your expert feedback ? Thank you again, Joana
Hello, Sandhya, great post! Can you give us an example of startups that invested early in success to drive higher ROI from layering on sales and exactly what strategies they implemented?
Was so great chatting with you all! Please feel free to reach out to me sandhya@unusual.vc for anything about starting up :)
May I also connect with you on LinkedIn?
This was a very cool session! Thanks Sandhya!
How does one go about launching a product which could be both B2B/B2C (eg canva)? Also how to know which segment to focus on?
Great question! I There are a few different ways to approach it but it comes down 1 important criteria - is your product's primary, differentiated, value team collaboration or just ease of use? If it's the latter, going B2C first and building a large community of evangelists that starting taking your product to work (so to speak) is ideal. If it's the former, you want to start by focusing on small teams instead of taking a B2C approach. In terms of tactics, this might mean that you discourage personal emails in your sign up flow and encourage people to invite team members as a first step in your onboarding itself!
This is helpful, Sandhya! What would you recommend as the top channels/mediums for evangelizing that one should focus on for the B2C route. Especially if we are a bootstrapped org just starting with a V1 product?
The best way is to pick a community rather than think of it as channels. What's a community that you think will be an early, fanatical adopter of your product (even when it has warts!) and where do they hang out today? Whatever their channel is, you want to join that and become a strong presence. Ideally this is also a community whose principles and vision align with yours and that's growing and attracting a lot of new people everyday.
Got it. Thanks :)
Karn - this exact approach is what we are building at Notus. We are still in build mode, but feel free to reach out or sign up to our waitlist: getnotus.io
Interested in hearing your advice on the early days of building out the Success function and processes. Any successes or mistakes from your career that would help those of us just getting started?
Hi Rachel! I haven't personally scaled a CS team but have ha the good fortune of working with some incredible success leaders. I think of CS in 2 phases:
1) Getting to service-customer fit. This is the early days of your company when the CS team really just needs to do whatever it takes to help customers succeed and be their voice and champion within the company in every way possible. You don't what to scale yet so you need to document what makes a real difference to your customers. This is where I have seen team make mistakes - they work hard but don't take the time to step back and ask themselves which of their investments paid off and which didn't. That retrospective should result in a best practice playbook!
2) Scaling customer love. Once the company starts growing, a big mistake they make is not investing in ops and data for the CS team. They are still stuck in the "all-hands-on-deck" mode of phase 1. Ops/data gets prioritized for sales but not for CS. If you are leading the function, once you cross ~10 CSMs, it's vital that you have access to the data and resources you need to be able to prioritize your team's efforts.
One last thing, the metrics that a CS team focuses on can change a lot over time. From customer activation to churn to expansion. It's important to evaluate what the right metric is based on where the company needs to drive the most change!
Thank you! So helpful!
Also, how does one size the market which is a category creator? For example, a tool that could make any video base communication interactive (overlayed with questions etc). Now videos are used across the board in all industries and all sizes of companies. How do I calculate a realistic market size to know it is worth the time?
You ask such good questions Karn! :) Sizing the addressable market in category creation mode is very challenging. What I typically recommend is to be conservative on sizing it but then look for hard evidence that it's growing very fast. For example, what's a specific persona that you have evidence would want to pay for this interactive video comm solution? (They should already be trying to hack it in a different way). How many people like that exist in the world? Start narrow and then look for evidence that there are strong tailwinds in the market that will result in more personas adopting it over time.
Just real problems our team is facing :)
Helpful advice, thanks!
Hi Sandhya! 👋🏿 It's nice to "meet" you 😁. In your experience have you seen B2C or DTC brands make a successful pivot to B2B? If so, what do you think contributed to their success? If not, what do you think was the cause of their failure?
Hi Nnenna! There are some good recent examples of this. Both Calendly and Webflow come to mind. Both were focused on "prosumers" and went to market very much like a B2C service before expanding focus to companies and team accounts. I think the most critical driver of that successful market expansion is the fact that these products had a massive "collaboration" use case that the companies productized. When you are able to solve a team's pain just as well as you solve the individual's pain, the shift to B2B becomes natural.
When it comes to failure, there are so many reasons shifts don't work out. There might not be enough market pull for a teams use case, you might not get security and SSO implemented fast enough or you might not hire the right new team members for a B2B GTM motion. We see this often even in B2B companies that do well in the SMB segment but then struggle to go up market to sell to large enterprises.
Hi Sandhya! Great post. We're building an easy to learn/use B2B tool for local governments. We're considering using product-led growth as a GTM since our tool is lightweight and easy to implement compared to the mammoth legacy systems governments onboard. Do you have tips on how we can launch a successful product-led growth GTM in a typically legacy systems-heavy industry (like gov)? Thanks!
Hi Pavani! Great question. One thing I always ask folks who want to implement PLG is - does your customer want it? You can't force self service/bottom up motions on your customer. For the government as a buyer, you might want to use what we call a "Pincer" motion - where you have a self service experience but couple that with a small sales team (or just the founder at first) going top down to better understand what it would take for them to actually become paying customers.
PLG motions tend to fail if you don't have a clear hypothesis for how the purchase will happen (ie whose influence is going to drive it?) or what price point might work.
Hi Sandhya! Thanks so much for doing this Q&A :) Couldn't agree more with point #3! A question I have is on team structure for marketing- what roles/skill sets/mindsets are crucial in a PLG marketing team in your experience?
Great question!! In my experience it's not so much about roles and skills as it is about mindset and priorities. In a PLG motion, the marketing team's primary job is to get more hands on the product as opposed to in conversations with sales. So the immediate outcome you are optimizing for is different (say PQLs as opposed to #sales meetings). Everything else is not that different. In fact great messaging and brand building become even more crucial in a PLG motion because your website and brand are the first point of contact for every potential customer - instead of a sales person reaching out.
Thank you! That's a great point re: branding and marketing. First impressions matter!
Hi Sandhya, Could you give a bit of insight into the launch strategy you implemented for Amplify ?
Hi Kuljit! Great question :) .. I assume you are focused on how we built awareness and acquired registrations for the event. I would answer that in 3 phases:
1) We only decided to develop Amplify (a 2-day $M event launched in 2018) because we had some evidence that the product community was interested in it. Our "test" was a small 2 hour event with a similar concept that cost $80k but got over 2000 registrations. That helped us build a case for a bigger investment and we planned the first conference over a 4 month period.
2) We knew that our audience (product growth community - including PMs, engineers, designers and analysts) cared about *learning* more than anything. So we kept an extremely high bar for the kind of speakers we brought on board and published content about their experiences leading up to event. Every new speaker who joined was an opportunity for us to promote the event along with them. The content was always designed to help the community learn (not sell our software)
3) Last but not the least, our SDR team was a huge source of targeted leads that ensured high ROI from the conference. We invited entire teams from our target (and existing) customer accounts to make Amplify their quarter's team event. Some teams came in numbers as large as 20-30 because they wanted to get inspired together and valued the speakers very highly.
This is a topic that likely deserves a whole book but hopefully this paints a bit of a picture!
Hello Sandhya ! Thank you for being generous with your time. I hope you and your family are faring well in these interesting times. Would you be open to trying out our software when we launch and providing your expert feedback ? Thank you again, Joana
Always! You can email me sandhya@unusual.vc, I'll always be a PM at heart and happy to share any feedback I can that will be helpful.
Hello, Sandhya, great post! Can you give us an example of startups that invested early in success to drive higher ROI from layering on sales and exactly what strategies they implemented?