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The Most Important Metric For Startups

After you’ve established a product-market fit and have your demand generation in order on the marketing and outbound sales side of things, it’s important to ensure that your reps have their calendars full depending on the deal size.

Once that’s solidified, founders should be looking at the average deal size, the speed — how fast the deals are going through the sales cycle, not just in total but by stage — and then on top of it too is the conversion rates.

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Perfect Customer Profile

Many companies map out their ICPs(Ideal Customer Profile) but don’t take it to the next level. But imagine only having ‘first-round calibre talent’ in your pipeline. It’s like having the best of the best — the 20% of your customers that create 80% of your revenue but that’s all that’s in the pipeline. That is PCP, the Perfect Customer Profile.

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Three Core Operating Systems: The Whale Scale Operating System

This first operating system is about applying the 20/ 80 PCP rule mentioned above to your targeting. Then from there, you need to execute on doubling your average deal size year over year. “It’s really stacking strategy, process and then execution all the way down to what you say, when you say it, who you say it to, and the order you say it in so that it’s fully comprehensive.

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The Exponential Expansion Engine

Most SaaS founders have developed an excellent primary sales engine to cover the front end. They may have retention rates in the mid to high 90s but then don’t have a secondary sales process in place where they don’t speak to their customers.

Customer service is more of a nurturing process where you “take care of customers after the fact. But if you seed and sell the entire time that you’re doing that, you’re not only providing value to the customer but then you’re really truly understanding what the biggest problems they have are and then continually solving them.

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Referral Operating System

Referral is the single best way to double the size of your company repeatedly. “We got that Amazon Whole Foods deal. It was through a referral. That was a $20 million deal that changed the entire direction of the company.” Companies like Tesla, Slack, and Dropbox have been able to drive significant growth through referrals.

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The Four-Step Referral Framework

  • The pathways: the type of incentives you have.
  • The emotional peaks the customer has: If you think about the emotional experience of the buying process, you have to understand those peaks and then align with them accordingly.
  • The sales process: the behaviour design that determines how you align the customer emotional peaks with the sales process.
  • Persuasion: Humans have mental shortcuts and 90% of decisions are made through our subconscious. This step is about tapping into that subconscious and the mental shortcuts that people take through an influence strategy.

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CURATED BY

amir_amir

My thoughts

CURATOR'S NOTE

Startup Strategies and Metrics

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