8 Critical Hires for Your SaaS Team
Scaling a SaaS business is anything but easy. Moving parts abound, with new challenges appearing every day. We’re not complaining – we simply wish to share our experiences and observations with growing SaaS companies. HR is certainly a critical element of business strategy, especially building and selling software. Bad hiring sets you back, while good moves pay huge dividends. We’d suggest looking at these 8 critical hires for your SaaS team. At some point, you’ll probably consider (or act on) hiring all of them.
Product Manager (Product Owner)
SaaS starts with a good product, one that solves a problem for customers. Perhaps you’re a CEO who found a need and managed to build it yourself. You’re a good product owner, having seen a problem and solved it. At some point, you may have to focus on other issues facing your company, so you’ll want a product manager to help you. A good product manager understands your market well enough to sustain your product/market fit. In addition, your product manager needs to understand technology – probably not as a developer or engineer – so you don’t over promise or underdeliver. A really good product manager is a master of UX (user experience), leading the way with surprise & delight in lieu of shock & dismay. Most importantly, your product manager should know your company’s limits. You don’t want to exhaust all your resources chasing a dream – you want sustainable, incremental progress that delivers revenue within your burn rate potential.
With a solid product in hand, you are ready to engage more potential customers. One of the best early hires for SaaS is a growth marketer, someone who truly understands conversion rate optimization (CRO). This person definitely has an experimental mindset – what works for one SaaS company most likely won’t work the same for another. Ideas should be put into a backlog, discussed with select stakeholders, prioritized, and tested. Over time, your product marketer will research extensively and end up knowing your market and what your customers face. It’s essential to hire a growth marketer who knows where you are in your marketing – someone who has been working for an international company with huge traffic has a different mindset than someone who built a product marketing effort from ground zero. “Like to like” is wise in your hiring process.
Marketers attract business, but you need to get subscribers signed. Your first sales hires should be able to build your sales operation from the ground up – their mindset has to be hunter, not farmer. You need predators, not sheep! Things will be messy early as you figure out messaging, demos, and pricing – but over time, strive to have your sales development team establish good systems & processes. And something we’ve experienced firsthand is hiring someone with a “track record” at a SaaS company. Unfortunately, SaaS businesses have different needs at different times, meaning past experience may not suit your model. Like marketing, you’ll want someone with relevant experience at your size. Someone who successfully sold SaaS at Salesforce didn’t face the same mountain as your three person operation…
Once customers are (hopefully) flooding in, you will need help with support and customer service. We like the “customer success” model, where a representative manages the handoff from sales, onboarding new customers and serving as first responder to issues (at least in the early days). A customer success manager should focus on TTV, time to value, which mitigates immediate churn, as well as upselling where feasible. Check-ins at regular intervals help too. The long term metric is CLTV, the lifetime value derived from longevity of the relationship. Customer success managers are essential hires for SaaS to scale up.
Show us the money… As you grow SaaS, the financial picture adds complexity. First, you face paying all these new hires! Payroll is challenging, especially with remote employees (if they live in other states or countries). Your finance director (or CFO) needs to keep a close eye on expenditures. Marketing wants a fat budget for trade shows and digital, the operation needs more infrastructure, you have three new developers, and tax rates just increased – it all starts to add up fast. Cost management and forecasting skills reduce business risk… And don’t ignore those taxes.
Marketing generates lots of traffic, sales delivers more new users, and customer success gets them humming along – all adding up to stress on the infrastructure. We’ve witnessed servers redlining, databases bogging down, and customers growing antsy. Growth is good until it leads to churn. Stability & performance matter more than ever as your user base expands. You need an infrastructure manager who can balance needs with costs, not over or under engineering things.
If you didn’t start out with a chief technology officer, at some point you need to make a strategic hire. A proper CTO is not a lead developer. This technologist focuses on three things: people, processes, and technology. That means getting the right people to do the right things in the right way. Your ideal CTO has a vision of what needs to be done and how to do it. Some CTOs have vision but fail to execute. Oh, and the measurement is velocity – turning vision into reality in a measurable way.
Two other things to weigh in on. First, you’ve probably accumulated technical debt during the software development lifecycle. A good CTO knows where the bodies are buried and gradually exhumes them. Second, as with other hires, look for candidates who have experience with IT projects similar in size to yours. A megacorp CTO had armies of IT folks to deliver on vision, which may not be an option for your startup.
A data analyst can be another great contributor to your team. As your prospects become customers and your customers use your product, you capture data. With a growth mindset & strong learning ability, your data analyst can generate new ideas. Being experimental and opportunistic, your SaaS team can blaze new trails in marketing, sales, operations, finance, HR, and more. Every area of your operation can be tuned. Build out some basic dashboards to start, then optimize from what you observe. Leverage systems data to exploit new opportunities.