S5E12 – The path to a successful $100M+ SaaS exit with Ryan Allis

Are you a SaaS founder dreaming of scaling your company from $1 million in Annual Recurring Revenue (ARR) to a $100 million exit? Well, you’re not alone! In this episode of the Grow Your B2B SaaS Podcast, host Joran Hofman talks with Ryan Allis, the CEO and founder of SaasRise, to explore how to achieve just that. Ryan has a proven track record, having built iContact from zero to $50 million in ARR and selling it for $169 million. Now, through SaasRise, Ryan helps other SaaS founders build their businesses with expert guidance, coaching, and digital ad agency services. If you’re looking to take your B2B SaaS business to the next level, this episode is packed with valuable insights to guide you on your journey.

The Exit Strategy: A SaaS Founder’s Perspective

When it comes to growing a SaaS company, planning for the future is critical. Ryan Allis stresses that SaaS founders must decide whether they’re building for an exit or for long-term cash flow. While both routes are possible, the fast-paced world of technology often leads companies to an eventual exit. In high-growth industries, it’s common to build a business for 5 to 10 years and then sell it, using the proceeds to create something new. Although some SaaS companies may go public or become large privately held firms, Ryan believes that for many, an exit is the ultimate goal.

Bootstrapping vs. VC Funding

Ryan recommends that SaaS founders consider bootstrapping their business during the early years. Bootstrapping, or funding the business from personal savings and revenue, can give you more control over your company. He suggests aiming for at least $500k in ARR before seeking outside funding. At iContact, Ryan bootstrapped the company until it reached $1 million in ARR before raising external capital. This strategy gave him more negotiating power, minimized dilution, and helped maintain control of the business.

Common Mistakes in SaaS Growth

While growing a SaaS company is exciting, it’s easy to make mistakes along the way. According to Ryan, there are two key errors many SaaS founders make: neglecting the importance of user interface (UI) and user experience (UX) design, and failing to invest in outbound marketing. Building a great product that solves a real problem is important, but it’s equally crucial to actively market your solution to potential customers. A well-designed product and strong marketing strategy are both essential for growth and scalability.

The Importance of Community

Building a strong community around your SaaS business can provide invaluable support as you grow. Ryan points out that being a SaaS founder can be lonely, and finding good advice can be difficult. That’s why SaasRise, Ryan’s platform for SaaS CEOs, is so important. It gives founders a space to connect with peers, share challenges, and receive valuable feedback and recommendations. Having a supportive community can make a world of difference as you navigate the ups and downs of scaling a SaaS business.

The SaaS Growth System: An Overview

Ryan outlines a simple but powerful system for growing a SaaS business. The key steps include understanding your unit economics, acquiring customers through ads and outbound marketing, scaling profitable channels, raising capital if necessary, and preparing the business for a successful exit. This strategy gives SaaS founders a clear roadmap to grow their companies and reach their exit goals. Following this system, step by step, will help you achieve long-term success.

Unit Economics: The Foundation of Growth

Understanding unit economics is the foundation of building a sustainable SaaS business. Ryan emphasizes the importance of tracking metrics like Average Revenue Per Account (ARPA), churn rate, and Lifetime Value (LTV). These metrics help you determine how much you can afford to spend on customer acquisition (CAC). A good rule of thumb is that your CAC should be around one-sixth of LTV or 50% of your Annual Contract Value (ACV). Knowing these numbers will allow you to allocate resources effectively and drive profitable growth.

Paid Customer Acquisition: The Holy Grail of Scaling

Paid customer acquisition is one of the most effective ways to scale your SaaS business from $1 million to $10 million in ARR. Ryan highlights the importance of testing and optimizing your paid channels to ensure that your customer acquisition cost (CAC) stays below your target. Successful paid acquisition strategies can drive exponential growth, but you need to constantly test and optimize your ads to achieve the best results. With the right approach, paid customer acquisition can be the key to scaling your business quickly.

Outbound Marketing: Educate and Engage

Outbound marketing is another crucial component of a successful B2B SaaS growth strategy. Ryan advises building a comprehensive list of potential targets and using tools like Apollo or LinkedIn Sales Navigator for prospecting. Once you have your list, you can use it to run targeted ads and cold email campaigns. The goal is to educate your market about your solution and engage potential customers. Outbound marketing allows you to get your message in front of the right people and drive more leads for your business.

Inbound Marketing: Building a Content Machine

In addition to outbound marketing, inbound marketing plays a vital role in growing your SaaS business. Ryan recommends dedicating three hours a week to creating valuable content that educates your market and establishes your thought leadership. This content can take the form of blog posts, videos, or social media updates. The key is to be consistent and focused on providing value to your audience. By doing so, you’ll boost brand awareness and attract more leads to your SaaS business.

Scaling: Building a Team and Systems

Scaling a SaaS business requires more than just marketing and sales—it also requires building a strong team and creating systems that can run independently. Ryan emphasizes the importance of key hires, including a head of sales, a marketing leader, and a finance expert. Additionally, it’s essential to develop processes and systems that allow your business to operate smoothly without constant oversight from the founder. By creating a business that runs efficiently, you set yourself up for long-term success and sustainable growth.

Raising Capital: Timing and Strategy

When it comes to raising capital, Ryan advises SaaS founders to wait until they’ve reached at least $1 million in ARR before seeking outside funding. This allows you to prove your business model and retain more equity. Ryan suggests only raising enough capital to scale proven channels and drive revenue growth. Be mindful of dilution—raising more than one times ARR can result in losing too much control. Focus on capital that will help you grow sustainably and profitably.

Preparing for an Exit: Strategy and Execution

Successfully exiting your SaaS business requires careful planning and execution. Ryan recommends growing your ARR to at least $3-$5 million before preparing for an exit. You’ll also need to engage professional M&A advisors who can help you navigate the process and get the best deal. Ryan suggests running a competitive process and working with investment banks to maximize your valuation and secure favorable terms. A successful exit doesn’t happen overnight, but with the right strategy, you can achieve your financial goals.

Conclusion: The Path to Success

To sum it up, Ryan Allis offers a detailed and actionable roadmap for SaaS founders who want to scale their businesses and eventually exit. By focusing on understanding your unit economics, mastering customer acquisition, building a strong team, and raising capital strategically, you can set yourself up for significant growth. SaasRise provides a supportive community for founders to share advice, challenges, and strategies, making it an invaluable resource on your path to success. Follow this roadmap, stay focused, and you’ll be well on your way to scaling your SaaS business and achieving a lucrative exit.

Key Timestamps

• (0:52) – Guest Introduction
• (1:29) – Should SaaS Founders Aim for an Exit?
• (2:38) – How to Achieve Nine-Figure Exits
• (2:41) – Bootstrapping vs. VC Funding
• (3:32) – The Importance of Bootstrapping
• (4:19) – Building Revenue Before Seeking Investment
• (4:39) – Mistakes SaaS Companies Make
• (5:01) – Effective Ways to Grow a SaaS Business
• (5:35) – Importance of Outbound Marketing
• (6:22) – Importance of Community for SaaS Founders
• (7:24) – Specific Forums for SaaS Growth
• (7:53) – Introduction to the SaaS Growth System
• (8:51) – Unit Economics and Customer Value
• (9:29) – Critical Metrics for SaaS Founders
• (10:24) – Calculating Customer Lifetime Value (LTV)
• (11:07) – Determining Target Customer Acquisition Cost (CAC)
• (11:49) – Importance of Paid Customer Acquisition
• (12:19) – Outbound Reach and Advertising
• (12:42) – Acquiring Customers Below Target CAC
• (13:09) – Outbound Marketing Strategies
• (14:18) – Educating the Market Proactively
• (14:33) – Creating a Comprehensive Lead List
• (15:54) – Utilizing Lead Lists for Marketing
• (16:21) – Creating Matched Audiences for Ads
• (16:52) – Email Sequences and Brand Omnipresence
• (17:34) – Transitioning to Warm Email Lists
• (19:54) – Importance of a Comprehensive Lead List
• (22:47) – Importance of Market Education
• (23:28) – Efficient Sales and Marketing Spend
• (24:12) – Providing Value in Content
• (24:23) – Creating Content and Distribution
• (25:09) – Building a SaaS Content Machine
• (25:39) – Importance of Founder-Led Content Creation
• (26:07) – Distribution Formats for Content
• (26:34) – Calculating Content Impressions
• (27:12) – Content Impressions and Growth
• (27:37) – Measuring Content Impressions
• (29:26) – Recap of the Content Strategy
• (30:17) – Content Creation Process
• (31:21) – Scaling and Building a Team
• (32:55) – Key Team Members for Scaling
• (33:33) – Building a System That Operates Without You
• (35:36) – Preparing for an Exit
• (35:47) – Steps for Scaling and Exiting
• (36:12) – Raising Capital and Timing
• (37:13) – Risks of Raising Capital Too Soon
• (38:00) – Building Revenue and Systems Before Raising Capital
• (38:46) – Guidelines for Series A and B Funding
• (39:59) – The Path to a Successful SaaS Exit
• (40:15) – Preparing for an Exit
• (41:12) – Working with M&A Advisors
• (42:10) – Professional Investment Banks for Exits
• (43:08) – Maximizing Exit Value with Investment Banks
• (43:39) – Benefits of Working with Investment Banks
• (44:24) – Final Advice for SaaS Founders
• (44:49) – Starting Out and Growing Initial Revenue
• (47:14) – Contact Information for Ryan Allis

Transcription

[00:00:00.080] – Ryan Allis
Once you know what your target customer acquisition cost is by triangulating the 1 6th of LTV and 50% of ACV and finding the midpoint there, then you can go out and start doing paid customer acquisition. The holy grail to scaling is paid customer acquisition. Email that’s going out doesn’t provide value. You need to provide value, and it needs to go exactly to your target market who you know has the problem that your software solves. Don’t just start with a 1000 leads or 5,000 leads that’s thinking small. Get everybody in your target market. Spend 2 weeks doing nothing but getting a list of everybody in your target market. If you need to spend $5,000 on it, spend $5,000 on it. Once you have that list, start reaching out to people and start showing ads to those people.

[00:00:52.330] – Joran
In today’s episode, we’re going to talk about how to grow a B2B SaaS from 1,000,000 ARR to a $100,000,000 exit. We’re going to do this with Ryan Ellis. Ryan is the CEO and founder of SaasRise, which is a community for SaaS founders growing to 1,000,000 to a $100,000,000 in ARR. Before this, he founded iContact, which he grew in 10 years from 0 to $50,000,000 in AR with 70,000 customers, 1,000,000 plus users, and sold it for a 169,000,000. Now he helps SaaS CEOs to do the same with his community, his digital ads agency, and coaching services.

[00:01:25.380] – Joran
Welcome to the show, Ryan.

[00:01:27.060] – Ryan Allis
Thanks. I’m excited to be here today.

[00:01:29.780] – Joran
So we’re gonna talk about going from 1,000,000 ARR to a $100,000,000 exit. Maybe a super basic question, should a SaaS founder always be aiming for an exit?

[00:01:40.740] – Ryan Allis
I think the 2 options are either an exit or a long term cash flowing company. Either’s fine. But because technology is so disruptive, you can have a cash flowing company 1 year and then be outcompeted the next. In a high growth rapidly changing industry like technology, I think it’s helpful to think about things in terms of let me build for 5 to 10 years. Let me sell, and then let me go build something else.

[00:02:05.620] – Ryan Allis
I do think an exit is the ultimate outcome for the large majority of successful technology companies.

[00:02:12.000] – Joran
Yeah. Because in the end, you would never know if the revenue stream will always continue with, the changing market as you mentioned.

[00:02:17.680] – Ryan Allis
That’s right. And you could always become big enough to go public, like a Microsoft type example, or you could do what SAP did in North Carolina and become a very big multibillion dollar privately held software company. But that’s very rare. That’s like a 1 in a 1000000 chance. I think it’s a a better goal to say, let’s go for a 9 figure exit or a $100,000,000 outcomes.

[00:02:38.550] – Ryan Allis
And that’s what I help companies achieve.

[00:02:41.110] – Joran
And before we dive into depth, what is your view on bootstrapping versus VC funded?

[00:02:47.350] – Ryan Allis
I think it’s important to bootstrap for the 1st year or 2 to get to, let’s just call it at least half a1000000 in ARR before considering any substantial outside capital. I think it’s important to say no to institutional capital until you’re large enough, growing fast enough, and have a good enough negotiating power to make the terms good. So what we did at iContact, we got to 1,000,000 in ARR, and then we raised our first outside capital. We bootstrapped all the way to 1,000,000, and then we raised $500,000 A year later, we raised 7,000,000 and then 5 years later, we raised 40,000,000. We never raised more than 1 times our ARR, and that was very helpful to minimizing dilution and maintaining control.

[00:03:32.650] – Ryan Allis
Interesting.

[00:03:33.050] – Joran
And I guess the main reason for you as well, as you mentioned, get to the 5 100 k ARR yourself first is to get yourself in a good negotiation position.

[00:03:40.450] – Ryan Allis
That’s right. And the other thing is if you raise institutional capital, venture capital, and don’t succeed. In other words, you don’t grow in the 18 months after you raise the capital because you raised it too soon before you build build your growth engine, then you’re ensuring that the common shareholders, including yourself as founder, are gonna get nothing. And so ultimately, if you raise money at a $20,000,000 valuation early on, and then you can’t sell your company for more than 20,000,000, the common shareholders are gonna end up with nothing. And so you gotta be careful about going after the highest valuation early.

[00:04:19.850] – Ryan Allis
And what you wanna do instead is build up revenue. Instead of spending 6 months trying to sell venture investors, spend 6 months getting to 500 k, $1,000,000 a year of revenue. And then the venture investors will be easy and they’ll be willing to give you terms that are good.

[00:04:33.630] – Joran
Maybe even the tables are turned, they will come to you instead of you having to change them.

[00:04:38.030] – Ryan Allis
Exactly.

[00:04:39.950] – Joran
Cool. Let’s start the fun part. What is the most common mistake SaaS companies make while trying to grow their business?

[00:04:46.760] – Ryan Allis
Common mistake. I always look at it the other way. I always look at what are the most effective ways to grow a SaaS business? So I’ll answer that question and then I’ll try to back into the mistakes. I think the most effective ways are, number 1, start making make sure you got a great product that is easy to use.

[00:05:01.960] – Ryan Allis
So maybe the inverse of that would be not investing enough in UI UX initially to make sure the product solves a real problem and is easy to use. So that would be the first thing. The second thing is once you have a product with good UI UX that solves a real problem, make sure you tell a lot of people in your target market about it. And so not doing enough outbound marketing is something that I see as a big mistake within b to b SaaS. And what I mean by that is, let’s say you’ve made software for warehouses.

[00:05:35.390] – Ryan Allis
Just pick your niche, pick your vertical, whatever your vertical is. There are probably a 100,000 warehouse owners, CTOs, CIOs, go whatever in your vertical. Find your job title likely to buy, and then reach out to those people and let them know about your solution. Educate them on the value of it. Make sure they understand that you are here, that you understand their problem.

[00:05:57.650] – Ryan Allis
You have an empathic awareness of their situation, of their problem. And then just offer them a free trial of it. Offer them an interactive demo of it of it. Offer them a PDF that’s actually valuable that educates them. Offer them a case study.

[00:06:09.570] – Ryan Allis
And so not doing enough outbound marketing to let the market know about your solution is another big mistake.

[00:06:16.690] – Joran
Yeah. Nice. And you’re giving also the answers already what they should be doing. You’re a growing community. Right?

[00:06:22.930] – Joran
How many members do you have right now?

[00:06:25.040] – Ryan Allis
We’ve got 400 active members of SaasRise. It’s a community for SaaS CEOs and founders with between 1,000,000 and a 100,000,000 in ARR. So it’s a community for experienced CEOs and founders. And, we started a year ago, and we have over 400 active members now.

[00:06:42.280] – Joran
How important is it for a SaaS founder to actually have a community like this? People similar to yourself around you.

[00:06:49.960] – Ryan Allis
There’s 2 problems. 1 is people are lonely when you’re at the top, when you’re building something. It’s hard to get clear, good advice from people that haven’t been in your shoes before. Your investors are conflicted. Your employees might not have the experience.

[00:07:04.930] – Ryan Allis
Your spouse might not have the similar experience. And so where can you get great advice that’s highly relevant to your industry? And that’s why we’ve built SaasRise to make it easy to get feedback, recommendations, referrals, advice, guidance, growth tips. So that’s the first thing. It’s lonely, and it’s hard to find advice.

[00:07:24.160] – Ryan Allis
And then the second thing, there are a lot of forums out there. There are a lot of mastermind groups that are across industry. I’ve been in EO and YPO and those types of forums where you sit there for 3 hours a month with the same group of 6 to 8 guys. And they’re great. I I recommend them.

[00:07:39.860] – Ryan Allis
But ultimately, what I struggled with when I was building eye contact for 10 years was getting a group of people who were actually building B2B SaaS companies to support me and guide me. And so that’s what we’ve built with SaasRise.

[00:07:53.250] – Joran
It’s super specific towards B2B SaaS companies. When we talk about the community, I know you also created a course, which is called the SaaS growth system, which I wanna dive into this podcast. So could you walk us through maybe the growth system, however you would like?

[00:08:08.850] – Ryan Allis
It’s really simple. At the highest level, number 1, you need to understand your unit economics and how much your customer is worth to you. Once you understand how much your customer is worth to you, which I can go into if you want, then you do ads and outbound reach outs to then reach out to your target market, generate more customers within your customer acquisition targets. And then you once you’ve figured out how to find a scalable channel, you raise outside capital as necessary to scale up the channels that are working. And then once you’ve reached, say, 20, 30,000,000 in ARR, then you start to think about how to build the systems in place to really build a professionalized business, and then you think about exiting for 9 figures.

[00:08:51.520] – Ryan Allis
That’s the high level of the system, unit economics, customer acquisition, outbound, paid, capital scaling, and exiting.

[00:09:00.170] – Joran
Yeah. And I wanna dive deeper into every topic. So when you talk about you unit economics, what do you mean? What should people prepare in this stage?

[00:09:09.610] – Ryan Allis
There’s about 4 or 5 critical metrics that every SaaS founder CEO needs to know. The first 1 is average revenue per account. You need to know how much revenue an average customer pays. You can just divide total revenue by total customers to get that number. And then that would be on a monthly basis.

[00:09:29.900] – Ryan Allis
If you’re doing it on a monthly basis, it’s called ARPA. If you’re doing it on an annual basis, it’d be called ACV or annual contract value. The second metric you need to know is you need to know your monthly account churn. You could do this annually or monthly. But for the sake of example, we’ll do it monthly.

[00:09:46.320] – Ryan Allis
Let’s say that you’ve got a 100 customers and on average, 3 churn per month. And then you’ve got a 3% account churn rate. Now, if you have a 3% account churn rate, now you need to know how long an average customer stays, and you can approximate it really closely by taking 1 divided by the churn rate. So if you do 1 divided by 0.03, that’s about 33 months of life. And so you simply multiply your ARPA, your monthly revenue per account, times your lifespan, the number of average months a customer stays before they churn, and that creates your lifetime value, your LTV.

[00:10:24.100] – Ryan Allis
Once you know your LTV, then not only do you know how much your customer’s worth, but then you can approximate how much you’re willing to spend to get an incremental new customer. And a good rule of thumb for most SaaS companies is about 1 sixth of LTV. So if your LTV is $10,000, then you could probably spend about $1600, 1 6th of that amount, to get an incremental new customer in the door. If your LTV is a $100,000, well, then you could spend about $16,000, 1 6 of it, to get that new customer in the door in terms of sales and marketing expenses to get that incremental customer. Another way to approximate your target CAC would be about 6 months of revenue.

[00:11:07.220] – Ryan Allis
If you’re, let’s just say your average annual contract value, your ACV, let’s just say that’s $20,000 then you could spend about $10,000 to get an incremental new customer in terms of sales and marketing costs per new customer. So once you know what your target customer acquisition cost is by triangulating the 1 6th of LTV and 50% of ACV and finding the midpoint there, then you can go out and start doing paid customer acquisition. The holy grail to scaling is paid customer acquisition. You can do your SEO and your inbound, and that’s very helpful in growth hacking in the 1st 6 to 18 months. But when you’re ready to scale from 1,000,000 to 10,000,000 that you really do need paid.

[00:11:49.900] – Ryan Allis
And the difference between a 3,000,000 ARR SaaS company and a 30,000,000 ARR SaaS company is that they’ve figured out how to make paid acquisitions scalable. And there’s really only 2 major categories of paid customer acquisition, outbound reach outs and advertising. Outbound reach outs via email and LinkedIn. You could even do cold calling or ringless voicemail after ECV sign up. And then paid advertising on Meta, Google, LinkedIn, AdRoll, and Bing.

[00:12:19.510] – Ryan Allis
And what you do is you invest in these channels. You don’t do them all at once. You test them and make them work 1 at a time and figure out how to make your actual customer acquisition costs lower than your target customer acquisition costs. What I just said there is hard to do in practice, but in theory, it’s simple. You figure out your target CAC and then you acquire customers lower than that target.

[00:12:42.720] – Ryan Allis
And if you can do that, then you’ll end up with a 30, $40,000,000 SaaS company within 3 or 4 years.

[00:12:48.600] – Joran
Yeah. You make it sound so easy. And I guess for people listening and, like, you have no idea how to get your unique economics tools like ProfitWell, give you these kind of numbers already, a bit out of the box. Do you recommend any other tools for people to use to get these numbers?

[00:13:03.440] – Ryan Allis
Yeah. We use them all. ProfitWell is nice because it’s free. SAS Grid is free. We use Baremetrics.

[00:13:09.840] – Ryan Allis
We pay a little bit for that, but it’s really good. We’ve used ChartMogul in the past. So all 4 of those tools are really helpful for helping you calculate your unit economics by integrating your billing system, integrating your Stripe, and then just outputting the result.

[00:13:25.390] – Joran
Yeah. Because in the end, you don’t have to do everything manual. There are tools which can help you with that. This is probably going from step 1, preparing to step 2, outbound. You mentioned you can do email, LinkedIn calling, or you can do paid ads.

[00:13:38.810] – Joran
You mentioned it is the holy grail to scaling. I wanna dive deeper in here. Step 2, outbound. What else can you tell what SaaS companies should, shouldn’t do? I already mentioned experimenting.

[00:13:50.120] – Joran
What kind of advice would you give here for step 2?

[00:13:53.400] – Ryan Allis
Let’s talk about outbounds. The biggest differentiator between B2B SaaS companies that scale and those that don’t. Those that don’t are sitting there waiting for the market to show up. And those that do scale are very aggressive with going out and educating the market proactively. Now, how do you do that?

[00:14:18.270] – Ryan Allis
First thing you need is you need a list of everybody in your target market. It’s simple as that. How do you build a list of everybody in your target market? That’s pretty easy. You go on to a lead prospecting tool like apollo.

[00:14:33.790] – Ryan Allis
Io, instantly, zoominfo, listkit, seamless dotai, LinkedIn Sales Navigator. There’s a 100 of them. And you go put in your industry, job titles, geography, and target employee count, and you export a list of everybody in your target market. There might be 50,000 of them. There might be 200,000 of them.

[00:14:57.870] – Ryan Allis
There might be a 1000000 people in your target market. Usually, in b to b SaaS, there’s somewhere between 50,000 a 1000000 people in your target market. It’s not b to c where you might have 20,000,000 potential consumers. It’s more like 50 k to a to a 1000000 at most. In our particular industry is what we go after.

[00:15:14.580] – Ryan Allis
Our target addressable market is b to b SaaS founders and CEOs with at least a1000000 in revenue. There’s about 300,000 of of those people that fit that criteria in the world. So we went on to Apollo. Io, exported the list of everybody that fit those criteria, went on to instantly did the same thing, went on to Lucia, ZoomInfo, Wiskit, Seamless, LinkedIn Sales Navigator, PitchBook, Adapt, and exported a comprehensive list of everybody using 8 or 9 of these different tools. Now once you have what I call your lead list, you might also call that your ABM lead list, your account based marketing lead list of everybody in your target market, That’s the big first step.

[00:15:54.680] – Ryan Allis
And the question is, what the heck do you do with 200,000 or 300,000 people who are in your target market? There’s 2 things you do with that list. The first thing you wanna do with that list is you wanna upload it to the ad networks, to Meta, to LinkedIn, to Google, to AdRoll. And you wanna create what’s called a matched audience, sometimes called a custom audience. About 30 to 60% will usually match depending on the ad network.

[00:16:21.430] – Ryan Allis
And then what you wanna do is start showing ads to people who are in your target market. And, you combine that with the second step I’m about to tell you, and it’s very powerful. The second step is once you have ads going to this matched audience of people who are in your target market, then you start setting up cold email sequences using a tool like Instantly to go out to the same people that you’re showing ads to. This is how you make your brand omnipresent. And you could do this for Reditus.

[00:16:52.290] – Ryan Allis
I’m sure you already do some of this. You could do this if you’re a listener for your B2B SaaS company. And you go onto a tool like Instantly. There’s probably 20 others that are these outbound, marketing sending tools. And you set up educational sequences that, provide value.

[00:17:09.230] – Ryan Allis
And that’s the key. There’s too much email that’s going out that doesn’t provide value. You’d need to provide value, and it needs to go exactly to your target market who you know has the problem that your software solves. So once you have your list in uploaded, you start create a 5 email sequence and you start sending it out every 2 to 3 days. And then you start seeing who’s engaging with the content, who’s clicking on it, who’s downloading your PDFs.

[00:17:34.870] – Ryan Allis
You take those people that are engaging with your content and downloading your marketing materials, and you put them onto a warm sequence, onto a weekly newsletter. And then that’s how you very quickly can take a cold list of 2, 300000 people in your target market and turn it into a warm email list of 20, 30, 40000 people within 2 or 3 months. That’s the high level of how to do it.

[00:17:58.710] – Reditus Ad
Are you struggling to find people and companies which have access to your ideal customer profile? At Reditus, we just launched a second site of the marketplace, which allows you to search, filter, and contact b to b SaaS affiliates which have access to the audience you’re looking for. We do this by leveraging first party data sources. Wanna learn more? Go to getreditus.com.

[00:18:19.880] – Joran
You mentioned at the beginning, start experimenting. Getting a list of 200,000 companies might be, a long thing to do, and, you’re not gonna run ads on all of them right away. How would you recommend people to get started with this? So out of that big list, take a small chunk and have that as an experiment? Or

[00:18:40.840] – Ryan Allis
I I think that is not how I would do it. The way I would do it is I would define as carefully as I can who is my target market, and then I would get all of them. So let’s just say, for example, there’s 200,000 people in your target market, in your geography with job titles of people that you target. The le email lists are as expensive as they used to be. We we have data brokers that have unlimited subscription enterprise accounts with Apollo that will offer their Apollo dot io, the lead prospecting platform that will offer $600 per 100,000 records.

[00:19:19.000] – Ryan Allis
So to get a list of 200,000 So to get a list of 200,000 people, maybe you’re looking at $1500. Maybe you’re looking at the most 3 to $4,000. Now if you’re a 1 guy bootstrapped and you don’t got 3 or $4,000 okay, fine. Start with a subset of the list. But if you’re a company that’s got 3, $4,000 you can invest in leads, buying a list that’s comprehensive of everybody in your target market is probably the least expensive thing you can do in terms of the ROI it’s gonna produce.

[00:19:54.520] – Ryan Allis
And so I would highly encourage everyone to, don’t just start with a 1000 leads or 5,000 leads. That’s thinking small. Get everybody in your target market. Spend 2 weeks doing nothing, but getting a list of everybody in your target market. If you need to spend $5,000 on it, spend $5,000 on it.

[00:20:12.510] – Ryan Allis
Once you have that list, start reaching out to people and start showing ads to those people. And we’ve invested at SaaSrise. We’ve scaled from 0 to 3,000,000 in ARR at SaaSrise in the last 12 months, going from nothing to $3,000,000 a year in recurring revenue. And we’ve done that by implementing and utilizing the exact 3 step system that I just talked about. Know our unit economics, build our ABM lead list, and then do outbound marketing and ads.

[00:20:39.900] – Ryan Allis
And so I I would just encourage you if you’re if 3, 4, $5,000 is too much money, then fine. Start with a list of 10,000 and run the system and get it to work, get your first few customers, and then go get your next 20,000 and then expand from there. But if you’ve already at 500,000 ARR, if you’re already at a 1,000,000 ARR or more and you can invest, this is the thing you wanna put 5 or $10,000 into to to be able to get many more customers coming in the door.

[00:21:07.670] – Joran
And would you then also start running ads on all of them and start sending out the emails to all of them? Or would you chop that up?

[00:21:15.460] – Ryan Allis
Here’s my math on it. So if you’ve got a list of 200,000 target leads and you wanna throw in 30,000 a month 30,000 leads a month. 30,000 leads a month take about 6 to 7 months, right, to get through 200,000 people. So you can go on any of these outbound sending tools like Instantly, Apollo, SalesLoft, Outreach, Gong Engage, any of these tools. We like Instantly because they do the email warm up and make it easy to get inboxes for you.

[00:21:46.900] – Ryan Allis
You can, set up a system for not that much money, maybe 1,000 to $2,000 a month that will be able to bring in automatically on autopilot a 1,000 leads a day. And I think that’s a good number to go after a 1,000 cold leads a day coming into the top of your marketing funnel. That will definitely move the needle. If you’ve created a very valuable 5 email sequence with with really good case studies, really good PDF reports, really good survey summaries, something that’s actually useful, not just a 1 liner saying, hey, book a demo, but something that actually educates the the consumer, the the customer on the problem and the solution you have, and makes them problem aware and solution aware, then go ahead and set up as your evergreen systems that you’re bringing in a 1000 leads a day automatically into a tool, like, instantly to send out the sequence. And, yes, that is gonna take 6 months to go through, but I think it’s better to just do it all as a batch.

[00:22:47.210] – Ryan Allis
Get your 200,000 leads, and it might only be 50,000 for for your company. Go get your full list of leads of everyone in your market. Upload them as a matched audience. Start serving ads to these people because it’s often gonna take 2, 3 months of showing ads to these people before it starts to register. You need to make 20 impressions usually before people will start to pay attention.

[00:23:07.090] – Ryan Allis
And those impressions will come via ads and outbound email. And yes, it might take 6 months to email them all, but that’s okay. Think about it as market education and you’re moving people down a funnel where they started out as strangers and then you build awareness, interest, desire, action, and then they purchase and then you expand. And so that’s the SaaS marketing funnel. And so I would do it all at once.

[00:23:28.470] – Ryan Allis
We don’t spend a lot on sales and marketing. We spend about $15,000 a month for a company. We’re about 300,000 a month in revenue. So at 300,000 a month in revenue, spending about 5% of that on sales and marketing, 15,000 a month. For not a lot of money, we’re able to reach 3, 400,000 SaaS founders continually and invite them to join our community and provide really valuable content to them.

[00:23:53.350] – Ryan Allis
So that’s our philosophy of it. Are we more aggressive than most? Absolutely. And that’s probably why our revenue is growing faster than most.

[00:24:00.310] – Joran
Yeah. Yeah. And I can fully rate. I think I got into your funnel by either connecting with you on LinkedIn, then I showed interest on the site, then you start seeing your ads. And at 1 point, you get your emails because I probably signed up somewhere.

[00:24:12.700] – Joran
They’re all value based. You have all these sessions you do, which you shared in the newsletters, which is really nice. This is how I got you on my podcast. I really need to guess Ryan now because there’s so much knowledge there.

[00:24:23.630] – Ryan Allis
Yep. That’s exactly right. Provide value in brand omnipresence. And if you’re a technical founder, find someone to partner with, whether it’s a head of marketing or a co founder who likes creating content. And there’s only 2 ways to create content, video and writing.

[00:24:40.210] – Ryan Allis
1 of the 2. And you can turn writing into video and you can turn video into writing, start with a video podcast like this that are video that can be transcribed and then edited into long form written content or short form written content, or start with long form writing content. Either way, there has to be a single person in your organization who is expert level, who has the experience necessary to spend about 3 hours a week creating content. And if you can spend 3 hours a week creating content, your marketing will take off.

[00:25:09.140] – Joran
Nice. Does it gonna line up pretty well with, I think the next step? Because the next step is inbound. Right?

[00:25:15.140] – Ryan Allis
That’s right. And I call it the SaaS content machine. You wanna build your B2B content machine. The key to this is to set aside about 3 hours on your schedule and it doesn’t have to be you, but ideally it’s the founder CEO. And to spend about 3 hours every Monday, either recording video content or writing long form content.

[00:25:39.930] – Ryan Allis
Now there’s a lot of things you could be doing. You could be hiring staff, you could be raising capital, you could be doing a lot of things, but ultimately creating high quality content that educates your marketplace is the number 1 thing that will drive more revenue for your business. And driving more revenue for your business in B2B is critical. If you’re at 10,000,000 ARR already, great. You can out source this and have someone else create the content.

[00:26:07.360] – Ryan Allis
But if you’re in that 0 to 10,000,000 ARR, there’s nothing better you can do with your time as a founder CEO than spend 2 to 3 hours a week just creating killer content that truly demonstrates mastery of the field. And then distributing that in multiple formats, be it your email newsletter, your cold email sequences, your ads, your LinkedIn posts. That is the way to scale up awareness of your brand.

[00:26:34.820] – Joran
Yeah. And as you mentioned, you can do it in multiple different ways. For example, we’re recording this on Monday morning. I don’t know if this is within your 3 hour bucket, but you’re spending an hour to record a podcast, which you can turn into a lot of small form content if you want to.

[00:26:49.510] – Ryan Allis
Yep. That’s exactly right. I’ve got my 3 hours later this afternoon, and I’ll be writing articles and distributing them to our Beehive newsletter list. We’re able to get about 1,500,000 total content impressions per month within our target addressable market. And so if our audience is 300,000 possible SaaS founders, that means that they’re seeing our content 5 times a month.

[00:27:12.880] – Ryan Allis
What do I consider a content impression? In the realm of making our brand omnipresent, what I consider a content impression is an ad impression, a LinkedIn impression by that, a post that gets seen an email open or a website view. So, you know, those are the 4. And you can add a 5th if you do, like, YouTube videos or Wistia videos or Loom videos. You could add that.

[00:27:37.670] – Ryan Allis
So that ad impressions, LinkedIn organic impressions, email opens, not sends because they’re not all seen, but the opens, the ones that are actually seen, website views, and then video views. Those 5 categories are the cat 5 categories of content. And if you can just calculate once a month, take 20 minutes to do it, the number of impressions for your ads, your LinkedIn posts, your email opens, your website views, and your video views, and then just add that up. I promise you the difference between a fast growing B2B SaaS company and a slow growing B2B SaaS company is that the slow growing company is probably gonna have 20,000 content impressions a month. And the fast growing B2B SaaS company is gonna have a million.

[00:28:23.450] – Ryan Allis
And that’s gonna be the difference. Now how do you get a 1,000,000 impressions of your content? Do you have to spend 1,000,000 of dollars? No. We spend $15,000 a month on sales and marketing, about 10,000 on ads, and about 5,000 on a sales team.

[00:28:36.790] – Ryan Allis
So $10,000 on ads is getting us about 600,000 impressions per month. Where do the other 6, 7, 800,000 impressions come from? We’ve built a very big email list. We get about 6, 700,000 impressions per month opens per month of our email content that we send out, between warm and cold. Most of it’s warm, but cold is a significant percentage as well.

[00:29:02.190] – Ryan Allis
Not that many. We get about 20,000 to 25,000 website views a month. We get way more email views. Lastly, we get maybe 10,000 video views a month. Between all of those, we’re getting about 1,300,000, 1,400,000 content impressions per month right now.

[00:29:18.270] – Ryan Allis
We’re making our SaasRise brand omnipresent within our target market. Regardless of your target market, you can do the same thing.

[00:29:26.110] – Joran
Yeah. Yeah. And what you mentioned before, like, when you were doing outbound, you’re guiding people into leaving their email, building up your own audience, making it omnipresent as you mentioned. So you can lead with the paid part and then work their way into your organic channel.

[00:29:42.310] – Ryan Allis
That’s exactly right. I think the key just to recap is start with a cold list of all the possible leads that you could have. Build a full list of everyone in your target market. Start sending out cold emails with that are high value, that educate your market, that differentiate yourself versus everyone else, find the people that click and engage, put those people under your warm list, have the second warm sequence that’s more in-depth and has different content, Start sending out a weekly newsletter, not a monthly newsletter with valuable content. Spend 3 hours a week writing great content or recording video.

[00:30:17.740] – Ryan Allis
A great hack is to hire a virtual assistant from a wing assistant or Athena, where you can get someone for $1500 a month or even $700 a month halftime. And just have them write a list of questions for you to respond to on video once a week and have them turn the transcript into valuable content. The key is to make sure you’re soliciting great content from your own brain, either by typing or by speaking, whichever way works better for you. And then having that process of taking that content, turning it into quality PDFs and outputs and reports and videos and LinkedIn posts, have that be proceduralized through a standard operating procedure that that every single week allows you to have 1 blog post, 1 email post, 2 or 3 LinkedIn posts, and a new ad set. If you can do that, you’ll win.

[00:31:04.170] – Joran
Yeah. And and what I really get out of this as well, like you mentioned a couple of times, Monday, you blocked it in your calendar, so you’re super consistent with it because on Monday, you have 3 hours to really do this. And you mentioned as well, if you keep doing this, you’re gonna win. So consistency is gonna be key here as well. That’s right.

[00:31:21.930] – Joran
Cool. Let’s move over, to the next step, which I believe is scaling.

[00:31:25.860] – Ryan Allis
Absolutely. In in the realm of scaling, you need to hire team. You need to hire leadership. You need to hire c level executives. You need to have systems, benchmarks, KPIs, performance reviews.

[00:31:38.700] – Ryan Allis
You probably need a CFO or maybe a COO. It’s fun. The first 0 to 10,000,000 is all about growth hacking, product building, and finding a way to get through to solving a problem that matters in the world to people. Once you get to 10,000,000, it’s like starting a whole new game. It’s like going from college football to the NFL.

[00:32:00.740] – Ryan Allis
You have to learn a whole new playbook. The thing that got you from 0 to 10,000,000 is not gonna get you from 10 to 50,000,000. What’s gonna get you from 10 to 50,000,000 is building a great team and building great systems that can operate without you. Once you get to 10,000,000 in revenue, you wanna make yourself completely redundant. You want to make yourself, unnecessary in your own company.

[00:32:24.240] – Ryan Allis
It’s funny because in the 0 to 10,000,000, you need to be extremely necessary. You’re creating all this content. You’re doing a lot of the last of the big sales. You’re closing the big deals. You’re reaching out.

[00:32:34.920] – Ryan Allis
You’re doing a lot in the 0 to 10,000,000 in the 1st 3 to 5 years. But once you get to 10,000,000, it can’t be about you anymore. There’s no way to scale as a single individual beyond 5 to 10,000,000 without building a great team. And so who are the key people you need in this scaling phase? You’re gonna need a really great head of sales.

[00:32:55.450] – Ryan Allis
That’s not you. You’re gonna need a great head of marketing. That’s not you. So a great c CRO and CMO. You’re eventually probably around 15 or 20,000,000.

[00:33:05.640] – Ryan Allis
Gonna need a great CFO or controller who’s obviously not you. And you’re gonna eventually, by the time you’re 20, 25,000,000, you’re gonna need a great head of HR who can handle recruiting all the people you’re bringing in at eye contact. We were hiring 10 people a month. To hire 10 great people a month, 2 to 3 a week, you need a system for recruiting. And then you need a system for compensating and evaluating the performance of all the existing people you have on your team.

[00:33:33.770] – Ryan Allis
And so this is where you wanna build a system that can operate while you sleep. The key to making a lot of money is to make money while you sleep. Key to making money while you sleep is to build systems that can operate without you. In this phase, this sort of phase 2 of a business going from, I guess, phase 3. Phase 1 is product market fit 0 to 1,000,000.

[00:33:53.950] – Ryan Allis
Phase 2 is 1 to 10,000,000 of founder led growth. And then phase 3 is scaling, and that’s 10 to a 100,000,000 of ARR. In that 3rd phase, you need to build a system that can work without you. I encourage all the CEOs I coach within that 10 to a 100000000 ARR range to take a month off every summer. That is nonnegotiable and in which they will not be checking email, in which the only way to get to them is if their 1 deputy that they have, either their COO or EA, has their SMS.

[00:34:28.170] – Ryan Allis
Like, in a real emergency, they can SMS them. But no Slack, no email, no phone calls, literally take a vacation. They can go start a new company or work on a new project. Great. But don’t do anything within the operations of your existing business for 4 weeks or a full month every summer.

[00:34:46.280] – Ryan Allis
The reason why you do that is because you have to find where the points of failure are, and you have to find where the business can’t scale without you. And the only way to identify the areas that require you is to leave. So that it’s just, hey, we tried to do this thing and there wasn’t the right protocol in place to make the decision. Or we needed this password and it wasn’t saved. You need to figure out how to get the business to grow.

[00:35:11.880] – Ryan Allis
And the idea is you take a month off and the business, when you come back needs to be stronger and it needs to be bigger than when you left. If you keep doing that every year, your team will make sure that they develop systems that don’t require you. And that’s what you want. You want at that phase to have systems that don’t require you. Once you get to that 20,000,000, 30,000,000, 40,000,000 in ARR range, which is hard, but it is definitely doable.

[00:35:36.000] – Ryan Allis
That’s when you start to think about exiting, which is of course the next phase, which we can talk about. But that’s when you start to think about, do you test the market? Do you get an M and A advisor? When’s the right time to sell? So those are the steps so far.

[00:35:47.800] – Ryan Allis
Figure out unit economics, figure out what you can pay to acquire a customer, do outbound, do paid advertising, do inbound, create your growth machine, raise capital if necessary, start scaling by building a system that can operate without you. And then the last step, think about when the right time to exit is.

[00:36:03.140] – Joran
Yeah. 1 question I would wanna ask, which you went over quickly, capital. So we went from scaling almost to exit. Right? What do you recommend for capital wise?

[00:36:12.950] – Joran
So we first mentioned to grow to 500 k ARR yourself. Once it is time to raise capital, what would you recommend SaaS companies to do here?

[00:36:22.650] – Ryan Allis
Yeah. So there’s many phases in a company’s life. I think delaying the venture capital until you’ve got at least 500 ks in ARR is critical. I would even encourage companies to delay it till you got a 1,000,000 in ARR. Is it annoying to wait to raise capital?

[00:36:39.570] – Ryan Allis
Absolutely. It’s so easy to just go and raise a $1,000,000 or $2,000,000 from an venture investor. But I promise you there are hidden things in their term sheets and definitive agreements that will screw you if you don’t continue growing very quickly. And in some cases, you’ve got a rocket ship, and you could keep growing at a 150% a year for 5 years, and you’re fine. You can outgrow those down round provisions or those anti dilution provisions or those preferred shares that end up screwing you if you don’t keep growing quickly.

[00:37:13.660] – Ryan Allis
But in many cases, I can’t tell you how many situations I’ve heard of of SaaS companies that in 2021 raised money at 15 times revenue that never grew into that valuation. 3 or 4 years later, they still can’t raise capital at that valuation. And the second they go and raise money at a lower valuation, it basically gets rid of their entire common shareholder value. Long story short, wait until you’ve got your growth engine built and putting in an extra 3, 4, 5, 6,000,000 in outside capital can actually turn into multiples of that in terms of new revenue. Build your paid ad system, build your outbound system, build your inbound, nail your SEO, nail your review sites, get the trade shows going, get your affiliate system going.

[00:38:00.290] – Ryan Allis
Once you have your channels working and you’ve got a million plus in ARR and you’ve got product market fit, then go out and raise the outside capital. That’s the first part. The second part is some companies never need venture capital because they’re growing quickly and profitable. If you’re growing at 50% plus a year and you’re profitable, you might not need venture capital. But if you exist in an industry that is highly disruptive, highly innovative, fast moving, and you wanna win, having that access to institutional venture capital, if your gross rate can support it and you know how to spend it, can allow you to get the team and to put money into sales and marketing and put money into the R and D necessary to actually win in the marketplace.

[00:38:46.850] – Ryan Allis
The question really becomes when do you do the series a, how much, when do you do the series B and how much? And my rule of thumb is simply this Don’t raise more than 1 times your ARR. So if you’ve got a 1,000,000 ARR, raise a million. If you’ve got 5,000,000 ARR, raise 5,000,000. If you’ve got 30,000,000 ARR, raise 30,000,000.

[00:39:04.850] – Ryan Allis
But don’t do what certain companies do. And at, say 10,000,000 in ARR, they go out and raise 50, 60,000,000 because you’re going to give up way too much equity, way too much control. And if you don’t keep growing and you’re wrong about whether you can spend that money to generate more customers and more revenue, you’re going to end up with nothing. You don’t want to take that risk where you take this company that you could just sell right now for 30,000,000 and end up taking a risk and keep 80% of it and ended up taking a risk where you raise that money because you’re trying to get that $1,000,000,000 exit, but then you end up actually with 0. And I’ve seen that happen way too often.

[00:39:43.880] – Ryan Allis
So be thoughtful. Don’t raise more than about 1 X your ARR and to make sure you put that capital that you raise into sales and marketing and R and D into projects that will actually generate more revenue. So I can go into more detail on that, but that’s the high level about what I think about raising on-site capital.

[00:39:59.770] – Joran
I think we are gonna move on to the final step, which is exit. The podcast title is gonna be the path to a successful $100,000,000 plus SaaS exit. Yep. How do we get there? Tell us about the exit.

[00:40:12.200] – Joran
What kind of advice would you give here?

[00:40:15.080] – Ryan Allis
The first step to a successful exit is building a SaaS firm to at least 3, 4,000,000 in ARR. You can exit a 1 to 2000000 ARR firm on a marketplace like acquire.com or Flippa or BizBuySell or Empire Flippers or Niche Investor, something like that. But you’re not going to get a great multiple. You might get 1 to 2 X your revenue. That’s fine.

[00:40:38.050] – Ryan Allis
5,000,000 can be life changing money, particularly if you own all of it. Don’t be afraid of hitting singles and doubles. If you can get your revenue above 3 to 4000000 a year, then what it does is it opens you up to higher multiples and more professional investment advisors that can help you sell multiples and more professional investment advisers that can help you sell and access a much bigger, broader swath of the marketplace. If you can get to that magic number, which I like to say is 5,000,000 in ARR, you can really sell your company for a good price. There are within our community, of course, as you mentioned, the SAS Growth System course, which is free for SASRise members.

[00:41:12.870] – Ryan Allis
And in that, we have a slide. And on that slide, we list all of the M and A advisors that work with companies in SaaS based on their current ARR. If you’re in that $5,000,000 range, you could work with firms like Aventus Advisors, Software Equity Group, FE International, Embark Advisors, Livmo, Bupos, some of those firms. Reach out to them, have a conversation. They’ll tell you what they think you’re worth.

[00:41:36.270] – Ryan Allis
They’ll probably take 3 to 5% of the deal, probably a little bit higher since it’s a smaller deal. And they’ll tell you, can you sell for 15,000,000? Can you sell for 30? Somewhere around 3 to 5 x revenue is possible when you’re at that sort of 4 to $6,000,000,000 range. Now, if you can get your ARR over 10,000,000, you’ve entered into a 3rd tier and that’s where you can work with what I would call real investment banks, firms that are licensed, firms that are going out and running a professional tight competitive process.

[00:42:10.120] – Ryan Allis
We have relationships with firms like Influence Partners, Agile Equity, Elantra, Lightning Partners, Comcast, firms that will represent your firm well, reach out to potential private equity buyers and strategic buyers and get a competitive process done where you’re getting multiple term sheets and offers to buy your company all at the same 2 week period that will allow you to negotiate those term sheets, optimize them, and get a revenue multiple, EBITDA multiple, and ultimate enterprise valuation that is materially higher than what you might get on your own if you ran the process yourself. So I’m a big fan of using an investment bank. Oftentimes, you’ll get 20 to 30% more money that way. And so the 3% that you pay to the investment bank as their fee ends up being more than worth it. Once you get to roughly 10 to 20,000,000, that’s when a $100,000,000 exit in ARR.

[00:43:08.060] – Ryan Allis
That’s when a $100,000,000 exit becomes possible. Happy to talk more about that, but that’s the key. Grow your revenue, build a system, decide if you’re gonna sell based on revenue multiple or EBITDA multiple, which we can talk about, and then find the right investment bank, run a process, and exit.

[00:43:22.950] – Joran
Yeah. Because I think what you mentioned, Tara, like, the 2%, a lot of companies probably don’t wanna work with an investment bank when they see the fees they have to pay. But you also mentioned you could actually get a higher, value for your company if you started working with them, but it’s more than money well spent.

[00:43:39.400] – Ryan Allis
It’s basically free because just to briefly touch on that, if you run the process yourself, you’re not gonna have the time or expertise or credibility to guide M and A teams at these large private equity funds and these large corporate acquirers on telling them what the timeline is gonna be. Whereas if you’re an investment bank and you have relationships and you’ve done 20 deals with these people already, you can say on November 25th, you need to have your best and final offer in. And if you don’t, you’re not gonna be able to participate in the actual purchase. Whereas if you’re just an individual founder trying to tell some $200,000,000 private equity firm this stuff, they’re gonna laugh at you. Their credibility comes from their relationships, which comes from their experience and deal volume.

[00:44:24.590] – Ryan Allis
And you just don’t have that as a founder. I would strongly encourage people to just say that 3% fee, you’re gonna make that back 5 times by just finding the right people to work with.

[00:44:33.550] – Joran
Makes sense. We’re gonna dive into the final question. I’m gonna dive into the revenue stages. We covered more than 1 to 10,000,000, so I won’t I won’t go into that. But what kind of advice would you have SaaS founder who are just really starting out and growing to 10 ks Monday recurrent revenue?

[00:44:49.340] – Ryan Allis
Just get your product launched, start outbounding to cold prospects that fit your target market. Start posting on LinkedIn and start doing some, long tail SEO, like competitor versus you. Start doing some paid search, similar brand terms, competitor 1 versus you. Those are the easy ways to acquire low hanging fruit in customer acquisition.

[00:45:10.210] – Joran
Nice. Thank you. Let me see if I can summarize when you’re going to start out aim for an access as a SaaS founder, but bootstrap the first 500 ks AR, leverage a community because it can be lonely or hard to find advice from other people. Common mistakes is not doing enough marketing, so definitely lead with value or having a bad product. So I guess to turn it around, build a great product, which is easy to use.

[00:45:33.290] – Joran
We’re gonna dive into the growth system. There are 7 steps. 1st 1, prepare, get your u unit economics right. 4 or 5 critical metrics you have to check, ARPA, monthly account churn, LTV, and your target customer acquisition cost, which, I guess, the easy example you mentioned, 6 months of revenue. Then we go to outbound, which is the holy grail to scaling.

[00:45:54.350] – Joran
So think about email, LinkedIn, calling, paid ads, but first, build and export a list of your target accounts, so your ICP. Get everybody in there, upload it to the ad networks, create match audience, build an email sequence, 5 email sequences you mentioned, and here again, provide value, educate the market, turn those into a warm list with a weekly newsletter, another Monday newsletter, then start turning things inbound, build a content machine, map out 3 hours per week, educate your market, but do it yourself as a founder, especially in the early stage, focus on distribution, get content impressions, and be omnipresent. We are going to scale, so 10,000,000 plus AOR, build a great team, processes, systems. They need to be able to operate without you. Ideally, be able to make money while you sleep.

[00:46:43.380] – Joran
How do you make sure that you can do this? Just take a month off in the summer to identify the bottlenecks because they will come up then. Then capital delayed again until 1,000,000 ARR if possible. Don’t raise more than 1 times your ARR, and make the channels work before you start raising. When we look at exits, ideally get the 5,000,000 plus ARR, which is gonna give you higher multiples.

[00:47:06.480] – Joran
And then if you’re gonna work towards 10,000,000 ARR, work with investment banks, and check out all the name Ryan mentioned.

[00:47:14.320] – Ryan Allis
You got it. You did a great job.

[00:47:16.880] – Joran
Cool. If people you mentioned a lot of times, right, SaasRise. If people wanna get in contact with you, what would be the best way to do just reach out

[00:47:23.600] – Ryan Allis
to me, ryan@sasrise. Com, and check out the community atsasrise.com. We welcome anyone who is a SaaS founder or CEO with 1,000,000 or more in ARR.

[00:47:34.950] – Joran
Cool. We’re gonna add your email. We’re gonna add a link towards the community so people can find you so they don’t have to guess how to spell your name. If you are listening right now, please leave us a review on Spotify, and, we’re gonna add a poll to this episode as well. Make sure you let us know what you thought of it.

[00:47:50.670] – Joran
Thanks again for coming on, Arin.

[00:47:52.930] – Ryan Allis
Thank you. Thanks everybody.

[00:47:54.370] – Joran
Thank you for watching this show of the Grow Your B2B SaaS podcast. You made it till the end, so I think we can assume you liked this content. If you did, give us a thumbs up, subscribe to the channel. If you like this content, feel free to reach out. If you wanna sponsor the show, if you have a specific guest in mind, if you have a specific topic you want us to cover, reach out to me on LinkedIn, more than happy to take a look at it. If you wanna know more about Veritas, feel free to reach out as well. But for now, have a great day, and good luck growing your B2B SaaS.