The most successful Enterprise SaaS companies know that growing revenue only through new customer acquisition is the less efficient way to scale. Rather, they understand that growing revenue within your existing customer base - through up-sells, cross-sells, and expanded use - is the most profitable way to scale. In fact, Enterprise SaaS companies that grow revenue - and company valuation - by expanding revenue within their existing customer base also know the key to making this work is to focus on - and operationalize - Customer Success. This presentation - How to Drive Growth with Customer Success Metrics - is from Pulse 2014, the biggest Customer Success industry event ever and included panelists Aaron Ross, author of Predictable Revenue, Jason Lemkin of Storm Ventures, Tomasz Tunguz of Redpoint Ventures, and Brian Stafford McKinsey.

1. How to Drive Growth with
Customer Success Metrics
Aaron Ross
Predictable Revenue Jason Lemkin
Storm Ventures
Tomasz Tunguz
Redpoint Ventures
Brian Stafford
McKinsey

2. Aaron Ross
Author, Predictable Revenue
• #1 best-seller, called “The Sales Bible Of Silicon Valley”
• Created outbound sales machine @ Salesforce.com
• Helped multiple clients break $100M in revenue
• 4 kids + 4 more on the way

3. Lessons From $1B+: What Customer Success Isn„t
• It‟s not about customer satisfaction
• It‟s not free help
• It‟s not an afterthought

4. It‘s A Growth Driver On Par With Sales & Marketing
Scalable LeadGen Drives Growth
1. Seeds = Customer Success
2. Nets = Inbound Marketing
3. Spears = Outbound Prospecting

5. Show, Don„t Tell, How You Make Money
Example, @ Gild:
1. Renewals
2. Upsells
3. “90 Day Adoption”
4. Product roadmap feedback

6. Jason M. Lemkin
Managing Director, Storm Ventures
• Managing Director, Storm Ventures -- $650m
Investor in SaaS/Enterprise
• SaaStr – Largest Web Community of SaaS
Founders – 600k+ views month
• CEO and co-founder, EchoSign/Adobe
Job Title, Company

7. Hire Early in Customer Success – It Always Works
• One CSM per $2m – But Hired in Advance, Not
Arrears
• Will more reps work? Maybe
• Will more marketing spend work? Maybe
• Will making your customers successful work?
Definitely. Always.

8. Secord Order Revenue – The Key to Long Term Success
• Customer Success is the Most Accretive
Thing You Can Do – In the Medium Term
• All great companies‟ customers come from
one main source – Word-of-Mouth
• This is accelerated, and much more
measurable, in reccuring revenue models

9. Customer Success is 5x More Important than Sales
• Sales is only there at the very start
of the relationship.
• CEOs and Founders – Get on a
Plane and Visit your Customers,
Not Just Your Prospects

10. I Never Lost a Customer I Visited. 5 Visits + 2 Badges Rule.
• Unhappy customers don‟t (always)
churn.
• Unvisited customers that never complain
-- do churn. Need attitudinal, not just
behavioral, loyalty.
• Required: 5 on-sites / month, period. 2
badges from your customers.

11. If You Can„t Measure It, It Doesn„t Exist
• Whole point of Customer Success =
Increasing Net Negative Churn
• Need tools, processes to measure
and improve here
• Can‟t be a soft science. Cannot be.
No best efforts.

12. Tomasz Tunguz
Partner, Redpoint Ventures
• I write about SaaS startups at tomtunguz.com
• Redpoint works with many as-a-Service companies
including Stripe, Twilio, Zendesk, Looker, Infer, Tidemark,
and Expensify
• Former PM at Google; statistics nut

13. Why CS Is Critical
Happy customers, better product
Grow faster
Decrease capital needs

14. Hypothetical SaaS Company
$50k in MRR
50 customers at $1k ARR each
$1250 in CAC, Sales Efficiency of 0.8
Growing 15% m/m

20. How Much to Spend on CS?
Expected Value =
Save Rate x Value of Extension =
30% x 12 months x $83/month =
$298 or about 30% of ACV

21. Return on Investment?
2 pp decrease in churn
- Increases revenue by 50%
- Decreases S&M spend by 30%

22. Brian Stafford
McKinsey

23. Q & A