Sales-Market Fit (SMF)

Product-Market-Fit (PMF) is not everything Instead, most SaaS startups should be focused on SMF: Sales-Market-Fit What do I mean with that? The focus on PMF means most companies take a narrow view. To have PMF or not to have PMF. Binary. And if the answer is no, they start changing the product. They should think more deeply about the sales motion instead, and assess whether there is Sales-Market-Fit (SMF). This is true especially for Enterprise-focused SaaS companies, where SMF can be viewed in 3 steps: πŸ‘‰ Getting to Yes - You pitch to a business user. You understood their pain. They even admit it. Then you explain your solution. How do they react? Do they stall, ask for more info, respond in a lukewarm way? Or are they like: YES! That's what I need! Where can I sign? The first step -is to get the user or buyer excited. Getting to "Yes, we need this." SMF1 unlocked. πŸ‘‰ Getting to PO - You might have SMF1, but that's not enough. Often, that's when it starts. The game. The sing & dance. With Procurement. With Security. IT. Compliance. The complex process of navigating all those internal stakeholders. Who don't have your sense of urgency. Who move slooooow. Or even block the deal completely. You'll have to have an 'Enterprise-ready' product. And you'll have to learn to navigate the process if you want to sign that Purchase Order (PO). When you show you can do that consistently & predictably, only then can you say you have SMF2. πŸ‘‰ Getting to Revenue - PO done. ARR booked. But not ARR live. You can't recognise revenue yet. You can't send a bill. First, you have to onboard the customer, deliver the product. Making that as easy & fast as possible is not always easy. One founder I work with calls that "The Happy Path". Not just happy for the customer; also happy for you. Because recognising revenue today is happier than tomorrow. Getting to real Sales-Market-Fit is super hard. Large companies have dedicated teams and processes in place, often referred to as Quote-2-Cash (Q2C). Notice the focus on CASH. It's not just about selling, it's about getting to revenue and cash. You have to take an end-to-end approach: SMF 1, 2, and 3. Next time you discuss PMF with your team? Tell them about SMF Ps. My Partner Harshjit Sethi and I will be discussing more around this at SaaStr Singapore on Feb 23rd Hande Cilingir Serhat Soyuerel Quang H. Tran Grace Sai Nellie Wartoft Ajay Agrawal Andrew Duck Surge Sequoia Southeast Asia Sagar Khatri Prukalpa ⚑Matteo Pelati


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