There comes a time in every founder’s life when you’re sitting there asking, “should we be moving up market in our SaaS business”.
Maybe it’s a random thought because you want to grow faster or you just closed that dream customer and are in awe. That’s when you start to ask yourself what’s possible? All of a sudden the dream becomes bigger. The dream of taking over the world.
But here’s the thing. . .
Going upmarket has its pitfalls. You have to do it the right way (I learned it the hard way).
Here are the three principles you need to know so that you can navigate the path to upmarket greatness and serve at a larger scale.
- Are you already being pulled upmarket?
- Understand the competitive dynamics.
- Company Readiness
So you can stand on a bigger stage and accelerate the growth of your SaaS business.
I remember there was this moment in ToutApp history when we got a publicly traded company to buy a license. We were still a tiny team and very much in the product-led growth mode; starting to get sales people.
That was the moment when we were like, “OMG if a company like that needs ToutApp imagine how many other amazing companies we could be service”.
It’s when we realized we could no longer wait around for companies to discover us. We needed to go out and go upmarket to them. It was very clear.
We didn’t just flip a switch and suddenly were upmarket overnight. It took some trial and error. It was a journey I learned a ton from. So today, I’m sharing the 3 principles to help you navigate this path.
Principle #1: Are you already being pulled upmarket?
The first thing you need to ask yourself is if you’re already being pulled upmarket. There’s a huge difference between wanting to go upmarket and being pulled. This is something you have to be honest about.
If you’re already being pulled into deals by larger companies than your average deal sizes then recognize that. It’s a good sign and the rest of these principles will make a lot of sense.
If no one is doing that yet but you want to go upmarket then it’s a different strategy. The first thing you need to do is start testing a few things:
Talk to companies who are a smidge bigger and see if they still have the same urgent and important problem. Understand the lay of the land.
Regardless, you need to understand the competitive dynamics.
Principle #2: Understand the competitive dynamics.
What I found is in some cases you have such a unique product that the mid-market and enterprise companies are going to come to you and drag you up simply because no one else is doing what you’re doing.
So what are the competitive dynamics?
- Who are the other players in the space?
- Are you the only one?
- Is there a huge gap?
Most importantly, how do you differentiate? Part of our success at ToutApp was we integrated with Outlook and no one else did. It was purposeful because we wanted to serve larger companies who typically use Outlook.
So what you want to understand is between principle 1 and 2, what are the dynamics that are really happening upmarket? Are you being pulled and how can you competitively differentiate from the other players?
Both are important before you embark on the upmarket market journey.
Some companies are super dogmatic about being a product-led growth company therefore will “never go upmarket”. They will get dominated by a company who chooses to serve bigger companies.
The other times you see companies rush upmarket and try to manufacture that demand without thinking critically about the demands at play.
Thinking about the things I just mentioned will save you the agony and dollars of wasted effort.
Principle #3: Company Readiness
Once you understand there is demand the real question now is how do we get to company readiness?
There are a couple of things you need to figure out:
What are your specific product and features?
As you go upmarket there will be deeper integrations, audit functionalities, custom work, custom features and you need to be very careful that you are building features to go upmarket that will not just get one but 10 mid-market and enterprise customers.
If you’re not careful here you can very quickly fall into the trap that many founders fall into. The trap of building features to get one deal done. You essentially become a custom development shop for one company. You DO NOT want to be there.
Get your GTM motion and strategy ready
A mid-market company but differently than an S&B as does an enterprise company. So at this point you’re probably going to have to up-level your messaging ad properly position yourself in this new segment of the market. That means speaking to the bigger vision around your company aka your narrative.
Basically, you have to revamp your GTM strategy to serve this new segment of the market. Work but worth it.
Revamp your pricing strategy
If you go to a mid-market company for a mission critical product you might make yourself look bad. People will devalue the product and won’t trust you as much. That’s why you need to revamp your pricing strategy based on what they are used to paying.
Up level your security and legal footprint
I’m talking about your security agreements, legal agreements, MSA – these are in a way the cost of entrance to play in the big leagues.
When you get these pieces right you will be able to compete, get larger deal sizes, grow, and even outpace your competition because they are not capable of doing this work.
If you want to dig more into what a GTM strategy should look like then check out my 6-steps to crafting your GTM strategy.
If you’re looking to go upmarket to serve in a bigger way and grow faster, you want to follow these three principles. Check out the video below that walks you through each principle step-by-step.
Are you starting to see the power in this?
If you are figuring out all these pieces be sure to check out my 5-point SaaS Growth Strategy Guide. Inside, we go into detail on how to grow your business and pull all the pieces together.