What if I told you that it’s possible to build a SAAS to $1 million in annual recurring revenue (ARR) in just 13 months?
All it takes is a great product, some solid marketing and sales efforts, and a bit of help from some great growth software.
In July of 2021, we launched the PPCAdLab beta program. As we worked to onboard customers and listened to their challenges, we developed an upsell that aligned perfectly with our PPCAdLab base offer.
Slowly, we began offering the upsell to our best customers, tweaking our marketing and sales approaches until we started getting consistent high-ticket results.
By June 2022 (month 11) we hit over 69k in monthly recurring revenue (MRR), and based on our projections, total MRR should hit $83,500 – just north of 1 million in 13 months.
The goal: Negative net churn
The ultimate objective is to create a net negative churn.
Net negative churn means your expansion revenue (from upsells and cross-sells) is greater than your customer churn.
Customer churn is the number of customers who cancel their subscription to your service every month.
Say you have 1,000 customers and 100 of them cancel their subscription (for whatever reason). Your customer churn rate would be 10%.
To get to a net negative churn, you want to make sure that the number of customers you’re adding each month is greater than the number of customers you’re losing.
For example, if you have 1,000 customers and you’re losing 100 each month (for a customer churn rate of 10%), but you’re also adding 200 new customers each month, then your net negative churn would be +100.
This doesn’t just mean that you’re growing, but that you’re doing so at an accelerating rate because each new customer not only pays you, they also bring in additional revenue from expansions.
The best part? This is just the beginning.
We’re confident that we can keep this growth going by using our upsell to continue expanding our income. According to Nathan Latka – the CEO of Founderpath – this can raise your SaaS valuation from 5x gross revenue to 11x.
How to scale to $1 million ARR and beyond
Our results are amazing, but they’re not special. These numbers are completely replicable.
We know, because we’ve taken our ideas from other successful startups who have used these marketing campaign strategies to grow well beyond $1 Million ARR, and they’re just getting started.
If you want to learn how you can scale your startup to seven figures in 13 months, keep reading. Then buckle down and put your newfound knowledge to work.
By the end of this post, you’ll know how to implement:
- Affiliate swipe email campaigns
- Abandoned signup sequences
- Onboarding campaigns
- Monthly special promotions to all non-active customers
- Waiting Lists
Let’s get started!
Affiliate Swipe Email Campaigns
Essentially, we give everyone who signs up for our affiliate program a file of fully customizable email templates to send to their email lists.
All they have to do is insert their affiliate link, personalise the message to fit their voice, and hit send.
Leveraging this strategy is worthwhile because most affiliate programs don’t help their affiliates run promotions. We’ve been able to add value to our affiliates and increase our customer base by just making it easier to run an effective promotion.
Our affiliate sequence is pretty simple:
- We spend 3 days inviting people to a webinar. We don’t tell them what the software is here; we just ensure they know it’s new and hasn’t been seen before, and how it solves a big pain point for them. Talking about this being a “new opportunity” really helps increase webinar registration numbers and show-up rate.
- For the next four days, we provide a replay
- On the last day, we provide a close-out timer.
On average, ⅓ of the signups come through the webinar live, ⅓ through the replay days 1-3, and another ⅓ via the last day of the promotion.
Most promotional closings are awful. Make sure prospects understand what they’re losing if they don’t sign up and actually close the promo. This will add 1/3 more sales.
The goal of the webinar is to convert leads into sales.
We offer a special 20-30% discount on our website listed pricing + extra bonuses they can’t get anywhere else. We also offer a trial on the webinar, and we end up converting roughly 70% of the trials to purchases.Leveraging a high-value offer, a no risk trial and a small purchase window is a great way to increase conversions on your affiliate email campaigns.
Abandoned signup sequences
The next campaign type you should implement in your marketing efforts is an abandoned signup sequence.
An abandoned signup sequence is a series of emails that you send to someone who has started the sign-up process for your product or service but has not completed it.
The goal of an abandoned signup sequence is to get the person to complete the sign-up process and become a paying customer.
A common reason why people abandon the sign-up process is that they are not sure if your product or service is right for them. Or they get distracted and just don’t finish.
Either way, it’s important to address their objections and remind them about their interest in getting more information about your offer with your abandoned signup sequence.
You can do this by providing more information about your product or service and how it can help them solve their problem.
You should also provide a special offer in your abandoned signup sequence to incentiviae people to complete the sign-up process.
Our abandoned signup sequence consists of four emails:
Email 1
We send an email 4 hours after someone starts the sign-up process but doesn’t complete it. This email is a reminder that they have not completed the sign-up process and provides a link to do so.
Email 2
We send an email 24 hours after someone starts the sign-up process but doesn’t complete it. This email is similar to the first one, but we also include a special offer in this email to incentivise people to complete the sign-up process.
Email 3
We send an email 48 hours after someone starts the sign-up process but doesn’t complete it. This email is similar to the first two, but we also include a case study in this email to show how our product or service has helped others solve their problem.
Email 4
We send an email 72 hours after someone starts the sign-up process but doesn’t complete it. This email is similar to the first three, but we also include a testimonial in this email to show how our product or service has helped others solve their problem.
The key to an effective abandoned signup sequence is to provide value in each email and to gradually increase the urgency of the offer.
You should also make it easy for people to complete the sign-up process by including a link to the sign-up page in each email.
By implementing an abandoned signup sequence, you can significantly increase the number of people who complete the sign-up process and become paying customers.You can even automate the whole sequence using automation; check out our beginner’s guide to email automation to get started.
Onboarding campaigns
Onboarding campaigns are vital to the success of any SaaS business.
They help new users get started with your product and ensure that they see value in it. Be hands-on with this process, because, without an effective onboarding campaign, users are likely to churn.
Things to keep in mind:
- Make sure your onboarding campaign is targeted to the user’s needs. Onboarding campaigns should be based on custom fields and user data so that they are highly relevant to the individual. Here’s how to create a personalised onboarding experience for your new users.
- Focus on activation. The goal of an onboarding campaign is to get the user to take action with your product. This could be something like adding review profiles in a reputation management platform or completing a task in a project management tool.
- Keep it short and sweet. Users have short attention spans, so make sure your onboarding campaign is concise and to the point. If you’re looking for a little inspiration, here are 7 SaaS welcome emails to inspire you!
During our onboarding campaigns, we get users to register for our weekly webinar too. We find this helps greatly with activation, but also customers’ perception of the brand and software. Plus it helps us with revenue expansion. I’ll expand more on that later.
Monthly special promotions
Every month, we offer a special promotion to all of our non-active customers.
This could be an extra bonus, a discount on a new feature, or even working with an affiliate/partner to give away one of their courses with purchase. The key is to come up with any marketing angle that will give you a reason to have a sale.
Running monthly specials like this makes it easier to stack monthly and yearly deals.
For example, our current monthly special we’re calling our Birthday Sale. Users get 20% more credits in their plan. Save 50%. And on top of that get 8 training sessions and courses from our affiliate partners that have a value that’s greater than our yearly plan!
Tip: Think about how you can get revenue expansion from the start.
We give a 20% discount on our yearly offer. We get about a 10% take rate on this, and doubles our cash collected on every promo we run. This is a hugely profitable strategy for bootstrapped businesses like ours.
We’ve also found that monthly specials are a great way to reactivate customers who have churned. In many cases, all it takes is a little reminder that they’re missing out on valuable content, a new strategy, or discounts to get them to come back.
Waiting Lists
A big part of our plan to reach $1 million ARR was to work on revenue expansion.
We wanted to get to net negative churn long term, and knew we never could do that without a good upsell or cross-sell.
We’re currently at 60k MRR, across 400 paying customers.
On our weekly training/support calls, we always pitch our upsell product – but tell people the only way to get access is to sign up for the waitlist. Then, every month or so we open the waitlist to a small handful of the list.
This month we offered it to 8 people on the waiting list, and 6 purchased it at $5,000 per year.
By leveraging a waitlist to give users a sense of exclusivity and urgency around purchasing our upsell, we’ve been able to increase our conversion rate and get more people interested in our product.
Conclusion
By implementing an abandoned signup sequence, focusing on activation during onboarding campaigns, affiliate strategy, running monthly specials, and leveraging a waiting list, you can significantly increase the number of people who complete the sign-up process and become paying customers.
These strategies will also help you boost customer lifetime value and reach your ARR goals at an accelerated rate.
To find out more about how to grow your SaaS business using GoSquared Engage, reach out to us at any time to arrange a personal demonstration with one of our sales engineers.
About Joe Troyer
If you have any questions or want to keep in touch, I’m @joetroyer on Twitter, and can be contacted on joe(at)virtualvalley(dot)io.
I’m one of the founders of Virtual Valley. We own and grow profitable bootstrapped ventures that are entirely bootstrapped and funded by customers, forcing us to focus on building products that customers, not investors, love.
We unlock growth in marketers, agencies, and businesses by building ventures that solve the biggest challenges facing tomorrow’s leading companies.
