After $2M ARR, Specialize Sales Teams by Role and Segment
SaaStr advises B2B SaaS companies to begin sales specialization once they exceed $2M ARR, separating roles for qualifying, closing, renewing and segmenting by deal size.
After reaching $2m in ARR, B2B SaaS companies should begin specializing their sales teams rather than having all reps handle the same tasks, according to SaaStr.
Role Specialization
SaaStr states that qualifiers should qualify as BDRs. Openers should open as SDRs. Closers should close as AEs. Retainers should retain as CS. Renewers should renew as CS or Accounting. Upsellers should upsell as AM or sometimes AEs. Managers should manage teams of 6-8 AEs and 8-10 SDRs. Sales ops should be hired early to manage repeatability, training and onboarding.
Segment Specialization
Teams should be segmented into Small, Medium and Field/Large prospects. Later segmentation can extend to industries, verticals, direct and indirect channels. SaaStr notes that waiting to specialize is a top mistake made by founders and first VPs of Sales, with reps handling the same customers, deal sizes and industries.
Compensation and Efficiency
Pay closers on closing only, according to SaaStr. The source states this approach requires paying for more sales team members with higher quotas and efficiency, plus more success and renewals staff with higher net negative churn. AEs can complete more demos and calls when four meetings are already scheduled.
Scaling Timing and Example
Specialization is impossible in early days due to lack of scale, capital and customer base. SaaStr reports that Okta crossed $2.5 Billion in ARR with its SMB segment struggling versus enterprise. Okta responded by splitting its SMB team in half to specialize. Specialization produces more closed leads, faster renewals and higher NPS when staff operate in optimal roles, according to SaaStr.
